The Wolfowitz Set-up: Just Say "No"

When it comes to media reports of bad conduct by Administration officials and appointees, it is a good idea to Just Say No to the first accounts you read. Chances are the story was cooked up and peddled by political partisans (often one way or another funded by George Soros) or that disgruntled bureaucrats leaked to a lazy, gullible, if not complicit, press.

The media conniption fit over Paul Wolfowitz' supposed "conflict of interest" at the World Bank is a prime example. Based on claims by disgruntled staffers, non-government agencies and some World Bank officials, the Financial Times painted a very skewed picture of Wolfowitz' role in the resolution of a personnel matter involving his companion, Shaha Riza, a long time Bank employee of note whose continued service the Bank determined would constitute a conflict of interest once he took over as President of the Institution, and called for his resignation. 

Everyone who knows Paul Wolfowitz knows him to be a person of great intelligence and character, yet the first accounts of the kerfuffle at the World Bank suggested he'd pulled a fast one, working out a lucrative deal for a long time companion without the knowledge and approval of the Bank's Board of Directors and in violation of Bank procedures. Commentators who should know better (including Investors Business Daily) joined the chorus for his removal.

All of this was nonsense. For one thing it ignored the facts in this case. For the other it ignored the back story: An institution long run by Americans who largely fund its operations was under attack by Europeans who wanted to change that tradition; an institution which had long averted its eyes from the billions of dollars it was funneling to corrupt leaders was being pushed to change its culture; a grossly over compensated staff largely anti-Bush, was digging in its heels at Wolfowitz' efforts to fund Iraqi reconstruction projects.

It took more than a day for the underlying exculpatory documents to be released by the Bank and  another  day or so to digest them, but they show beyond peradventure of doubt that this was a set up from day one.

Fox News was the first to suggest the story was an overblown account of what had happened and had the grace to provide its readers with some of the underlying documents which proved that.
Earlier, the bank board released a short statement saying it had determined that Wolfowitz dictated the terms of Riza's promotion and salary increase to the bank's head of human resources without a review of those terms by an ethics committee or the board's chairman. The board promised it would "move expeditiously to reach a conclusion" about what actions to take next.

But FOX News has analyzed more than 100 pages of internal bank documents dating to 2005 that paint a far more complex portrait of the case - and suggests that the bank's own ethics committee had known the terms of the settlement with Riza for at least a year.

The documents show that while Wolfowitz did indeed dictate the lucrative terms of Riza's salary to the bank's human resources chief, he also took steps to try and determine if what he was doing was right - seemingly trying to navigate his way through an arcane bureaucracy with a maze of unusual rules and procedures.

The documents also show that, while many board members have claimed that they only learned the details of Riza's case - and salary hike - this week in newspapers, the board's Ethics Committee has been fully aware of all the details since early 2006, when it conducted a probe and determined that the allegations "did not appear appropriate for further consideration."

The documents paint a more sympathetic picture of Wolfowitz and his efforts to deal with the situation than what's been revealed in the press thus far. And they shine a light on the bank's board as having far more knowledge of the case than members have let on in off-record talks with the media.

They also raise the specter of whether politics is driving at least some aspects of the scandal - as Wolfowitz and the board have long had a tense and sometimes acrimonious relationship over such vital issues as how to deal with corruption among bank borrowers who are also the institution's membership.
Still, the story continued over the weekend in a clear effort to undermine his authority and sway over the institution and undermine both him and the Administration. And a very important weekend this was for him, it was the meeting of the Bank's Development Committee which sets Bank policy and the Joint IMF-World Bank Meeting.

The revelations roiled the assembly and detracted from his work. The President's stated support for Wolfowitz was joined by some:

Treasury Secretary Henry Paulson said the United Stats welcomed and supported an updated version of the bank's anti-corruption strategy developed under Wolfowitz's leadership. Since taking over, Wolfowitz has made anti-corruption efforts a priority, prompting concern from some of the board's European members that he was overemphasizing the issue.

Paulson called Wolfowitz "a very dedicated public servant" and said the review process by the board should be allowed to proceed.

As Wolfowitz entered the meeting room, he received a pat on the back from Rodrigo de Rato, the head of the International Monetary Fund, the World Bank's sister institution. Wolfowitz put his briefing papers down and, smiling, greeted members of the committee, headed by Mexico's Agustin Carstens. [snip] .

A planned demonstration by bank employees calling for Wolfowitz to resign didn't happen, but several dozen members of advocacy groups marched outside the bank headquarters calling for his ouster.

Some African officials attending the meetings expressed support for Wolfowitz, saying he has made the continent a greater priority at the bank.

"We have seen visionary leadership, steadfast progress under Mr. Wolfowitz," said Liberia's finance minister, Antoinette Sayeh. "We can only say that we look forward to that continuing."
By Sunday. The Wall Street Journal lifted the curtain on this power play:
When Paul Wolfowitz became President of the World Bank in 2005, our private prediction was that it would take about a year before the bureaucratic interests at the bank and in the global "development" industry made a play to oust him. We were off by a few months.

The forces of the World Bank status quo are now making their power play, demanding that the bank's board ask him to resign over an ethics flap involving his girlfriend. The dispute is so trivial that it betrays that this fracas has little to do with Mr. Wolfowitz's ethics. The real fight here is over his attempt to make the bank and its borrowers more accountable for results, especially by exposing and punishing corruption.

Given his role in the Bush Administration, Mr. Wolfowitz was never going to have an easy time of it at an "international" institution as hide-bound as the World Bank. Its employees make tax-free salaries far larger than most would make at home, or in the private sector. For decades they have been measured not by how much poverty they alleviate, but by how much "lending" they shovel out the door.

Mr. Wolfowitz has tried to institute more accountability, especially on corruption. Who could be against fighting corruption? Well, for starters, a global poverty industry that thinks "governance" is a distraction from the only real measure of development, which is how much money "rich" nations choose to redistribute to poor ones. Never mind that many of these countries stay poor year after year precisely because they squander or steal foreign aid. "Governance" ought to be a crucial lending criterion, but in trying to make it so Mr. Wolfowitz is bucking decades of old thinking.
The Journal detailed the facts leading up to the agreement with Shaha Riza, the employee the Bank had insisted be seconded elsewhere, suggested the decision that her continued employment would constitute a conflict was questionable, revealed how he had asked to be recused from the negotiations and revealed that the Ethics Committee of the Bank had been fully informed of the settlement with her.

Monday, the Journal called this what it is-"a smear" and a "Euro-bureaucracy-media-putsch".

I urge you to read the record so well set out here of the way the Bank's Ethics Committee forced him to resolve a matter of dubious real import, from which he'd asked to be relieved, told him to direct the terms of the settlement with Ms Riza, were informed of it and yet kept silent when the charge of wrongdoing was made.
All of this is so unfair that Mr. Wolfowitz could be forgiven for concluding that bank officials insisted he play a role in raising Ms. Riza's pay precisely so they could use it against him later. Even if that isn't true, it's clear that his enemies--especially Europeans who want the bank presidency to go to one of their own--are now using this to force him out of the bank. They especially dislike his anticorruption campaign, as do his opponents in the staff union and such elites of the global poverty industry as Nancy Birdsall of the Center for Global Development. They prefer the status quo that holds them accountable only for how much money they lend, not how much they actually help the poor.

Equally cynical has been the press corps, which slurred Mr. Wolfowitz with selective reporting and now says, in straight-faced solemnity, that the president must leave the bank because his "credibility" has been damaged. Paul Wolfowitz, meet the Duke lacrosse team.

The only way this fiasco could get any worse would be for Mr. Wolfowitz to resign in the teeth of so much dishonesty and cravenness. We're glad the Bush Administration isn't falling for this Euro-bureaucracy-media putsch. Mr. Wolfowitz has apologized for any mistakes he's made, though we're not sure why. He's the one who deserves an apology.
Even the Washington Post ended its less than very informative article on the matter Sunday thusly:
"I'm amazed that the ethics committee had a lot of views, but then stepped back from their implementation," said Ruth Wedgwood, a professor of international law at Johns Hopkins University. Turning the matter over to Wolfowitz to resolve in the first place, she noted, was "sort of oxymoronic: 'You can't recuse yourself enough to suit us, but we want you to be formally in the chain of command to resolve this.' "
The anti-Wolfowitz leaks keep coming, but the source of the animus remains clear--he's a Bush-supporting American:
Of the top five outside international appointments made by embattled World Bank president Paul Wolfowitz during his nearly two-year tenure, three were senior political appointees of right-wing governments that provided strong backing for U.S. policy in Iraq.

The latest appointment came just last month when former Jordanian Deputy Prime Minister Marwan Muasher was named senior vice president for external affairs.

Muasher served as King Abdullah's ambassador here in Washington in the run-up to the Iraq war in 2002 and reportedly played a key role in ensuring Amman's co-operation in the March 2003 invasion.

During and after the invasion, when he served first as foreign minister and then as deputy prime minister, he was considered among Washington's staunchest supporters in an increasingly hostile Arab world.

Muasher's appointment came nine months after Wolfowitz named former Spanish foreign minister Ana Palacio as the Bank's senior vice president and general counsel. As foreign minister, she was an outspoken proponent of the U.S.-led Iraq invasion, to which her government, led by former Prime Minister Jose Maria Aznar, contributed 1,500 troops.

Also in June 2006, Wolfowitz named former Salvadoran Finance Minister Juan Jose Daboub as one of the Bank's two managing directors. In addition to his financial post, Daboub served as chief of staff to former President Francisco Flores when, as a charter member of the U.S.-led "Coalition of the Willing", he sent nearly 400 Salvadoran combat troops to Iraq, more than any other developing country."
I know most people read the papers while rushing off to work or listen to the news while otherwise engaged. I understand that they haven't the time to follow these reports through to the conclusion or analyze them in depth at the time. But this is just one of countless examples of sloppy, inaccurate reporting-almost always to the disadvantage of the good people in this Administration or appointed by the President.

At the very least when you hear or read these stories just say "no". Do not let them sway your view of the matter. Wait a couple of days. When the story proves to have been yet another bit of nonsense, you may have to search to find it because it never gets the coverage of the first, false reports, but at least you won't continue to be yanked around like dumb sheep.

Clarice Feldman is a frequent contributor to American Thinker.
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