Treasury Officials Research Articles

Annals of Crony Capitalism: Revisiting the AIG Bailout

Cronyism may well be an intensifying problem in contemporary American capitalism, but an incorrect identification and labeling of crony capitalism subverts meaningful reform. Five years after considerable financial assistance was provided to the American International Group by the New York Federal Reserve Bank and the U.S. Treasury, the AIG bailout story remains highly controversial as a putative case of capitalism gone bad — crony capitalism at its worst. This paper reviews the record surrounding the AIG bankruptcy and argues that the bailout decision and the subsequent structure of the bailout tell a much different story than the one characterized as “crony capitalism.” Based on a close reading of this record, the story I tell is that the lingering controversies over the bailout are not a result of the corrupt behavior of Federal Reserve and Treasury officials. Rather, they are the result of impromptu and highly improvised risk management by government officials who had no clear regulatory authority over failing investment banks and insurance companies — like Bear Stearns, Lehman Brothers, and AIG — and who were conditioned by their professional training and current responsibilities to focus on the worst-case scenarios following the collapse of large financial institutions holding fast-depreciating real estate assets. Operating under severe time constraints and existential anxiety, mistakes and missteps were made by the New York Fed in its unfamiliar role as the chief restructuring officer of AIG. But this is far different story than calculated corruption benefiting large domestic and foreign banks vulnerable to an AIG collapse. This essay is a cautionary tale about exaggerated (and false) claims of institutional corruption in the public and private sectors. We are currently witnessing a sufficient number of cases of both unlawful and lawful-but-corrupt behavior to motivate a debate about meaningful reforms. Inaccurate characterizations of institutional and individual behavior can only serve to contaminate this important conversation.

Why didn't they See it Coming? Warning Signs, Acceptable Risks and the Global Financial Crisis

In the immediate aftermath of a crisis, one of the most damning and penetrating questions asked of political leaders and senior state officials by the media, opposition parties and other actors is: ‘why didn't they see it coming?’ The question is often rhetorical, the implication being that warning signs were clear and should have been acted upon. In this article we identify the assumptions underpinning the ‘why didn't they see it coming?’ narrative as it has been expounded in relation to the global financial crisis in the UK and US. Since 2008 commentators have routinely argued that warning signals of an impending financial crisis were ignored by political elites, treasury officials and financial regulators. Such arguments are made in hindsight and we refer to them as backward mapping perspectives. In this article we advance a counter-narrative, from a forward mapping perspective, where the focus is on placing such ‘failures' in the context of the time, without foreknowledge of the crisis that would happen. Accordingly, we argue that warning signals that, with the benefit of hindsight, now seem obvious, were actually ambiguous and fragmented because they were received and interpreted within a very different ideational environment.

Financing for public Veterinary Services to ensure that they meet international standards

It is vital that public Veterinary Services develop the skills to address the challenging questions posed by national Treasury officials, who exercise an important mandate to ensure that expenditures are efficient and effective in serving the public interest. Examples of such questions are considered in this paper, along with systems and strategies for preparing for such reviews, including the use of the Performance of Veterinary Services (PVS) evaluation tools of the World Organisation for Animal Health. Some lessons and observations are drawn from PVS Evaluation and PVS Gap Analysis missions in nine countries.

An historical perspective on the forecasting performance of the Treasury Model: forecasting the growth in UK consumers’ expenditure

Drawing upon Treasury Official Economic Forecasts Vols. I & II, a series of Treasury Model (TM) forecasts of the percentage growth in real total consumers’ expenditure are derived for the period 1967 to 1989. The one-, two- and three-step ahead forecasts examined cover an interesting period which includes major shocks to the UK economy, business cycle effects and changes in economic policy. Whilst a battery of forecast evaluation statistics and tests do not detect any evidence of forecast bias or irrationality over the whole sample, split-sample analysis provides evidence of a switch from overprediction to underprediction around 1977. In addition, the application of ‘modified’ versions of Holden–Peel (1990) tests provides evidence of the longest horizon forecasts failing to capture the full movement of changes in consumption growth. Using simple regression and a selection of forecast encompassing tests, shorter horizon forecasts are found to dominate longer horizon forecasts, a feature which might be expected logically, but need not occur in practice. Finally, forecast performance is related to changes in model specification and modelling methodology.

Treasury and Economic Policy - Beyond the Dismal Science

‘Treasury advises and assists the Treasurer, and through him the Government, in the discharge of his and its responsibilities in relation to economic, fiscal and monetary matters. The Department's main responsibilities lie in the field of general economic management’, Treasury, Annual Report 1983. ‘The Treasury's mission is to improve the wellbeing of the Australian people by providing sound and timely advice to the Government, based on objective and thorough analysis of options, and by assisting Treasury ministers in the administration of their responsibilities and the implementation of government decisions’, Treasury, Annual Report 2010a. ‘You can't really evaluate the performance of Treasury in terms of “outputs and outcomes” in any formal or public way because most of the time we are dissuading Treasurers and governments from doing stupid things’, Senior Treasury Official 2000. ‘We once had a “Treasury line”, but now we are more pluralistic’, Senior Treasury Official 2010. ‘Treasury's executive board hunts as a pack, they trust each other and they’ve known each other for long times’, Senior Treasury Official 2010.

A Marriage of Convenience: Citibank, Hawke-Keating Labor and Foreign Bank Entry into Australia

This study explores the long- and short-term backdrop to the Hawke-Keating government’s decision in 1984-85 to include the US banking giant, Citibank, in the select group of 16 foreign banks granted an Australian banking licence. Such a development ran counter to decades of mutual distrust between the Australian labour movement, large foreign banks in general, and US multinational firms in particular. It was also by no means inevitable. Citibank’s success is attributable neither to structural imperatives per se nor to superior strategic acumen. Rather, it derived from a shifting long-term interplay between structural factors, strategic and ideological intent and chance events. In particular, we highlight Citibank’s emergence as a significant player in non-bank financial services activity in Australian during the 1960s and ‘70s, an emergence that reflected persistent lobbying, well-timed market intervention, and serendipity. Equally, we argue that Federal Labor’s ultimate embrace of selected foreign banks, and of Citibank in particular, is best understood as a marriage of convenience. We also present evidence to show that the outbreak of amity between Labor and Citibank was by no means assured and that the immediate backdrop involved a complex process of positioning, probing, stand-off and trade-off between Labor neo-liberals, Reserve Bank and Treasury officials and Citibank executives.

The Financial Crisis: An Inside View

This paper reviews the policy response to the 2007–09 financial crisis from the perspective of a senior Treasury official at the time. Government agencies faced severe constraints in addressing the crisis: lack of legal authority for potentially helpful financial stabilization measures, a Congress reluctant to grant such authority, and the need to act quickly in the midst of a market panic. Treasury officials recognized the dangers arising from mounting foreclosures and worked to facilitate limited mortgage modifications, but going further was politically unacceptable because public funds would have gone to some irresponsible borrowers. The suddenness of Bear Stearns' collapse in March 2008 made rescue necessary and led to preparation of emergency options should conditions worsen. The Treasury saw Fannie Mae and Freddie Mac's rescue that summer as necessary to calm markets, despite the moral hazard created. After Lehman Brothers failed in September, the Treasury genuinely intended to buy illiquid securities from troubled institutions but turned to capital injections as the crisis deepened.

Buybacks in Treasury Cash and Debt Management

This paper examines the use of buybacks in Treasury cash and debt management. We review the mechanics and results of the buyback operations conducted in 2000-01, during a time of budget surpluses, and assess the prospective use of buybacks in the absence of a surplus. Possible future applications include (i) managing the liquidity of the new-issue markets when deficits are declining (by allowing Treasury officials to postpone a decision to discontinue a series without also being compelled to shrink new-issue sizes); (ii) actively promoting the liquidity of the new-issue markets (by repurchasing outstanding debt on a regular basis and funding the purchases with larger offerings of new debt); (iii) limiting the accumulation of large Treasury cash balances (for example, in the second half of April and early May, when many taxpayers make final payments of taxes on income earned in the prior year); and (iv) smoothing week-to-week fluctuations in Treasury bill offerings.

Unions call for real cost rise as government misses pay deadline

Union pay negotiators fear interference by Treasury officials after the Department of Health (DH) missed last week’s deadline for submission of evidence to the pay review body (RB). But a DH spokesperson said: ‘We are still working on it.’

The Traffic in Indian Slaves in the Province of Pánuco, New Spain, 1523-1533

After The Fall of Tenochtitlán in 1521, the focus of Spanish attention was quickly shifted to the peripheral areas of New Spain. One of such areas, variously known in colonial times as Panuco, the Huasteca, or Vitoria Garayana, was conquered by Cortés in late 1522 or early 1523. In the spring of 1523 the Conqueror founded the villa of Santisteban del Puerto on the Panuco River; granted encomiendas to some one hundred Spaniards; and returned to Mexico City. Despite an early challenge by Francisco de Garay, the governor of Jamaica, Pánuco was administered by Cortés or the royal treasury officials of New Spain until May, 1527. At this time the crown appointee, Nuño Beltrán de Guzmán, arrived in the province with the title of Governor of Panuco which he held until the last months of 1533. In the pages that follow, an attempt will be made to present evidence relating to a decade of slaving in Panuco. This will involve the activities of both Cortés and Guzmán, as well as some traditional accounts relating to the topic. The author wishes to state at the outset that he is neither defending nor prosecuting the moral issue of Indian slavery.

Transformations

Transformations

New revisionists and the Keynesian era: an expanding consensus?

are a useful Keynesian standard against which to measure policy and that the dominant discourse in economic theory in Britain from the 1940s to the 1970s was Keynesian. Neither of us doubts that the making of economic policy resulted from a complex interplay of economic, political, and personal factors. We share the conviction that seeking to understand that process by means of explicit tests is fraught with difficulty. Peden has made some criticisms of the methodology of my approach to measuring Keynesian influence on British economic policy, most of which seem eminently sensible. However, his assessment of the practicality and effects of policy still mystifies me. I The making of macroeconomic policy implies decisions made by politicians on the basis of advice from generalist Treasury officials who in turn were and are able to turn to professional economic advisers, whether inside or outside Whitehall. The problem for the substantial literature on Keynesian ideas and macroeconomic policy is to disentangle whether economic advisers within the Keynesian tradition managed to influence the final decision-takers, with the added complication of defining precisely what 'Keynesian' means. These difficulties are controllable in the period from roughly 1920 to 1946 when Keynes was (just about) the only authoritative 'Keynesian' adviser. However, they become exceedingly difficult thereafter with the rapid multiplication of authoritative Keynesian voices and the emergence of peacetime economic problems that Keynes had not confronted. As the existing literature had sometimes been less than explicit (to say the least) on analytical approaches, I proposed a simple test; macroeconomic policy could be termed Keynesian if decisiontakers followed advice from the Keynesian economists in the Economic Section, Whitehall's primary source of internal professional economic advice. Peden lists four main difficulties with this method. The first is under-valuation of politicians and advisers outside the Economic Section. If the role of ministers appears undervalued, that was certainly not the intention. The aim was to present an account of interactions between ministers, generalists, and Whitehall's specialist

Beneméritos, aristócratas y empresarios: Identidades y estructuras sociales de las capas altas urbanas en América hispánica

These 15 essays were presented at a namesake symposium in Cologne in December 1998. Identidades implies the cultural, the mentalité. In a Hispanic context, as Frédérique Langue reminds us, that signifies a craving for ennoblement through martial prowess. In fact, most papers highlight an elite dynamic based on migrants, money, and matrimony. Understandably, the anthology’s four-fold division—into core areas, border areas, long-term vertical studies, and lesser centers—does not relate to the content of the several contributions.Two studies appear misplaced: Pedro Guibovich Pérez’s on Lima chronicles, for its irrelevance; and Susan Socolow’s advice on refining research as too scant. Four are general summations. John E. Kicza sure-footedly reviews the Mexican elite through 1700: About 50–60 households of encomenderos and merchants, all rich and centrally located, and staying on top through diversification and endogamy. Barbara Potthast lucidly surveys Paraguay’s ruling mestizos whose autonomy relied on their isolation and conquistador ancestry. In the eighteenth century, they succumbed to plebeian discontent and to commercialization, but held on in the countryside. Proud yet “illegitimate,” these mancebos de la tierra founded the national ethos. Germán Cardozo Galué and Arlene Urdaneta de Cardozo offer a clear, two-dimensional history of Maracaibo through 1870. Its political theme is the losing fight for autonomy; the social a continuous reshaping of the capa alta, by Basques and Catalans before 1800, Englishmen in the 1820s, and Germans in the 1840s. Listing old and new lineages, Arturo Sorhegui traces the sixteenth-century rise of the Havana-based señores de hato and of their seventeenth-century replacement by Andalusian merchants and crown officials. A prolix prelude, going back to Spain’s reconquista, presumes to provide the proper historical perspective.Two scholars rely on new work by colleagues. Cristina Mazzeo de Vivó previews a cooperative study of eight leading Lima merchants from northern Spain, 1760–1820. Their marriage strategies mixed wealth-preserving inbreeding with prestige-enhancing links to older clans. These strategies survived Napoleon, but the divisive war of independence ruined five out of the eight. María Rosaria Stabili sums up Los vascos en Chile (1998), by Trinidad Zaldívar and her coauthors. The book identifies 418 Basques who entered Chile between 1680 and 1820 and refounded Santiago’s elite. Stabili parses the mercantile and matrimonial linkages of Basque progress, then the ideology of the renewed establishment. Money was required to join but its values centered on sobriety, service, culture, and the Basque sense of hidalguía.The remaining five invited presenters may be grouped in a roughly ascending order of novelty. Inés Quintero embraces the estamento nobiliario in Venezuela (actually Caracas). Singularly free of intruders, her titled linajudos exploit “the wise” 1776 pragmática to prevent “slippery marriages.” Michel Bertrand’s essay presents eighteenth-century Mexico through a prosopography of treasury officials. Most were Peninsulares from humble backgrounds, but they married wealthy. Juan Pablo Ferreiro’s detailed chronicle of early Jujuy is a tale of Montagues and Capulets—the Argañarazes and the Zárate-Ovandos—ending happily por vía matrimonial. Poor and small, Jujuy enjoyed “limited democracy” in the “progressively eliticized” cabildo, where the feud was fought. For Bourbon Zacatecas, Frédérique Langue features the upward path of immigrant Fernando de la Campa Cos from war-won land grants and knighthood. His kin married powerful officials and wealthy miners. As a count and a patriarch, he supervised investments, marriages, and mayorazgos. In addition, he insured his regional control through godfather-hood, loans to entrepreneurs, gifts to the king, and shelter for outlaws. Chantal Cramaussel had the original idea of locating—via the death registers of baroque Parral—the ten men who controlled the most workers. These ten apparently dominated the mine. Only two were Mexican-born, a mestizo and a mulato. However, all of them married norteñas—prerequisite to their long-term success, and a safe bargain for their local in-laws.The contributions of the conference sponsors appear at the end of the book. Bernd Schröder supports his picture of patrician Montevideo from archival sources —parochial, notarial, judicial, confraternal—and schematizes his findings in five tables and nine graphs. The latter demand statistical training and good eyesight. His emphasis on the titles of don and doña might also be questioned, but not his conclusion: By 1800 elite Peninsular merchants equaled the number of elite estancieros, half of whom likewise came from Spain. Christian Büschges applies a Weberian Idealtyp of nobility to late-eighteenth-century Quito. Down on its obrajes and trade, the 20-odd-thousand-strong city boasted 500 self-styled nobles, led by 10 títulos and 13 hábitos. Public office confirmed status. Landholding supported a noble lifestyle but no prestige accrued from mere gain. In their “Final Reflections,” Büschges and Schröder supply a tipología esquematizada of elite growth and identities. Theirs is a Sisyphean attempt to fit the several pieces, but it does not detract readers from this worthwhile variorum.

‘Sir Douglas in Euroland’. Treasury officials and the European Union, 1977–2001

‘… every man is a piece of the continent, a part of the main; if a clod be washed away by the sea, Europe is the less …’John DonneThe European Union (EU) is now, in the author’s view, a pervasive part of the UK Treasury’s culture, much more than is generally recognized. Drawing on personal experience as a Treasury official, the author describes the impact of the EU on the Department’s culture, organization and work. Relations with other departments, finance ministries in other member states and the EU institutions are examined in order to demonstrate the depth and complexity of Treasury involvement in the EU. Key policies are discussed, to illustrate how Treasury culture has changed in recent decades.

Engendering Economic Policy: The Women's Budget Group

In these days, when feminist theory has been replaced by gender theory and activism by the practice of deconstruction, it is refreshing to find a group of women academics and voluntary sector campaigners coming together to engage with day-to-day issues of economic and social policy. Such is the London-based Women's Budget Group (WBG), which has set itself the task of creating a dialogue with treasury officials and ministers. Many of the issues have not changed much since 1974, when the Women's Liberation National Conference adopted the 'fifth demand' - legal and financial independence for women - and the London Women's Liberation Campaign for Legal and Financial Independence (commonly known as the 'fifth demand group') started working on the tax, benefit and pensions policies that treated husband and wife as a breadwinner-dependent couple with no need of separate incomes. The style may have changed: the fifth demand group used to alternate its more business-like meetings with consciousness-raising sessions, and go away together for weekends and days out in the country, whereas the WBG does much of its communicating by e-mail. The fifth demand group never even contemplated employing anyone or applying for funding or recognition; the WBG has administrative backup from the Women's National Commission, which is autonomous but located within the Cabinet Office, and at present has funding from the Barrow Cadbury Trust to employ a part-time project manager. The fifth demand group met in the living rooms and kitchens of suburban flats and collective houses; the WBG holds its meetings in the corridors of power in Whitehall, thanks to the Women's National Commission. The fifth demand campaign was an eclectic mixture of the presentation of arguments to the ruling establishment and more populist agitation. It gave evidence to parliamentary select committees, to official inquiries and to the Royal Commission on the Distribution of Income and Wealth; it produced an accessible and forcefully argued pamphlet and discussion pack--'The Demand for Independence'--that circulated widely among feminist groups (no longer available, but see London Women's Liberation 1979); it launched the YBA Wife campaign that attracted a flurry of media attention and an enormous post-bag in 1977. The WBG, on the other hand, has the ear of government; it has regular meetings with treasury officials and some nowadays with treasury ministers; it produces a detailed critique of the annual pre-budget report and a response to each year'sbudget; periodically it holds public meetings that attract back-bench and front-bench MPs, social affairs journalists, social policy experts and people active in related campaigns (most notably the one reported in Robinson 1998). In the intervening decades, much of what the fifth demand group campaigned for has been achieved. Husbands and wives are now taxed separately and the married man's tax allowance has been abolished. Married women can no longer opt to make more limited national insurance contributions in return for more limited rights to benefits. People who are married or cohabiting still cannot claim means-tested benefits separately from their partner; but at least either one of them can now be the claimant, rather than just the man. So the assumption that women are dependent housewives has been gradually eroded, but is far from being destroyed.

An alternative to geopolitics

The security agenda for the Asia—Pacific has been overshadowed in recent years by a prolonged financial and growth crisis in the region, which has brought severe hardship to the more vulnerable sectors of society, especially in Indonesia. These developments have also generated unprecedented criticism of, and even self‐criticism by, the main advocates of neoliberal medicinal solutions, including U.S. Treasury officials and high officers in the IMF and World Bank. One positive result is greater receptivity among the governments of the region to a more people‐oriented approach to economic policy. Also critical for the formulation of any future regional security policy was India's decision to conduct nuclear weapons tests in April 1998, with Pakistan quickly following suit. These explosions triggered angry reactions from many governments, especially from the U.S., which has demanded a nonproliferation regime from non‐nuclear states while refusing nuclear disarmament for itself and other nuclear‐armed states. The Indo‐Pak nuclear explosions raised the danger of an Asian nuclear confrontation and a regional arms race, especially if India's weapons are being developed, as some allege, with China in mind more than Pakistan. Such heightened regional concerns arose when the Asia—Pacific governments were struggling to apply their scarce resources to the dual challenge of addressing citizen needs while also restoring economic normalcy in the aftermath of the dramatic declines of the last several years. Against such a background, we must consider two major issues: first, the new geopolitical threat that challenges prospects for real security in the Asia—Pacific region, and second, a possible alternative security framework.

Conditional fee agreements: the courts and parliament in unison

THE developments noted here show that conditional fee agreements have become a significant, perhaps even the dominant, means of securing access to civil justice. The political popularity of such agreements is not hard to explain. Since 1949, civil legal aid has enabled the less well-off to litigate in the ordinary courts. But it is notorious that many people are excluded from justice, either because they are deterred by the size of the potential contribution to a legally-aided action or because their modest means disentitle them altogether from that system. Furthermore, legal aid is perceived by Treasury officials to be an excessive drain on the fisc.

Controversies in primary care. Setting prescribing budgets in general practice. Capitation based prescribing budgets will not work.

# Controversies in primary care Setting prescribing budgets in general practice {#article-title-2} General practice prescribing costs have risen rapidly in recent years, and there are wide variations between practices in...

The business of alchemy: science and culture in the Holy Roman Empire (review)

178 Reviews Persia were not premeditated. His drive to power amongst the Mongol tribes and their neighbours was a product of his youth, a consequence of childhood hardships and misfortune, and was impelled by traditional Mongol values of thirst for power and ineluctible desire for vengeance for insults and injuries suffered. However, his later campaigns against the Chin (Jurghid) and Xi-Xia (Tangut) dynsaties in northern and western China respectively, and against the Khwaram-Shah 'Ala-ad-DTn M u h a m m a d were the product of slights, whether real or imaginary does not really matter, against him or his subjects. The Mongol rise to world dominion was not premeditated but rather was a product of ad hoc responses to piece-meal situations. This is a fascinating book, made comprehensible to the general public by its editor and translator, who is to be congratulated on his choice of text and the 'popularizing' efforts which he has undertaken at much greater expense of time and effort than can normally be expected from translators. John H. Pryor Department of History University of Sydney Smith, Pamela H., The business of alchemy: science and culture in the Holy Roman Empire, Princeton, Princeton University Press, 1994; cloth; pp. xii, 308; 30 illustrations; R.R.P. US$45.00. Written in the tradition of R. J. W . Evans's Rudolph II and his world (1973) and Bruce Moran's The alchemical world of the German court (1991), Pamela Smith's book clearly and intelligently illuminates the interaction which occurred between the spheres of alchemy, commerce, and the court in the Holy Roman Empire of the sixteenth and seventeenth centuries. Smith explores this subject by focusing on the intellectual biography of Johann Joachim Becher (1635-82), an adept of alchemy/chemistry and the material arts. Becher was passionately concerned with both the reform of knowledge and with the introduction of the forms and activities of commercial enterprise into the domain of the landed court. His great plan was to draw the productive knowledge of material things, which involved commerce and the mechanical arts, into the realm of politics and the court: a realm whose practices were based on very different principles from those of the mobile and 'suspect' world of commerce. The capture of productive knowledge to generate income through commerce was Becher's solution to the court's ever Reviews 179 present need to create surplus wealth. Becher stated that he could provide by this means revenue which the 'cameralisten', the treasury officials, could not. He insisted that he had on his side the knowledge of the principles of generation and production by art, and the genius of invention, both of which had the power to create wealth, something which the existing treasury and the sterile words of scholars could not accomplish. He advocated that a new type of financial advisor was needed, a person who had more in common with the hermetic philosopher with his knowledge of practical chymistry and the secrets of generation, than with the Aristotelian philosopher, whose useless words were incapable of producing wealth. Like Samuel Hartlib in England, Becher wanted to draw alchemy into the public arena and, as with Hartlib's plan for the reform of knowledge, an alchemical laboratory was to be the centre-piece of Becher's projected plan for a Kunst-und Werckhaus designed to shelter and train the vagrant population of the Habsburg lands. In order to be able to communicate to his patrons the alien idea of material increase through production and commerce, Becher required a new discourse: one which could penetrate the rhetorical conventions of the court. This discourse he found in the language of alchemy. By employing alchemical images of regeneration and multiplication, by symbolically using the figure of Hermes/Mercurius in his multiple roles of agent of transmutation, regenerator and multiplier of gold, and patron of merchants and trade (the word 'merchant' is in fact derived from Mercurius), Becher was able to make comprehensible to the emperor the world of commercial profit. In his appropriately mercurial role as the great networker and the mediator between praxis and practice, Becher eventually became 'an interpreter of social forms existing outside the...

The World Health Organisation in Africa

In September 1994, there will be a crucial vote in international public health: the nomination of the World Health Organization (WHO)'s next regional director for Africa. The appointment will affect how $850 million is spent and what happens to the health of 550 million of the world's poorest people. The current regional director, Dr Lobe Monekosso, took office 10 years ago, and just over half of the region's $136 million budget for 1992-3 reached the region's 45 member states. The rest of the budget was spent at the regional office in Zaire, along with 2/3 of the 112 million pounds sterling donated for the AIDS and immunization programs. Chronic difficulties caused by Africa's lack of infrastructure have been aggravated by civil unrest in Brazzaville, where the regional office is based, which prevented the WHO's auditors from evaluating biennial spending. The main contender for the post is Dr. Ebrahim Samba, director of the onchocerciasis control program, who took over the ailing program in 1980 and has turned it into a success. From its base in Ouagadougou in Burkina Faso, it has cut the prevalence of onchocerciasis as a public health problem in 11 West African countries from 95% in 1974 to less than 5%. The appointment will be decided by the regional committee, which is made up of health ministers of the region's 45 member states, and the incumbent has the upper hand. Regardless of the result of the regional committee meeting in Brazzaville, the time has come for a thorough review of the effectiveness of the WHO in Africa to reassure those treasury officials in donor countries waiting to withdraw their funds. The WHO needs to reform its selection procedures and make its regional directors more answerable to the World Health Assembly; in this way it will eliminate the existing potential for too much power combined with too little accountability.