Maria Andersen / Uncategorized

Sachs vs. Easterly: On Running the World Bank (Maria Andersen)

Flickr Creative Commons // Crossroads Foundation Photos

This morning, Steve Mufson of The Washington Post wrote:

Some things are question of etiquette: How to hold your fork….Not to touch the Queen of England until she extends her hand. One of the things just aren’t done is to campaign openly for the presidency of the World Bank.

A little over a week ago, in a Post op-ed, Jeffrey Sachs outlined how he would lead the World Bank:

My quest to help end poverty has taken me to more than 125 countries, from mega-city capitals to mountaintop villages, from rain forest settlements to nomadic desert camps. Now I hope it will take me to 18th and Pennsylvania, to the presidency of the World Bank. I am eager for this challenge.

Sachs’ action was surprising to many. The World Bank has been hosting tryouts for a new president since early February and all 187 member countries are invited to participate; thus far, Americans have been dominating the field. Perhaps most astonishing is Sachs’ eagerness. It’s custom that WB presidential potentials are nominated for the process — Sachs’ act of essentially requesting a nomination is unusual. Sachs has expressed that a large part of his decision to, er “campaign,” was based off of his opinion that the Bank should be run by someone who understands development, rather than just another politician:

Unlike previous World Bank presidents, I don’t come from Wall Street or U.S. politics. I am a practitioner of economic development, a scholar and a writer. My track record is to side with the poor and hungry, not with a corporate balance sheet or a government.

(Ah, there’s that whiff of compassion, ambition and sense of urgency that wafts from any Sachsian oped!)

Is Sachs right? Do his experiences make him the man for the job? He certainly sounds both earnest and sincere. This “celebrity economist” knows how to charm his fan base audience. And let’s not forget, he did write an entire book on how to end poverty — the question that WB staffers have been grappling with for decades. His experiences as the Director of the Earth Institute, special advisor to Ban Ki Moon, father of the Millennium Development Goals; his years as Harvard Professor and as economic adviser to governments in Latin America and Eastern Europe, no doubt all exemplify a solid background in development. Perhaps it’s not unprecedented that he joins the ranks of other nominees?

Just as we feel ourselves falling under Sachs’ spell, along comes William Easterly to clear the air.

Like Sachs, Easterly is a renowned professor in economic development. Unlike Sachs, Easterly has zero desire in becoming the next WB President. Easterly makes a public case for why he shouldn’t get nominated at all. In response to Sachs, Easterly published a witty piece in Foreign Policy on how he would not lead the World Bank:

I am gratified by the widespread support that my non-nomination for World Bank president has received. My quest to help end poverty has led me to the ends of the Earth. My accomplishments speak for themselves, having successfully offended every official or interest group in any way connected to the World Bank, even the head of maintenance.

This wouldn’t be the first time Easterly pokes fun at Sachs and the Bank. Certainly, Easterly deserves credit for his sense of humor, but I think there’s more to the piece than comic relief. Easterly’s article gives us some healthy perspective. Reading in between the witty lines, a few important questions come to mind:

1) What exactly is (should be?) the role of the WB President? Why would does it matter so much who runs the Bank?

Lawrence MacDonald of the Center for Global Development, shared Nancy Birdsall’s thoughts explaining,“The tone the president sets matters for the great machinery underneath. They determine in what direction it will grind along, and if it will do so in a way that makes sense. Will there be openness to a new direction and a readiness to admit problems and failures? All that is set at the level of the president.”

2) Is the extent of power and control held by the WB President exaggerated? Is the role of the Bank itself overrated? Easterly’s FP piece certainly treats Sachs’ proposition as a joke, but is Easterly laughing specifically at Sachs? Or at the process in general?

There’s quite a bit of debate on the extent to which international institutions (like the WB and IMF) should be involved in development. Whether one agrees or disagrees with how effective the Bank is in its mission, the bottom line is this: at this point in time, the WB is world renowned for being the leading institution actively involved in promoting development. It is respected (and taken seriously) by many governments and it interacts with big players in the global economy. Systematically speaking, political interests are intricately intertwined in the Bank’s web of operations. A number of active decisions in development are left to the discretion of the Bank and its member countries. I do agree with Sachs on one point — the ideal President should understand development and be capable of leading the institution’s initiatives responsibly.

In regards to Sachs’ competence, Mufson featured a classic (e.g., dead-on and witty) comment from Easterly in today’s Post article:

William Easterly [once wrote] that Sachs’ “ideas on Africa happen to be sometimes totally wrong, and other times only seriously wrong.”

As with all satires, there’s an important point to be made and I understand Easterly’s to be this: economic development is about helping the poor, and you can contribute to this effort regardless of your professional association with the Bank. Easterly, an ex-staffer himself, reminds us that he alienated the Bank years ago; his career in development has clearly not suffered since his exit. Sachs places the WB and its Presidential position on a pedestal, but Easterly keeps us grounded. You don’t need a fancy World Bank title in order to be influential in development.

In the meantime, there’s no need to worry just yet. The Wall Street Journal commented yesterday evening on the unlikelihood of the Obama administration nominating Sachs.

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