While We Are Skewering International Patronage Anachronisms…

April 10, 2012

Advocates for a competitive, meritocratic selection process for the President of the World Bank are dead right. Allowing the White House to just pick is deeply unfair, inefficient, and a relic of a by-gone age.  But why stop there?  Here’s my list of international patronage anachronisms that should also go:1. The World Bank Board. The 25 executive directors are supposed to represent the shareholders, guide broad strategy, and hold management accountable.  But rather than serve this function, the EDs and their dozens of senior advisors have become a patronage machine, taking up huge amounts of office space and costing $70 million per year.  Worse, they meet twice a week and constantly hound management. Bretton Woods architect John Maynard Keynes initially, and sensibly, proposed a nonresident board for the Bank but travel was impossible in 1944 because of German U-boats. There’s no longer any reason to need a permanent top-heavy resident board. Like the European Investment Bank and the Global Fund (and as Dennis de Tray and I recommend here for the African Development Bank) there are lighter more sensible models.2. The IMF. Obviously if the U.S. gives up the prerogative at the World Bank, the Europeans must do the same at the Fund.3. And the Japanese at the Asian Development Bank. (The African Development Bank actually comes closest to a truly competitive process and, no coincidence, likely has the best leader.)4. The United Nations. UN agencies are literally packed top-to-bottom with patronage appointments, based on both tradition and nationality quotas.  At least the World Bank staffing is mostly meritocratic.  No one even pretends this is the case in most parts of the UN.As I argued in Businessweek, all the sensible technical reasons for an open World Bank nomination fly in the face of realpolitik. No administration, in the U.S. or anywhere else, just gives away a plum international seat just because it’s the right thing to do. But if the U.S. does cede the World Bank, it should at the very least demand reform elsewhere in the archaic international system.


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