Paul Wolfowitz, former US Deputy Secretary of Defence and one of the most influential neoconservatives of the Bush administration and a key architect of the Iraq war, has been forced to resign in disgrace from his current post as President of the World Bank. Technically, his resignation comes because of ‘ethical lapses’ concerning favouritism and financial benefits to his girlfriend, Shaha Ali Riza. In reality, this is not just the story of a bad manager who was reviled by his staff and became a pariah in his own institution. This is also the story of an institution that plays with the destiny of hundreds of millions of people around the world but remains unsure of and unable to shape its own identity.

The presidency of the World Bank offered Wolfowitz an opportunity to test out his grand theories about shaping the ‘hearts and minds’ of populations in developing countries who were becoming increasingly distrustful of US foreign policy goals. It also allowed President Bush a chance to install the most hawkish of his hawks at the helm of the one international institution that can intrude deeply into national economic, social and knowledge institutions that do, in fact, have the capability to shape the ‘hearts and minds’ of people around the world.

It would be a pity if the Wolfowitz affair pushes the World Bank even deeper into the abyss of institutional angst. It would be equally sad if the opportunity for serious reform at the

World Bank that is afforded by this turn of events were to be missed.

The World Bank has failed to resolve its own identity crisis: Is it a ‘bank’ or a ‘development institution’? It likes to call itself not just ‘a’ bank, but ‘the’ Bank; but it is not. Its employees are encouraged to act as if they were bankers; but they are not. Many do not even want to be. The result is that it ends up being neither. It fails to apply either the fiscal rigour of a real bank or the deep compassion of a real development institution.

What should happen immediately is to change the process for selecting World Bank presidents. Traditionally, the president is an American and is chosen by the US government. Maybe it is time to change this tradition.

As the Wolfowitz case has shown, this job is too important to be a partisan political appointment from one country. The fact that the US is the single largest shareholder should never have been the criterion. If it is to be, then the EU now holds more votes and should have precedence. But if we have to rethink the process, then why not think broader?

Are individuals coming from the richest industrialised nations automatically more capable of understanding and implementing the World Bank’s stated mission of ‘global poverty reduction’? Couldn’t someone who comes from a developing country and who has seen poverty and its determinants closer at hand do the job as well?

The US has been quick to lay claim to the next appointment. Others have suggested European alternatives, including UK PM Tony Blair. Developing countries should also throw a few names into the ring. At the very least it will get a conversation going on imagining the possibility of putting the ‘world’ back into the World Bank. Later, we can also start thinking about taking the ‘bank’ out of it.

Prof. Najam teaches at The Fletcher School of Law and Diplomacy, Tufts University, USA