Why Bill Easterly believes that all candidates for World Bank President should be given more time to engage in a public debate:
A public forum allows many different minority viewpoints to be heard. Indeed, the backlash against Kim has generated its own backlash. The point of a forum is not to privilege Kim's critics but to let both sides speak. Debates between opposite viewpoints are crucial to any democratic process, preventing "groupthink"; even when the dissidents are wrong, they force those with the right view to make their case. The CGD/Washington Post forum was transparent (the sessions with Okonjo-Iweala and Ocampo were both live-streamed and posted afterwards on the internet). Kim's discussions with global leaders were not transparent.
Imagine a nominee with controversial environmental views or credentials were in the frame to lead America's Environmental Protection Agency (EPA). It's unlikely the administration would say the nominee was so busy meeting members of Congress behind closed doors that he or she had no time to consult with environmentalists.
Read the entire piece, published this afternoon, in The Guardian.
By Gregg Gonsalves Lant Pritchett—a Professor of the Practice of International Development at the Harvard Kennedy School—has been leading a campaign against the election of Jim Kim to the World Bank presidency. While he isn’t the only critic of Dr. Kim’s nomination, he is among the most vocal, prominent and well known. Though his views are his own, many of them have been amplified and echoed by other leading development economists like William Easterly at New York University and several people associated with the Center for Global Development in Washington, DC.
Over the past few weeks, Pritchett has questioned Kim’s qualifications, saying a lack of training in economics and experience in world finance should disqualify him from consideration for the post. He has further suggested that the nomination is about the arrogance of American power and hegemony over the institution and that he should step aside for a merit-based election in which the Nigerian candidate for the post, Ngozi Okonjo-Iweala, a World Bank, Harvard and MIT alum and finance minister of Nigeria would sweep to victory.
A few days ago, Pritchett wrote an article in the New Republic, which finally comes clean about the real reasons for the escalating, grasping campaign of opposition to Jim Kim. The piece for the New Republic (TNR) is called Why Obama’s World Bank Pick Is Proving So Controversial. The title again is an overreach: it should really read why Obama's World Bank Pick Is Proving So Controversial to Me and My Friends. Again, while Pritchett’s views are his own, his article has resonated with other development economists, including Easterly, who have circulated links to it over the past few days. Pritchett’s piece has clearly struck a nerve among his peers.
Jim Kim has extensive support around the world for his candidacy, but it is vital for us to understand Pritchett’s objections to Dr. Kim as it all really boils down to what we think "development" is, what all of our work is about in our countries, whether we live and work in poor, middle-income or even rich nations. Pritchett in the TNR posits two kinds of development: national development and humane development.
National development "would involve the natural replication of the four-fold historical transformation of the developed nation-states: Economies would become more productive and hence support broad-based prosperity, polities would become more fully responsive to their citizens, administration would become more capable, and societies would become more equal as birth-based distinctions (such as class and caste) and divisive identities (of kith and clan) faded in favor of modern social relationships. Note that each of these was something that would happen not just to individuals but to a country."
Pritchett goes on to define humane development as a kind of philanthropy, where people step into the breach where national development has failed, where “these idealists and the organizations they run have helped to mitigate famines, pandemics, poverty, violence, and lawlessness in some of the poorest areas in the world.” Jim Kim is a humane development type in Pritchett's eyes, not fit to run the Bank, which should focus on national development alone, an approach that Ngozi Okonjo-Iweala, a card-carrying economist would bring to Washington, DC. However, Dr. Pritchett who has been a leader in the field of modern national development is deeply myopic.
First, while many people have been lifted out of poverty over the past century due to economic growth, inequity is pervasive and we are well on our way to creating a new transnational economic elite or rich people without borders. The birth-based distinctions and divisive identities that Dr. Pritchett rightly decries are being replaced by class-based ones. However, when you worry mostly about growth in the aggregate, the little people don't matter.
Second, political responsiveness and accountability, better governance and administration have been integral to those of us who work on health and other issues that are not directly about economic growth and achieving the aims of national development can come through work on things other than economics and democratization in the abstract. In fact, the fight against AIDS has been transformative in this regard. As the South African journalist Jonny Steinberg has said in his book Three Letter Plague: “The idea of demanding that a drug be put on a shelf, or that a doctor arrive at his appointed time, is without precedent. The social movement to which AIDS medicine has given birth is utterly novel in this part of the world, the relationship between its members and state institutions previously unheard of.”
AIDS has been about accountability and state responsiveness, about better governance and administration. Pritchett has previously and vociferously complained about the provision of ART in the developing world as a prime example of palliative humane development, misguided philanthropy, but for those of us who have watched more closely this has all been about key aspects of national development, about "polity, administration, and society," as Pritchett himself terms it.
For Pritchett and his peers, Jim Kim is a crazed, lefty, charity worker who pushed pills on Africa--this is why they dislike him so. They refuse, again and again, to see what Kim did, what we all did, as critical to their own self-professed goals around democratization. The push for AIDS treatment was not charity or mitigation, but all about what governments should do for their citizens; it was about redefining citizenship and state responsibility.
Why do they have such an inability to see this? Well, because I think there is something else going on. Over the past several decades there has been a push from those working at the highest levels of economic and social policy around the world to redefine state responsibilities downwards. The historian Tony Judt described this well in his book Ill Fares the Land. We're seeing a renegotiation of the post World War Two social contract, which enshrined a system of social protections around the world, in Europe, Canada and Australia and even in the USA, which offered a safety net for the poor and the sick and saw this safety net as a core responsibility of the state.
In 1935, John Maynard Keynes said: “the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.”
Nowadays, from Clinton's "welfare reform" in the 1990s, to the current, slow dismantling of the NHS in the UK by David Cameron and Nick Clegg, states are getting out of the business of helping the poor and the sick. These political choices derive from larger intellectual frameworks constructed largely by economists where things like healthcare are not a "public good,”—they are like a loaf of bread, one eats it on one's own—and states should only invest in what provide broad based benefits, key among them economic growth and defense. In our brave new world, the models for national development are the states of austerity-crazed Europe and a USA in the mind of Republicans, where we are slashing social protection programs, cutting public spending, all in the appeasement of the gods of growth.
For people like Lant Pritchett and a generation of development economists like him, all heirs to Thomas Malthus, you can't have it all or anything nearly like it. We have to promote growth and democratization, even if it creates a new caste system based on inequities in wealth within countries or a new-class of have-nots, as in have-not healthcare, have-not education. ''AIDS is a catastrophe,'' Dr. Pritchett told the New York Times several years ago. ''And it's not fair, if treatments exist, not to give them to all these people who are dying. But it's also not fair that more than a third of children in Africa are malnourished. It's not fair that maybe 140 babies in every 1,000 will die before the age of 1, and more than a third will never learn to read. All of it is unfair. Unfairness is not the test for action.'' For Dr. Pritchett the test for action is about economic growth. We wait for AIDS drugs, we wait for better schools. It will all come along if we all just wait for growth and democratization--as they write about in the textbooks--arrives like manna from heaven.
Our work in AIDS, Jim Kim’s work in AIDS, on TB has been about transforming the world for the better, not out of some charitable impulse, sneered at by Dr. Pritchett, but because we have a vision for what the world should look like, about what governments should and should not do for their people; about what to expect from, what we can demand in terms of delivery of public services; about our role as active citizens, not waiting for experts or politicians to come and save us. This is national development, about polity, administration, and society. But it really doesn't matter to Dr. Pritchett—we have all made a cardinal sin, which was to ask too much of our leaders, to question whether some idealized notion of free markets and free elections are all we need be asking for to secure a future for our children, whether the prescriptions of economists will deliver in the end for ordinary people.
Economists have gotten a bad rap lately, with so many of them having been so spectacularly wrong about so many things around the origins of the current worldwide economic crisis and its aftermath. Some of this in the end is about economics status as a science, about protecting a discipline that is deeply political, but strives to cloak itself with objectivity. Someone like Jim Kim, trained in the biomedical sciences, trained to rely on hard endpoints, is a threat is a more fundamental sense, as he doesn't take the laws of economics as equivalent to the laws of gravity, to the central dogma of molecular biology or the germ theory of disease.
To be fair, there are economists who recognize that their field is contingent, more inexact, and are raising serious questions about the rigor of their assumptions, about over-reliance on models, the need for a far better quality of evidence, far beyond the sub-specialty of global development. These are the kinds of people, the fresh voices and thinking, one could see coming to the Bank under Kim’s leadership. Kim is also trained as an anthropologist as well; he knows there a variety of tools with which to see the world as long as you know their limitations. Dr. Pritchett and his colleagues don't have this humility, they have their certainty, that they know what is right, what is needed, what should be done. This is what scares me most of all.
In the end, Jim Kim represents a national development perspective, but a critical one. For Pritchett, national development is about economy, polity, administration, and society. Kim’s work has certainly centered around the last three of these and he will bring a critical eye to the first. I am sure Ngozi Okonjo-Iweala is brilliant. I am not quite sure she represents much more than a reification of traditional ideas about development, has sufficient distance from things to offer a critique, bring change. She is the establishment’s choice, even if she hails from Africa. As others have said, including economists like John Bates Clark medal winner Daron Acemoglu from MIT, the opposition to Kim all seems like a strange defense of business as usual from people who have been critics of the Bank in the past.
Gregg Gonsalves is a long time AIDS activist and an Open Society Foundations Fellow.
Could Ngozi Okonjo-Iweala head the World Bank? (ungated) By Lant Pritchett, The Guardian
The candidacy of an African woman, Ngozi Okonjo-Iweala, to lead the World Bank represents a historic opportunity to strengthen the organisation in its mission to attack global poverty. However, the fatalist view is that Okonjo-Iweala cannot win because she is not American. Fortunately, in this case idealism and power politics can align. Okonjo-Iweala can and should win, but it will take effort. Here is a five-stage scenario of how events could play out.
My call for an open, inclusive World Bank (gated) by Jim Yong Kim, Financial Times
My own life and work have led me to believe that inclusive development – investing in human beings – is an economic and moral imperative. I was born in South Korea when it was still recovering from war, with unpaved roads and low levels of literacy. I have seen how integration with the global economy can transform a poor country into one of the most dynamic and prosperous economies in the world. I have seen how investment in infrastructure, schools and health clinics can change lives. And I recognise that economic growth is vital to generate resources for investment in health, education and public goods.
Every country must follow its own path to growth, but our collective mission must be to ensure that a new generation of low and middle-income countries enjoys sustainable economic growth that generates opportunities for all citizens.
U.S.’s World Bank Pick Defends His Credentials (gated) by Sudeep Reddy, Wall Street Journal
Dr. Kim is now on an international “listening tour,” meeting with officials in foreign nations. He has been widely praised by government officials and former colleagues for his experience in launching health programs and his on-the-ground understanding of poverty and development.
But he also has faced criticism from some economists, who say his development experience is too narrow.
New York University development economist William Easterly, a longtime World Bank foe, criticized Dr. Kim in a blog post Sunday for writing in a book 12 years ago that “the quest for growth in GDP and corporate profits has in fact worsened the lives of millions of women and men.”
Dr. Kim’s co-editors say the selected quote missed the overall point of the book, “Dying for Growth,” which is about identifying growth that helps the poor.
In recent days, Mr. Easterly, a staunch defender of free-market economics, has become a leading critic of Dr. Kim. He said in an interview that Dr. Kim’s “anti-globalization point of view” and critique of corporate-led growth put him at odds with the goals of World Bank members.
“All of the members of the World Bank want growth,” he said. “They want global corporations to come invest in their countries. … It’s just kind of odd that he would be now in a position to be a player in that system he’s expressed so much opposition to.”
Defenders of Dr. Kim note that the book, written in the late 1990s, came before heavy international investment in health and education to confront global health problems such as AIDS.
World Bank selection a ‘hypocrisy test’ (gated) by By Xan Rice, Lionel Barber and William Wallis, Financial Times
…[T]here has been a strong push from the emerging world for an open contest to choose a successor to succeed Robert Zoellick, which the main World Bank shareholders say they support. Ms Okonjo-Iweala, backed by African leaders, is one of three candidates vying to take over from Mr Zoellick when his tenure ends in July.
“I would really hold the Bretton Woods shareholders to their word, that they want to change the way business is being done and want a merit-based, open and transparent process for the presidency,” Ms Okonjo-Iweala told the Financial Times.
“I just want to see whether people just say things with their mouth that they don’t mean and what’s the level of hypocrisy,” she said in an interview. “So we want to test that.”
US World Bank nominee under fire over book By Robin Harding, Financial Times:
Jim Yong Kim, the US nominee to head the World Bank, is coming under fire over a book he co-authored that criticises "neoliberalism" and "corporate-led economic growth", arguing that in many cases they had made the middle classes and the poor in developing countries worse off.
Little is known about his views on economic policy because his background is in health. But if he cannot set out a strong vision for how the World Bank will fuel growth, it may boost the campaigns of heavyweight rivals such as Ngozi Okonjo-Iweala, the Nigerian finance minister and former World Bank managing director.
What should the World Bank be? By Jennifer Rubin, Washington Post
Rubin writes that the Kim nomination portends a shrinking role in global finance for the World Bank, which would become less a Bank and more a World Development Agency. She draws on Acemoglu and Robinson’s new book, Why Nations Fail to comment:
If you want societies to get out of poverty it’s not going to be billions in water reclamation projects that do the trick. Rather, you want “property rights, contract enforcement, ease of starting new companies, competitive markets, and freedom for citizens to enter the occupation and the industry of their choice.” Giving billions to despotic and corrupt regimes may actually set back progress.
See also: Isobel Coleman at the Council on Foreign Relations Jim Yong Kim and the World Bank’s Changing Role
Obama Has Made a Mess of the World Bank Succession By Clive Crook, Bloomberg:
At the top of the bank I expect that Kim would soon learn, if he hasn’t already, that market-driven economic growth is the only basis for lasting success against poverty and the disease and environmental degradation that go with it. Growth might not be a sufficient condition for social progress, but it’s certainly a necessary one (notwithstanding Cuba, where “Dying for Growth” finds much to admire). Nobody who questions this should be running the World Bank.
One of the other candidates in contention for the job is Ngozi Okonjo-Iweala. She’s a two-time minister of finance in Nigeria, where by all accounts she acquitted herself with distinction. She has also worked as a senior manager at the bank, so she knows what needs mending. You could argue she’s too much of an insider to be radical -- in advance, who knows? But on paper, at least, her qualifications are far better than Kim’s.
Obama Made the Wrong World Bank Call By Edward Luce, Financial Times
Dr Kim’s nomination was heavily influenced by Hillary Clinton, who rightly admires his grassroots work on Aids and other diseases. Of course it is critically important to fight them. But disease does not spread in a vacuum. Development is a complicated business. Yet healthcare is the prism through which Washington increasingly approaches it. Consider this: the US pledged $4.1bn for the latest replenishment of the International Development Association, the World Bank’s soft-loan arm for the poorest countries. It pledged almost exactly the same amount – $4bn – to the Global Fund to fight Aids, Tuberculosis and Malaria. Putting a healthcare specialist in charge of the World Bank would reinforce America’s focus on what some in the developing world dismiss as “the fashionable diseases”. It is the unfashionable illnesses, such as diarrhoea, that claim the most lives.
The right leader for the World Bank Editorial, Financial Times
This newspaper has acknowledged that, were Mr Kim to be selected, he could be a good choice. His background in health fits well with the Bank’s broader development goals, while his managerial record at the World Health Organisation shows that he could be effective at implementing these aims.
But the Bank needs more than this. Its new leader should have a command of macroeconomics, the respect of leaders of both the funding and the funded countries, and the management skills to implement his or her vision. These requirements make Ms Okonjo-Iweala the best person for the role.
My vision for World Bank – Okonjo-Iweala by Oscarline Onwuemenyi, Nigeria’s Vanguard
The Nigerian candidate herself says:
There are many emerging market countries that are very supportive of my candidacy and many of them feel that the World Bank is ready for someone who understands the challenges of emerging economies and of developing countries, and can totally focus on expanding opportunities for growth and development using practical financial tools to create growth.
The new US nominee for World Bank President, Jim Yong Kim, has some surprising opinions on the effects of economic growth. The BBC World Business Report interviewed both Bill Easterly and Abhijit Banerjee on the controversy. Listen to the 9-minute interview here:
The following quotations are taken from: Jim Yong Kim, Joyce V. Millen, Alec Irwin, and John Gershman, Editors, Dying for Growth: Global Inequality and the Health of the Poor, Common Courage Press: Monroe, Maine, 2000.
Introduction: What is Growing? Who is Dying? By Joyce V. Millen, Alec Irwin, and Jim Yong Kim
“This book seeks to fill an important gap in knowledge by examining the documentable health effects of economic development policies and strategies promoted by the governments of wealthy countries and by international agencies such as the World Bank, the International Monetary Fund (IMF), and the World Trade Organization.” (p. 6)
“The studies in this book present evidence that the quest for growth in GDP and corporate profits has in fact worsened the lives of millions of women and men.” (p.7)
“Even where neoliberal policy measures have succeeded in stimulating economic growth, growth’s benefits have not gone to those living in “dire poverty,” one-fourth of the world’s population.” (p. 7)
“Using Cuba as an example, Chapter Thirteen makes the case that when leaders prioritize social equity and the fundamental right of all citizens to health care, even economically strapped governments can achieve improved and more equitable health outcomes.” (p. 10)
Conclusion: Pessimism of the Intellect, Optimism of the Will, By Joyce V. Millen, Alec Irwin, and Jim Yong Kim
“Through a series of specific cases, we have demonstrated how growth – the market-led economic growth sought by governments, the growth in profits celebrated by businesses, and the growth in power and influence of transnational financial and corporate interests – often comes at the expense of the disenfranchised and vulnerable… As the imperatives of growth at any cost increasingly determine economic and social policy and the behavior of global corporations, more people join the ranks of the poor and greater numbers suffer and die.” (p. 363)
“Today, Chomsky notes, we see widespread ‘efforts to make people feel helpless, as if there is some kind of mysterious economic law that forces things to happen in a particular way, like the law of gravitation.’ Yet belief in such an immutable law is simply ‘nonsense.’ ‘These are all human institutions, they are subject to human will, and they can be eliminated like other tyrannical institutions have been.’” (p. 390, single quote marks note quotes from Chomsky)