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Paging Dr. Kim… Your World Bank Nomination is Ready
By Martin Denholm
“Non-white, non-WASP and not Larry Summers.”
Quoted in the Guardian, that’s how David Blanchflower, Professor of Economics at Dartmouth College, describes his boss, Dr. Jim Yong Kim – the man President Obama has just nominated for president of the World Bank.
I must admit, I chuckled at the last part of his statement. Summers, a former U.S. Treasury Secretary, Chief Economist at the World Bank and one of Obama’s top former economic advisors, was considered to be a leading candidate for the post.
I’m not sure why, given that he’s a pretty polarizing character. A man who rejected further regulation in the derivatives market and even once signed a non-serious memo that suggested developed countries should dump their toxic waste in third-world nations.
Needless to say, his potential nomination received an icy reception among the World Bank’s emerging nations. (A petition against his nomination last month also received almost 40,000 signatures in 24 hours, according to Dealbreaker.)
That’s important, because emerging markets are playing a more influential role in this race – a development that Obama recognizes with his nomination of Kim…
From Korea to the Cornfields
Born in Seoul, South Korea, 52-year old Kim moved to the United States when he was five and grew up in the American heartland of Iowa.
A licensed physician, he co-founded the Partners in Health program (which offers aid to the poor) while at Harvard University in 1987, and went on to run the World Health Organization’s HIV and AIDS division. And he’s currently the president of Dartmouth College.
Obama’s choice was a surprise, given that some big names were touted as candidates. In addition to Summers, Secretary of State, Hillary Clinton, had been mentioned, as well as United Nations Ambassador, Susan Rice.
But Kim doesn’t come completely from left-field. In 2006, Time Magazine named him among its “100 Most Influential People in the World.”
Surprising or not, there are strategic political aspects to the move…
The “World” Bank… But Only Americans Need Apply
Since the World Bank was founded in 1944, an American has held the position of president for the entire time. Similarly, the top job at the International Monetary Fund has traditionally gone to a European. It’s a cozy arrangement that the two continents share.
Needless to say, in this globalized world, calls are growing from emerging nations that the status quo and U.S.-European disregard of other nations should end. And that the World Bank Chief should finally be a non-American.
For example, Africa has united behind Nigerian Finance Minister, Ngozi Okonjo-Iweala, in hopes of a “merit-based, open and transparent” appointment.
With that in mind, Obama’s decision may go some way to appeasing:
“It’s time for a development professional to lead the world’s leading development agency. Jim has truly global experience. His personal story exemplifies the great diversity of our country… his experience makes him ideally suited to forge partnerships around the world.”
Kim also has the backing of a man who could have got the nomination himself…
Before the United States finally announced Kim as its official nominee, the leading candidate was Jeremy Sachs.
The Director of the Earth Institute at Columbia University and adviser to United Nations Secretary-General Ban-ki-Moon, Sachs entered the race with the support of Kenya, Malaysia, Jordan and East Timor.
But after Kim was announced, he withdrew his bid and graciously said, “Kim is a superb nominee. I support him 100%.” He was also in favor of the bank being run by a development expert.
In the end, despite the pressure from emerging nations, Kim is likely to get the job. The reason boils down to simple math and politics…
The United States holds the most casting votes in the ballot – 187. That’s about 16% of the total amount alone. In addition, European Union countries hold almost one-third of the votes – and with them likely to support the United States in that cozy World Bank-IMF arrangement I mentioned a moment ago, it’s all but a done deal. Especially when you factor in the likely votes for Kim from his birthplace in Asia, too.
So try as they might, it would seem to be very difficult for emerging markets in South America and Africa to break that stranglehold.
Question is, can Kim – who’s neither an economist, nor a banker – fulfill the job of “President of the World Bank?”
As Kim’s friend and Chair of Harvard University’s Department of Global Health, Paul Farmer, told the BBC:
“I can think of no one more able to help families, communities and nations break out of poverty, which is the stated goal of the World Bank. He’s worked in rural villages and squatter settlements just as he’s worked in the halls of power and privilege.”
I’d also venture to say that because Kim isn’t a stuffy, died-in-the-wool economist or banker, it might actually put him in pretty good shape right off the bat!
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