https://www.wsj.com/articles/mission-impossible-world-bank-11549411445
Condolences to our longtime contributor David Malpass, the Treasury Under Secretary who is President Trump’s choice to be the next president of the World Bank. He can expect bitter resistance from the bank’s bureaucracy and its clients to even mild reforms.
Mr. Malpass is well-qualified to run the institution that is supposed to help developing nations with grants and loans. He has spent much of his career working on development economics, starting as the Treasury official responsible for the World Bank in the Reagan Administration. He worked with Latin American countries at the State Department and most recently on Argentine currency and Chinese trade matters in the Trump Administration.
He is an evangelist for pro-growth policies including low taxes, spending control, stable money for the poor as much as for the rich, and the rule of law. This is controversial in some corners of the World Bank, where they measure success not by growth but by how much money gets shoveled out the door.
Readers may recall how the bureaucracy and European governments ran Paul Wolfowitz out of the bank in 2007 after he tried to use bank lending to fight corruption. The path of least resistance for a World Bank president is to do very little, attend conferences, and enjoy a salary free of paying U.S. income taxes.
Mr. Malpass did some good in his current position when he negotiated a $13 billion capital replenishment for the World Bank in 2017. The U.S. share was $1.2 billion. The terms include an annual cap on bank lending of $25 billion, which should force the organization to prioritize lending and keep it from demanding more cash anytime soon.