Europeans push for ouster of Wolfowitz

U.S. power to appoint World Bank president is lever

May 08, 2007|By New York Times News Service.

WASHINGTON -- Leading governments of Europe, mounting a new campaign to push Paul D. Wolfowitz from his job as World Bank president, signaled yesterday that they were willing to let the United States choose the bank's next chief, but only if Wolfowitz stepped down soon, European officials said.

European officials have indicated they want to end the tradition of the U.S. picking the World Bank leader. But now the officials are hoping to enlist American help in persuading Wolfowitz to resign voluntarily, rather than be rebuked or ousted.

The goal, they said, is to avert a public rupture of the bank board over a vote, possibly this week, to sanction Wolfowitz. Even if the vote is a reprimand, they said, it could effectively make it impossible for him to stay on.

The Europeans worked to arrange a quick exit for Wolfowitz as a special bank committee concluded that he was guilty of breaking rules barring conflicts of interest in arranging for a pay raise and promotion for Shaha Ali Riza, his companion and a bank employee, in 2005.

The decision was sent to Wolfowitz Sunday night after a month of turmoil over the situation. The panel's findings were not made public, but people familiar with the report said that it reviewed documents and testimony before concluding that Wolfowitz had breached his obligations in arranging for Riza's reassignment from the bank to the State Department.

"What I'm hearing from colleagues is, `Let's not push the Americans too hard,'" said a senior European official involved in policy on the bank. "We want to avoid a split between the United States and its European allies. We're willing to say: `OK, you find a capable American to run this institution and we can live with that.'"

In another sign of Wolfowitz's difficulties, his top communications aide, Kevin Kellems, resigned yesterday, saying "the current environment surrounding the leadership" at the bank made it "very difficult to be effective in helping to advance the mission of the institution."

European officials said the suggestion that Wolfowitz resign in return for having an American successor was first raised with Treasury Secretary Henry M. Paulson Jr. in mid-April.

Bush administration officials say that American leadership of the World Bank is essential to maintaining influence over its policies and priorities, including which bank programs and countries receive financing.

The United States has 16.4 percent of the voting share at the 24-member World Bank board that chooses the president. Europeans have twice that share if they stick together, which many bank officials say they have signaled they are willing to do to remove Wolfowitz.

The senior European official said Wolfowitz's credibility is "beyond repair."

That view has echoed through the bank's ranks. Hundreds of bank employees assembled yesterday to hear Mark Malloch Brown, the former top aide to Kofi Annan at the United Nations, say that with Wolfowitz in charge, the bank's anti-poverty agenda was "hugely at risk" because Europeans were balking at the financing.

The committee's finding of guilt against Wolfowitz was tempered by a finding that the bank shared some blame for the failure of Wolfowitz to comply with its rules. According to people familiar with the report, it said the advice from ethics officials at the bank to Wolfowitz was less than clear and subject to misinterpretation. Still, the report was clear in its conclusion that Wolfowitz breached his obligations.

Wolfowitz's lawyer, Robert S. Bennett, said the bank was giving Wolfowitz too little time to rebut its conclusions before a board vote later this week. "I am deeply troubled that they have only given us 48 hours to respond," he said. "This is not fair to Mr. Wolfowitz."

The report, as transmitted to Wolfowitz, did not recommend any punishment. Bank officials, speaking anonymously because the proceedings are supposed to be confidential, said the special committee was still working on what to recommend.

It was not clear whether the committee, consisting of seven of the bank's 24 board members, would recommend removing him from office or, more likely, express a loss of confidence in his leadership in a manner intended to force his resignation. Bank officials say the majority of the bank board has determined that he should go.

The Bush administration has repeatedly backed Wolfowitz, but President Bush and Paulson have also called for the completion of the bank's internal review. Several European officials said they believed Paulson was in favor of Wolfowitz leaving, but that Bush and Vice President Dick Cheney insisted on backing him.

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