STEVE INSKEEP, host:
The president of World Bank, Paul Wolfowitz, got a chance to defend himself yesterday. It was a chance to address charges that he broke the rules by arranging a raise for his girlfriend.
Wolfowitz hit back hard. He appeared before a bank committee and he said his critics had launched a smear campaign. Wolfowitz says he will not resign over, quote, "a plainly bogus charge of conflict of interest."
NPR's Tom Gjelten reports.
TOM GJELTEN: For weeks now, Paul Wolfowitz has heard that the alleged sweetheart deal that he arranged for his companion and colleague Shaha Riza had made a mockery of his international campaign against cronyism and corruption. He's already said he regretted his involvement in the negotiations over her pay and promotion, but in an appearance yesterday before the World Bank committee that's investigating him, Wolfowitz said it would be unjust and frankly hypocritical of the board to conclude that his actions were improper.
Wolfowitz was accompanied by two lawyers and came prepared with a detailed legal brief, insistent that he arranged the pay raise and promotion for Shaha Riza only at the instruction of the Ethics Committee of the bank board, that he followed bank rules at every step, and that he believed the Ethics Committee knew about the arrangement and had no problem with it.
He suggested that his critics inside the bank had aimed to create a self-fulfilling prophecy that he is an ineffective leader and must step down for that reason alone, even, he said, if the ethics charges are unwarranted. I for one, he said, will not give in to such tactics.
A large segment of the World Bank staff is demanding that Wolfowitz resign. Those who want him to go have taken to wearing blue ribbons as a sign of protest, and bank officials report that the ribbons are now seen everywhere in the bank buildings. Some bank staff say they have turned against Wolfowitz because of what they see as his arrogant attitude and his authoritarian management style. But Wolfowitz still has one very important backer, President Bush.
President GEORGE W. BUSH: My position is that he ought to stay. He ought to be given a fair hearing. And I appreciate the fact that he has advanced - he's helped the World Bank recognize that eradication of world poverty is an important priority for the bank.
GJELTEN: Bush was speaking at a press conference yesterday with German Chancellor Angela Merkel, whose government has hinted strongly that Wolfowitz should go. Speaking through an interpreter, Merkel stopped well short of endorsing Wolfowitz, referring instead to the board's investigation of his conduct.
Chancellor ANGELA MERKEL (Germany):(Through Translator) And my position is, and this is going to be relayed by a minister in the board - in the individual bodies of the World Bank and their respective commissions as well, that this ought to be a very transparent, very candid conversation...
GJELTEN: For all his defiance yesterday, Paul Wolfowitz did leave the door open to resigning once the allegations against him are dropped. Only then, he said, will it be truly possible to determine objectively whether I can be an effective leader of the World Bank.
But any deal could take several days to negotiate, and in the meantime, the standoff seems likely to continue. Wolfowitz shows no sign of giving in and sources say the bank executive board is in no hurry to force a vote on whether he should go.
Tom Gjelten, NPR News, Washington.
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