Focus on the Global South * The Development GAP * 50 Years Is Enough: U.S. Network for Global Economic Justice

The ten-year reign of James Wolfensohn as president of the World Bank ends this week amidst growing global poverty and inequality, a significant backsliding by his institution in critical areas of environmentally sensitive programming, and a growing resistance in borrowing countries to the unbalanced economic policies imposed on them throughout Wolfensohn's tenure.

"Wolfensohn came into office ten years ago promising to open up the World Bank to new ways of thinking," said Njoki Njoroge Njehu of the 50 Years Is Enough Network. "Yet as he leaves, the World Bank has committed to accelerated privatization, a renewed emphasis on major infrastructure projects like dams and pipelines, and continues to insist that the austerity policies of the 'Washington Consensus' be implemented by its clients. Wolfensohn may have won some reforms, but it is clear they made no difference in the end; the World Bank continues to be an agent of a global economic order that benefits the rich by afflicting the poor."

Wolfensohn has overseen the longest period of Bank imposition of economic "adjustment" policies -- privatization, liberalization, deregulation and budget austerity -- in the Bank's history. "It is little wonder that half-way through his time at the World Bank, Wolfensohn felt it politic to change the name of its unpopular structural adjustment programs. 'Poverty reduction strategies' was probably a little too Orwellian to gain much credibility in borrowing countries, however," said Shalmali Guttal of Focus on the Global South in India.

"Despite the rhetoric Wolfensohn's Bank employed, it, along with its sister institution the International Monetary Fund (IMF), has demonstrated an unshakeable commitment to policies that undermine domestic industry, cause unemployment, increase inequality, create ecological devastation, and make basic services and goods more expensive or unattainable for the world?s most vulnerable people", said Guttal. "As a consequence, borrowing governments in democratic countries are finding it increasingly untenable to go along with the World Bank and IMF. In Latin America governments are routinely turned out of office for kowtowing to these institutions, while in Asia governments are extricating themselves from their grasp by building alternative safeguards against future crises."

News that several Washington organizations that advocate for change at the World Bank are hosting a reception Thursday afternoon in a U.S. Senate office building in honor of Wolfensohn has bemused critics. "It is true that Wolfensohn put increased emphasis on talking to civil society groups," said Doug Hellinger of the Development GAP. "But the three most elaborate World Bank/civil society participatory exercises -- a joint field investigation on the impact of adjustment policies, and examinations of the environmental impacts of large dams and extractive industries investments -- all ended with the Wolfensohn walking away from the results, refusing to accept what his own staff, working in frameworks he helped design, had learned. There is a consensus among the thousands of civil society members who participated in these exercises that the Bank, and Wolfensohn himself, failed utterly."

Hellinger concluded, "The dangerous message to the World Bank?s next very controversial president, Paul Wolfowitz, is clear: give civil society access to your decision-makers without making consequential policy changes, embellish your initiatives with terms such as 'poverty reduction,' 'good governance,' and 'democracy,' and you will earn congratulations from civil society groups for imposing an agenda that continues to harm vulnerable people while enriching the privileged."

The organizations mentioned in this release have each published more detailed analyses of the Wolfensohn years:

"The Limits of Reform: the Wolfensohn Era at the World Bank," available at www.focusweb.org/main/html/Article609.html

"50 Years Was Enough," available at www.developmentgap.org/docs/50 years was enough.pdf

"Spring '05: Debt Talks Approach Climax While Wolfensohn Tends to Legacy," available at http://www.50years.org/cms/ejn/story/259