posted on April 28, 2007 03:27:22 PM new
Wolfowitz Facing Stiffening Opposition
Updated 5:32 PM ET April 28, 2007
By JEANNINE AVERSA
WASHINGTON (AP) - Paul Wolfowitz encountered stiffening opposition Saturday to staying on as World Bank president amid allegations he showed favoritism in arranging a promotion and pay package for his girlfriend.
European countries led by Germany and France want Wolfowitz to step down, while support for the embattled president has eroded in Nordic nations and elsewhere, according to bank officials and others close to the situation.
A special bank panel is investigating whether Wolfowitz violated bank rules in his handling of the 2005 promotion of bank employee Shaha Riza to a high-paying State Department job.
The World Bank's 24-member board will decide what action, if any, to take; a decision is expected this week. The board could ask him to resign, signal it does not have confidence in his leadership, reprimand him or take no action.
Critics, including World Bank staff, former bank officials, the European Parliament, aid groups and some Democrats say the controversy has damaged the development institution's reputation and may hobble its ability to fight global poverty. They are pressing Wolfowitz to step down on his own.
Wolfowitz has said he made a mistake, and he has apologized. He plans to make his case before the special panel on Monday.
His attorney, Robert Bennett, said Saturday that Wolfowitz "has no intention of resigning under this cloud." Bennett said that when Wolfowitz personally addresses the special panel on Monday, "We are going to be presenting powerful evidence that Mr. Wolfowitz acted in good faith."
The panel, which is make recommendations to the board, is said to be finalizing its work.
"We have full confidence in Paul Wolfowitz and expect that he will be able to work with the World Bank to resolve these issues," White House spokesman Tony Fratto said Saturday.
The Washington Post, citing unnamed sources, reported Saturday that the panel concluded that Wolfowitz breached ethics rules by arranging the compensation package for Riza. The panel was considering whether to explicitly recommend that Wolfowitz resign, according to the report.
World Bank spokespeople and other bank officials could neither confirm nor deny the report.
Bennett said he had not seen any findings from the special panel, and expressed outrage at the World Bank's handling of the case.
"The whole process is a sham," Bennett said. "They have differences with him on policies and management style. Instead of dealing with those, they are creating this phony conflict-of-interest crisis."
The United States, the bank's largest shareholder, continues to stand by Wolfowitz. By tradition, the World Bank has been led by an American. President Bush tapped Wolfowitz and the bank's board approved the selection despite complaints from Europeans about Wolfowitz's role in the Iraq war.
Before joining the bank in June 2005, Wolfowitz was the No. 2 official at the Pentagon and played a main role in mapping out the U.S.-led war in Iraq.
The matter at hand that has Wolfowitz fighting to keep his World Bank job involves whether he violated bank rules in his handling of the 2005 promotion and pay package for Riza.
She already worked at the bank when Wolfowitz took the job. She was assigned duties outside the bank to avoid a conflict of interest, although she remained on the bank's payroll. Riza had earned close to $133,000 as a communications adviser in the bank's Middle East department. After the assignment change, she was getting paid $193,590.
The terms and conditions of the package, however, had not been "commented on, reviewed or approved" by the World Bank's ethics committee, its chairman or the bank's board, according to the bank's executive directors.
Riza also is expected to appear before the special bank panel on Monday. A message left with her lawyer was not immediately returned.
Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
posted on April 29, 2007 08:17:26 AM new
""But it's always interesting to watch their responses when proof like this is offered....they just don't want to acknowledge it.""
Of course, they can't when they're all excited about a light bulb in somone's rectum....it's THEIR thing I guess
posted on May 14, 2007 08:31:49 PM new
ANOTHER OF THE BUSHIT BUDDIES!
Report: Wolfowitz Broke World Bank Rules
Updated 10:33 PM ET May 14, 2007
By JEANNINE AVERSA
WASHINGTON (AP) - World Bank President Paul Wolfowitz broke bank rules in arranging a hefty compensation package for his girlfriend, a situation that has caused a "crisis in the leadership" at the institution, according to a report released Monday by a special bank panel.
Wolfowitz described the report's findings as "unfair and unwarranted."
The special panel said the bank's full 24-member board must consider whether Wolfowitz "will be able to provide the leadership" to ensure that the bank achieves its mission of fighting poverty around the world.
The board will ultimately decide Wolfowitz's fate.
Board members have discussed a range of disciplinary options. It could fire Wolfowitz, ask him to resign, signal that it lacks confidence in his leadership or reprimand him. Board members have been leaning toward an expression of no confidence or other tough language that would make it difficult _ if not impossible _ for Wolfowitz to stay on.
Treasury Secretary Henry Paulson, however, does not think the facts merit dismissal, according to department spokeswoman Brookly McLaughlin.
Wolfowitz said he acted in good faith in arranging Riza's pay package. He has accused his critics of launching a "smear campaign" against him.
He is scheduled to make an appearance before the board late Tuesday. The proceedings are not public. A decision could come as early as Tuesday or Wednesday.
The controversy that has put Wolfowitz's job in jeopardy involves his handling of the 2005 compensation pay package for his girlfriend, Shaha Riza, a bank employee.
The special bank panel concluded that Wolfowitz's involvement in the details of the package "went beyond the informal advice" given by the bank's ethics committee and that he "engaged in a de facto conflict of interest," the report stated. Under Wolfowitz's contract as well as the code of conduct for board officials, he was required to avoid any conflict of interest, the report said.
In a response to the panel's report, Wolfowitz said, "It is highly unfair and unwarranted to now find that I engaged in a conflict of interest because I relied on the advice of the ethics committee as best I understood it."
Wolfowitz also said he did not attempt to hide details of the arrangement from bank officials. "I did not have it locked up or placed in a secret drawer; it was a contract of the bank," Wolfowitz wrote in his submission to the panel.
Riza worked for the bank before Wolfowitz took over as president in June 2005. She was moved to the State Department to avoid a conflict of interest but stayed on the bank's payroll. Her salary went from close to $133,000 to $180,000. With subsequent raises, it eventually rose to $193,590.
The panel concluded that the salary increase Riza received "at Mr. Wolfowitz's direction was in excess of the range" allowed under bank rules.
Wolfowitz "placed himself in a conflict of interest situation" when he became involved in the terms and details of Riza's assignment and pay package and "he should have withdrawn from any decision- making in the matter," the panel said.
The panel acknowledged, however, that the informal advice provided by the ethics committee "was not a model of clarity."
Still, the entire episode involving Wolfowitz's handling of the pay package "underscores that there is a crisis in the leadership of the bank," the panel said.
In addition, the special panel said it was of the view that the controversy "has had a dramatic negative effect on the reputation and credibility" of the bank, had raised "serious questions" about the bank's governance and ability to carry out its mission and was contributing to "erosion in the operational effectiveness" of the bank.
The special panel also raised fears that the fracas could hinder the bank's ability to raise billions of dollars from countries around the world to provide financial help to poor countries.
Before he took the bank's helm, Wolfowitz was the No. 2 official at the Pentagon and a key architect of the U.S.-led war in Iraq.
European members _ led by Germany, France and the Dutch _ are pushing for Wolfowitz to resign. European and other countries, however, would still like to avoid a pitched battle with the United States, the bank's largest shareholder. It's unclear, though, whether such a battle can be avoided.
The Bush administration continued to stand by Wolfowitz.
"A clear reading of the facts in this report demonstrates that this was a unique situation, missteps occurred on all sides and communication may not have been clear enough," said Treasury's McLaughlin.
"The facts reveal that President Wolfowitz acted to find a pragmatic solution and to carry out the direction he received from the ethics committee," she added. "Secretary Paulson spoke to some of his colleagues today from other countries and expressed that he does not think the facts merit dismissal."
To that end, the administration has intensified efforts to win support for Wolfowitz and is reaching out to the other members of the Group of Seven countries _ Japan, Germany, France, Britain, Italy and Canada. A conference call among the G7 countries is anticipated.
The United States requested earlier Monday that the special panel's report be delayed being sent to the board by a few hours, said White House spokesman Tony Fratto. "But it had nothing to do with phone calls or contact with other countries," Fratto said. "We just needed the time to ensure that the report is fair and factual and to allow for a proper process for discussions going forward. It had nothing to do with presidential activity."
By tradition, the World Bank has been run by an American, while the International Monetary Fund has been run by a European. President Bush tapped Wolfowitz, a move that was approved by the bank's board. The United States keenly wants to preserve that decades-old tradition.
Vice President Dick Cheney said Monday that Wolfowitz should remain chief of the bank. The White House has repeatedly expressed confidence in Wolfowitz.
However, many of the bank's staff, former bank officials, aid groups and Democratic politicians also have called on Wolfowitz to resign.
For now, Wolfowitz intends to carry on with his duties. He still plans to make a trip to Europe later in the week.
Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
posted on May 17, 2007 11:40:02 PM new
Gone the way of Colin Powell, Rummy, Brownie, DeLIE, Abramoff, Scooty and soon Gonzales....poor georgie's going to be so lonesome .....
Wolfowitz to Resign From World Bank
Updated 1:10 AM ET May 18, 2007
Listen to Audio Clip
By JEANNINE AVERSA
WASHINGTON (AP) - World Bank President Paul Wolfowitz said Thursday he will resign at the end of June, giving up his long fight to survive pressure for his ouster over the generous compensation he arranged for his girlfriend.
His departure ends a two-year run at the development bank that was marked by controversy from the start, given his previous role as a major architect of the Iraq war when he served as the No. 2 official at the Pentagon.
"He assured us that he acted ethically and in good faith in what he believed were the best interests of the institution and we accept that," the board said in its announcement of Wolfowitz's resignation.
Wolfowitz was all but forced out, however, by the finding of a special bank panel that he violated conflict-of-interest rules in his handling of the 2005 pay package of bank employee Shaha Riza.
The controversy, which gripped the bank for a month, was seen as a growing liability that threatened to tarnish the poverty-fighting institution's reputation and hobble its ability to persuade countries around the world to contribute billions of dollars to provide financial assistance to poor nations.
By tradition, the World Bank has been run by an American. The Bush administration keenly wanted to keep that decades-old practice firmly intact as the board dealt with Wolfowitz's fate. The United States is the bank's largest shareholder and its biggest financial contributor.
The White House said it would have a new candidate to announce soon, allowing for an orderly transition.
Earlier Thursday, President Bush had seemed resigned to the likelihood that Wolfowitz would lose his job over the conflict-of-interest charges. "I regret that it's come to this," Bush said.
In its statement, the bank's board said it was clear that a number of people had erred in reviewing Riza's pay package.
Wolfowitz, who had fought the pressure to resign for weeks, had sought a recognition from the bank that he did not bear sole responsibility for the matter. In his own statement Thursday, Wolfowitz said he was pleased that the board "accepted my assurance that I acted ethically and in good faith in what I believed were the best interests of the institution, including protecting the rights of a valued staff member."
Now, he said, it was in the best interest of the board that its mission "be carried forward under new leadership."
The board's statement made no mention of any financial arrangements related to Wolfowitz's departure, nor did it speak to Riza's future.
As a result of the controversy, the board pledged to review the World Bank's ethics policies, noting that "the bank's systems did not prove robust to the strain under which they were placed."
Wolfowitz waged a vigorous battle to save his job and maintained he had acted in good faith.
European nations had led the charge for Wolfowitz to resign. Those calls were backed by many on the bank's staff, former bank officials, aid groups and some Democratic politicians.
Until near the end, the Bush administration had professed support for Wolfowitz. But in a shift on Tuesday, the White House indicated for the first time it was open to his departure. It was the same day Wolfowitz made a last-ditch plea to save his job before the board.
Among those mentioned as a possible replacement for Wolfowitz are former Deputy Secretary of State Robert Zoellick, who was Bush's former trade chief; Robert Kimmitt, the No. 2 at the Treasury Department; Treasury Secretary Henry Paulson; former Republican Congressman Jim Leach and Sen. Richard Lugar, R-Ind., and Stanley Fischer, who once worked at the International Monetary Fund and is now with the Bank of Israel.
Paulson, who will work with the president on finding a successor to Wolfowitz, said: "I will consult my colleagues around the world as we search for a leader."
Riza worked for the bank before Wolfowitz took over as president in June 2005. She was moved to the State Department to avoid a conflict of interest but stayed on the bank's payroll. Her salary went from close to $133,000 to $180,000. With subsequent raises, it eventually rose to $193,590. The panel concluded that the salary increase Riza received "at Mr. Wolfowitz's direction was in excess of the range" allowed under bank rules.
Wolfowitz "placed himself in a conflict of interest situation" when he became involved in the terms and details of Riza's assignment and pay package and "he should have withdrawn from any decision-making in the matter," the panel said. Under Wolfowitz's contract as well as the code of conduct for board officials, he was required to avoid any conflict of interest, the report said.
The panel acknowledged that the informal advice Wolfowitz received from the bank's ethics committee "was not a model of clarity."
Still, the entire episode involving Wolfowitz's handling of the pay package "underscores that there is a crisis in the leadership of the bank," the panel said.
Before taking over the bank nearly two years ago, Wolfowitz was the No. 2 official at the Pentagon and played a lead role in mapping the U.S.-led war in Iraq.
Bush tapped Wolfowitz for the job, a move that was approved by the bank's board even though Europeans didn't like him because of his role in the Iraq war.
The 185-nation World Bank, created in 1945 to rebuild Europe after World War II, provides more than $20 billion a year for projects such as building dams and roads, bolstering education and fighting disease. The bank's centerpiece program offers interest-free loans to the poorest countries.
The bank's staff association, which had called for Wolfowitz to step down, said in a statement: "Mr. Wolfowitz has finally done the necessary thing by resigning. He has damaged the institution and continues to damage it every day that he remains as its president."
Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Edited to add Gonzales's name
[ edited by mingotree on May 17, 2007 11:40 PM ]
[ edited by mingotree on May 18, 2007 07:25 AM ]
posted on May 18, 2007 07:06:44 PM new
World Bank Justice
Wolfowitz's resignation offers a window into a corrupt institution.
Friday, May 18, 2007 12:01 a.m. EDT
So after weeks of nasty leaks and media smears, the World Bank's board of executive directors yesterday cleared President Paul Wolfowitz of ethical misconduct for following the board's own advice on how to handle a conflict of interest involving his girlfriend. And Mr. Wolfowitz in turn will resign from the bank at the end of June. Run that by us again?
We've said from the beginning that the charges against Mr. Wolfowitz were bogus, and that the effort to unseat him amounted to a political grudge by those who opposed his role in the Bush Administration and a bureaucratic vendetta by those who opposed his anti-corruption agenda at the bank. That view was vindicated by yesterday's statement, which showed how little the merits of the case against Mr. Wolfowitz had to do with the final result.
Mr. Wolfowitz "assured us that he acted ethically and in good faith in what he believed were the best interests of the institution, and we accept that," the directors said, thus rejecting the findings of a rigged investigating committee that had ignored key evidence. The most damning judgment the directors could muster is that "a number of mistakes were made," including by the bank's own ethics committee that had refused to let Mr. Wolfowitz recuse himself from matters involving his girlfriend, Shaha Riza.
In other words, this was all about politics. And all that mattered to Mr. Wolfowitz's accusers was to be rid of him, whatever the pretext or methods. The least they can do now is restore Ms. Riza to her job, assuming she wants to be part of an organization that treated her so shabbily.
This all may pass as World Bank justice. For the rest of us, it has served as a window into an institution that seems to observe no rule other than the interests of the unaccountable mandarins who consider themselves its rightful owners. There have been plenty of outrages in the bank's treatment of Mr. Wolfowitz, but for sheer chutzpah nothing exceeds the argument of last week's report by the investigating committee of the board that he had put the institution "in a bad and unfair light" by daring to defend himself publicly against selective and false media leaks designed to smear him. Had Mr. Wolfowitz taken that advice, he would have been out on his ear without so much as the benefit of the formal acquittal he has now received.
As for the Bush Administration, it might be in a better position now had it defended its man as vigorously as he defended himself. Instead, its officials were slow to understand what was happening and--with the exception of President Bush himself--largely mute as the coup unfolded. Treasury Secretary Hank Paulson took the line that the U.S. would allow the bank process to work itself out, when it ought to have been clear that the process itself was rigged.
Secretary of State Condoleezza Rice remained on the sidelines until the very end, and her reported "quiet diplomacy" on Mr. Wolfowitz's behalf was precisely the wrong way to fight a battle being waged on front pages. Her behavior in this case is reminiscent of her pre-emptive capitulation on the famous "16 words" in President Bush's 2003 State of the Union, words that Britain's Butler Report later concluded were "well-founded" but which now are a defining myth of the left's "Bush lied" theology.
Mr. Paulson and Ms. Rice may think that by staying on the sidelines of the Wolfowitz fight they have safeguarded their own political capital. Perhaps, but the precedent being set by Mr. Wolfowitz's departure will damage not just the Bush Administration in the time it has left but U.S. interests for years to come.
An American appointee has been ousted from a multilateral institution by a staff and media cabal on trumped-up charges solely because they disliked Mr. Wolfowitz's priorities. The inmates are now in charge. Yet the U.S. will still be expected to provide the bulk of funding to these institutions--more than 16% at the World Bank--while it cedes de facto control of its operations to a multilateral elite. That's a recipe for declining American influence.
If there is a silver lining here, it is that the public has been able to get a glimpse of how the World Bank works and what it actually accomplishes. Among other lowlights, we've recently been reminded that the bank annually pushes billions in loans to countries like China and Mexico that can easily get credit in private capital markets. We've seen that many of those loans go to projects in places like India or Kenya that are riddled by corruption; the bank may have lost as much as $8 billion to corruption in 25 years of lending to the Suharto regime in Indonesia. We've also learned that the bank funds literally hundreds of projects from Albania to Niger that were ill-conceived and proved to be failures.
We've seen that senior bank personnel, such as former Indonesia country director Dennis de Tray, openly argue that corruption is no big deal and should not get in the way of the bank's "helping people." We've seen how the bank trashed the careers of longstanding and well-regarded employees such as Bahram Mahmoudi, who blew the whistle on a misamanaged project. We've seen how Shengman Zhang, the bank's No. 2 under former President Jim Wolfensohn, seems to think there's nothing amiss with calling for Mr. Wolfowitz's resignation despite the fact that Mr. Zhang's wife was swiftly promoted while working under him.
We've seen how the board of directors apparently covered for one of their own--British Executive Director Tom Scholar--when he was accused of having a conflict of interest because of a personal relationship with an employee at the bank. And we've seen how the bank has served as a well-paid sinecure for out-of-office politicians such as Dutchman Ad Melkert, who has moved comfortably within multilateral institutions making an enviable tax-free salary while performing incompetently and behaving dishonorably.
In a better world, the bank would shrink to perform only its core mission of helping the world's poorest nations. That's not going to happen, however, so the best that President Bush can do now to minimize the damage of the Wolfowitz putsch is by replacing him with someone who shares his agenda and will clean the place up. No European should have a chance to do that given what has transpired, not even Tony Blair. Nor should he name another well known member of the Council on Foreign Relations seminar circuit whom the Europeans and staff can quickly capture.
We've suggested former Federal Reserve Chairman Paul Volcker, who saw first-hand how these institutions function while investigating the U.N.'s Oil for Food scandal. But whoever it is, the core task of Mr. Wolfowitz's successor should be to clean the World Bank stables, or shut it down.
It is foolish and wrong to mourn the men who died. Rather we should thank God that such men lived.George S. Patton
[ edited by Bear1949 on May 18, 2007 07:08 PM ]
posted on May 18, 2007 07:44:23 PM new
World Bank Jobbery
More evidence the Wolfowitz accusers chose to ignore.
Tuesday, May 15, 2007 12:01 a.m. EDT
The World Bank board meets today to consider the fate of President Paul Wolfowitz, and the truth is that the verdict may already be in. The board will consider the report of an investigating committee dominated by the same European nations that have been orchestrating the media campaign to depose him.
As almost daily newspaper leaks have disclosed for weeks--in violation of bank rules--the committee concludes that Mr. Wolfowitz violated bank rules in awarding a promotion and salary increase for his girlfriend, Shaha Riza. We've previously reported on the World Bank documents that make it clear this was at worst a misunderstanding--if not a setup by bank officials who wanted his fingerprints on any raise for Ms. Riza. Mr. Wolfowitz had tried to recuse himself, only to be told he couldn't do so and would have to be the one to give her the raise and new job. (See "The Wolfowitz Files," April 16.)
But we've now seen two other documents that reveal the investigating committee's clear bias against Mr. Wolfowitz. They concern its key witness, Xavier Coll, the bank's vice president of human resources, who has joined those saying Mr. Wolfowitz dictated a raise he knew was excessive and then tried to cover it up. In his testimony, Mr. Coll claims that "there is no doubt that the President [Mr. Wolfowitz] knew or had been made aware of by me that this was outside the rules." The investigating panel relies heavily on Mr. Coll's claims to support its findings against Mr. Wolfowitz.
But to reach that conclusion, the committee had to ignore a pair of August 2005 memos in which Mr. Coll told a very different story. Mr. Coll dictated those memos for his own files and marked them "Strictly Confidential and Personal--For Xavier Coll's eyes only unless authorized explicitly by Xavier." They are a contemporaneous account of his negotiations with Ms. Riza and Mr. Wolfowitz.
In an August 22 memo, Mr. Coll reports that "I also felt that we were in a very difficult situation--with no precedent at the Bank--and that it had enormous potential to damage the Bank's reputation. In balance, I thought that the situation required more flexibility than in other past cases and that there was great risk to the Bank if we could not come to a workable agreement in a few days." Yet the investigating panel now asserts that the situation wasn't all that unusual and that Mr. Wolfowitz should have been allowed no such "flexibility" in how he tried to settle the matter.
In the same memo, Mr. Coll also reports that he had urged a lump-sum settlement with Ms. Riza as she left the bank, and concedes that Mr. Wolfowitz "agreed that I should raise this alternative with Ms. Riza. . . . I felt comfortable that I raised my points of concern with the President and that he has taken these seriously and given due consideration."
And regarding a later conversation Mr. Coll had with Ms. Riza, Mr. Coll wrote, "I indicated that while the President wanted to come to an agreement quickly (he was leaving that afternoon for an overseas trip) he also wanted to make sure that we came to the right solution, both for the institution and the staff." Mr. Coll added that Ms. Riza rejected his proposed "financial settlement."
Only then did Mr. Wolfowitz decide to settle the matter by dictating its terms to Mr. Coll. After Mr. Coll recommended that any future raises for Ms. Riza should be contingent on a review of her work outside the bank by "a committee of her peers," Mr. Coll wrote that "this addition brought the process for potential promotions more in line with current practice at the Bank. I felt that, on balance, this was a reasonable way to move forward and find a solution given the very complex and difficult set of circumstances."
Based on our fast reading late yesterday of the final investigating committee report, we could not find these quotes from Mr. Coll's memos. Yet they clearly show that Mr. Coll thought at the time that Mr. Wolfowitz was trying his best to come to a fair conclusion that would not harm Ms. Riza, would protect the bank from any possible litigation, and would do well by bank rules.
All of this is further evidence that what Mr. Wolfowitz is facing here is a kangaroo court. The Europeans and bank staff thought they could get him to leave quietly if they smeared him and Ms. Riza enough in the press. But now that he has fought back to clear his name, the Europeans led by Dutch politician Herman Wijffels have decided to ignore evidence to justify their one-sided conclusions. They also largely ignore Ms. Riza's own statements to the committee while condemning her for objecting to a process that all but ended her career at the bank.
So now the full 24-member board will take up the case, even as European ministers try to browbeat the White House and Treasury to get Mr. Wolfowitz to resign as part of some "plea bargain." But what does Mr. Wolfowitz get out of that--except more leaks saying he left under a cloud?
President Bush should understand that none of this is about Mr. Wolfowitz's "ethics." It is all about the European desire to punish a Bush appointee for his support for the Iraq war and his determination to change the bank's policies to fight corruption rather than simply push taxpayer money out the door. If the board really wants to oust Mr. Wolfowitz, the White House should insist on a recorded vote. We wonder if Europeans really want this showdown.
And oh, yes: President Bush could also help by declaring that, if the Europeans do oust Mr. Wolfowitz, his likely choice as a successor would be Paul Volcker, the former Fed Chairman who has made a recent career of fighting corruption. There is certainly a lot of that to clean up at the World Bank.
It is foolish and wrong to mourn the men who died. Rather we should thank God that such men lived.George S. Patton
