[OPE-L] Wolfowitz's world: easy easy money not so easy, chicks not for free

From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Sat Apr 14 2007 - 08:04:06 EDT

Hi Patrick,

All banks, like governments, have communications staff, not in the least
because banking depends on trust and public credibility. If you don't have
that, you don't get the money to play around with. Of course, the
communications section can quickly become a propaganda section. Ken Rogoff
told the FT: "President Wolfowitz's credibility is so badly compromised that
the board is eventually...going to have to force him to resign." A White
House spokesperson said "the president has full confidence in Paul
adding "we expect him to remain as World Bank president.'
http://www.ft.com/cms/s/875846d8-e9bc-11db-91c7-000b5df10621.html The White
House is thoroughly corrupt, and so it is no surprise that the thoroughly
corrupt US president and vice-president want to protect their corrupt US
cronies. There is no honour among thieves, but they stick together.

An FT editorial states:

"That the US has in recent years lost a great deal of moral credit around
the world is undeniable. But one area where the present administration has
been relatively forward-looking has been aid and development. It has raised
the share of gross domestic product spent on official aid to a still low
0.17 per cent, but that is well above the mere 0.1 per cent in 1999. It has
supported ambitious debt cancellation for the world's poorest countries
(sic.!). It has also, rightly, put much weight on the need to tackle
corruption and improve governance in aid recipients. The best justification
for placing Mr Wolfowitz at the bank was his determination to give this last
objective overriding priority (sic.!). It is possible to debate the wisdom
of this, since the quality of governance, albeit hugely important, is not
the sole determinant of development. But one point nobody can debate: if the
US has decided that this is what it wants the World Bank to achieve, it
cannot sustain a president who is no longer a credible spokesman for that
cause. To do so can only destroy yet more of its own battered moral capital.
It would be worse than a crime; it would be a blunder."

This is of course largely a whitewash, we are talking about a few crumbs
falling off the table and being grabbed by the poor, rather than being
recycled by the waiter and the cleaning staff, with the world media cheering
about the generosity of the rich. Wolfowitz has no working experience as
banker. But what is more revealing is, that the FT editor thinks that a
blunder (faux-pas) is worse than a crime. Why the rhetoric about a blunder
being worse than a crime? Because the crime might be a relatively "trivial"
incident, like a few million dollars falling off the back of a truck, while
the blunder really hurts you and your own people in public opinion, and that
could cost a whole lot more. In other words, the public image is more
important than the wrongdoing - what people believe about you, is vastly
more important than what is really true about you. Anybody who is working
constantly with the money of the rich or with taxpayers' money is going to
grab some of the loot for himself, and this is understandable and excusable,
so long as it does not become public knowledge. That's the morality.

Jude Wanniski gave a very good thumbnail sketch in Counterpunch of what I
called "Wolfowitz's world":

"If you want to know how Professor Wolfowitz got the job, follow the money.
That's what the World Bank is all about. (...) On paper, its function was to
lend money to developing countries to help them grow. Its real job has been
to serve the interests of the major money-center banks and the multinational
corporations who make the big bucks in World Bank development projects. The
Bank, which is really a "fund," persuades a poor country like Ghana, for
example, to build a new industrial complex in order make stuff for export.
It will lend the money to Ghana -- which it gets from global taxpayers
including you and me -- and arrange for the complex to be built by one of
the favored corporations in the military-industrial complex. The list always
includes Bechtel Corporation, Halliburton, and Kellogg Brown & Root, a
division of Halliburton. These outfits go in and build the projects because
the locals have no expertise. (...)  nice, little "doable" wars (Wolfie's
word), are meat and potatoes for the military-industrial complex. Instead of
squeezing nickels and dimes out of the taxpayers to persuade Ghana to build
a steel mill it doesn't need and can't run, even little wars run into the
billions. And everyone gets into the act. The arms makers who produce
airplanes, tanks, guns, jeeps and humvees get to blow up a country (like
Iraq) and Bechtel and Halliburton come in right behind to rebuild it. In
announcing the Wolfowitz appointment today, President Bush said the World
Bank is a big organization and Wolfowitz has experience running a big
organization, the Pentagon!! As far as the military-industrial complex is
concerned, Wolfowitz did a FANTASTIC job. He was only expected to plan for a
$30 billion war and he screwed up so badly that it is now a $200 billion
war, and counting. Anyone who can screw up that badly deserves a promotion,
to the World Bank. (...) There will of course be complaints from various
global diplomats about the obvious incompetence of Wolfowitz, just as there
were puzzled head-scratchings around the world about the incompetence of
Condi Rice as Secretary of State or John Bolton as UN Ambassador. But money
talks in all the places where the directors of the World Bank live, and they
will be advised to clam up by the local military-industrial money machines.
(...) Nor can we expect any complaints from Congress, because in one way or
another there is too much money at stake, too many reputations looking
toward bigtime lobbying jobs when its time to give up a seat in Congress.
(...) So you see why it makes perfect sense to have Wolfowitz at the World
Bank. He's terrific at doing wars, and wars are much more profitable than
nickel-and-dime industrial projects."

I am not arguing that all of the World Bank development projects are bad,
but a lot of them are. The main reason why, is that corrupt governments grab
tax money, and give it to the bank to lend out to other corrupt governments,
to finance projects which the local people did not want, and the real
financial beneficiaries of which are mainly corrupt foreign corporations who
have their sales staff stacked at every level of the process all over the
world to grab the recycled taxpayers' money, the use of which taxpayers gave
no mandate for. There is no accountability, because by institutional
definition there cannot be any accountability under those conditions.
The talk is about "development assistance", but it is just a gravy train for
wellpaid people who exploit popular feelings of charity and philantrophy to
line their own pockets with, and the pockets of their friends.

Anybody who knows anything about finance, also knows that the more you "lend
money to someone else to lend to someone else" etc. the more accountability
for what is actually done with the money goes down the gurgler. You create
more accountability in the first instance precisely by cutting out all the
middlemen that can be cut out, i.e. by cutting out as much financial
intermediation as you can.

Why do they talk about "governance" at all, do you think?


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