Saving the World Bank

Abstract

IN THE PAST five years, the world has created the International Crim inal Court; the Global Fund for AIDS, Tuberculosis, and Malaria; and the Kyoto carbon-trading system. Scarcely a month goes by without statesmen, high-level commissions, and civil-society activists calling for the creation of yet another institution: to manage postconflict reconstruction, to handle sovereign bankruptcies, to supplement or supplant existing bodies such as the United Nations. World leaders have focused less, however, on sustaining the good global institutions already in existence. A case in point is the World Bank, where an incoming president will soon confront a nearly impossible challenge: saving the bank from the same caste of statesmen, high-level commis sions, and civil-society activists. After 6o years of operation, the World Bank is large and lavish; it does not exude an aura of fragility. Its main complex in Washington, D.C., is an extravagance of glass and steel-a contrast with the run down UN headquarters in New York, where part of a ceiling collapsed two years ago. The bank's projects encompass an extraordinary range of goals, from road building to female literacy efforts to civil-service reform, and are spread across almost ioo countries. The institution gives out around $20 billion in loans and grants each year, a volume roughly 25 percent greater than total U.S. aid, three times the size of Germany's aid program, and seven times the combined output of all the UN agencies (although, to be fair, UN and government aid programs