Wolfowitz: Will He Stay or Will He Go? President Bush says he supports embattled World Bank President Paul Wolfowitz. But will Wolfowitz weather criticism of the way he has handled his girlfriend's employment at the bank? And if he does leave, who might replace him?
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Wolfowitz: Will He Stay or Will He Go?

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Wolfowitz: Will He Stay or Will He Go?

Wolfowitz: Will He Stay or Will He Go?

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RENEE MONTAGNE, host:

It's MORNING EDITION from NPR News. Good morning. I'm Renee Montagne.

STEVE INSKEEP, host:

And I'm Steve Inskeep.

President Bush is standing by the leader of the World Bank, though some former officials are not. Paul Wolfowitz is under attack for many reasons, one of which is the raises that he approved for his girlfriend. And this week, the Financial Times newspaper printed a letter from former World Bank staff that reads, we believe he can no longer be an effective leader. He has lost the trust and respect of bank staff at all levels. This letter goes on to say that Wolfowitz's damaged credibility on his flagship issue - fighting corruption.

David Wessel of The Wall Street Journal is following this story.

David, good morning once again.

Mr. DAVID WESSEL (Deputy Washington Bureau Chief, The Wall Street Journal): Good morning.

INSKEEP: Who can fire Paul Wolfowitz, if any one?

Mr. WESSEL: Well, the World Bank has a board of directors. It's owned by the countries of the world. They have delegated to 24 people on the executive board, the power to hire and fire a president. If they wanted him out, he could be out this afternoon.

INSKEEP: So what signals are you seeing from the board so far?

Mr. WESSEL: Well, the board is clearly divided. They haven't endorsed him and they haven't fired him. We know that a number of European governments are quite hostile to Mr. Wolfowitz. They were hostile when he arrived, and they haven't liked him any better. We know that the U.S. is standing behind him. It looks like some African countries are endorsing him and holding onto him.

So at the moment, they're in this great investigatory mode. We have to keep looking into this and we should move quickly but they haven't come to conclusion yet.

INSKEEP: Which means, presumably, that the president of World Bank, however much he would like not to be, is going to be distracted by this. How important is the institution that he leads and the work that he's involved in?

Mr. WESSEL: Well, I think pretty darn important. I mean, the World Bank was born after World War II to basically rebuild Europe and it has taken on the mission now of fighting poverty, fighting AIDS, helping educate people in countries where there is basically very little education. It's an incredibly important function. They have $100 billion worth of loans outstanding. They make $14-15 billion worth of loans every year. This must be an enormous distraction.

INSKEEP: And where did Paul Wolfowitz's anti-corruption campaign fit in? The campaign that, in a sense, got him in trouble because of the way that he conducted it.

Mr. WESSEL: The World bank became increasingly worried about corruption and how it interfered with its poverty-fighting mission under the leadership of its past president. Mr. Wolfowitz continued it and he did it in a somewhat politically insensitive way, it turns out. He was making a very strong push on this, I think, he's compromise his ability to lead that effort now that everybody in the world knows or the people who pay attention to this stuff anyways, that he is accused of the very corruption that governments are criticized for.

INSKEEP: Well, if he were to leave, and we have no indication that he will, but if he were to leave, who would choose a successor?

Mr. WESSEL: Well, technically, the board hires his successor. The tradition for the last 60 years has been that an American leads the World Bank and a European leads the International Monetary Fund. There are an awful lot of people in the world who think this is an outmoded custom and that the World Bank ought to find the best leader no matter what his or her nationality. I'm sure that if Mr. Wolfowitz goes, that issue will arise again. There's already talk about what foreigners might do the job better than an American but there's no sign that the U.S. is willing to give up its grasp.

INSKEEP: And just so I understand, if President Bush were to call up the president of the World Bank, Paul Wolfowitz or whoever it might be and say I really think you should resign, would that heave any force?

INSKEEP: I'm sure it would have a great deal of force. I think there are lot of people who are betting that in the end, Mr. Wolfowitz will resign on his own volition. If the U.S. decided it was time for him to go and sided with the Europeans who seem to be pushing him for him to go, he would pretty much be out of there.

INSKEEP: is there a scenario by which Paul Wolfowitz would keep his job?

Mr. WESSEL: Oh yes, I think so. Clearly, Mr. Wolfowitz is in trouble with his staff and part of the issue is a couple of his lieutenants, not his girlfriend, but a couple of other lieutenants who have become very controversial. I can imagine a scenario where he agrees that they will leave, that he may be take some kind of formal scolding from the board and agrees to a change in the way the bank is governed and keeps his job. I think there are probably some governments that would prefer a weakened president in that job that they could push around to a very strong credible one, and some of those people may actually help him keep his job.

INSKEEP: David Wessel of The Wall Street Journal. Thanks very much.

Mr. WESSEL: A pleasure.

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