World Bank President: Wolfowitz issues memo 'to fill vacuum'. (Update 3)

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Wolfowitz issues memo 'to fill vacuum'. (Update 3) The World Bank president's office released late yesterday, aiming to highlight the sections most favourable to Wolfowitz. Quick as a flash World Bank staff have responded with a rebuttal.

3 updates below (comments from readers, FT analysis and Staff Association memo).

Wolfowitz circulated the favourable document extracts (available here) to all Bank staff at 7.26PM Washington time yesterday with a cover note: "Out of respect for the Board review process that has been underway, I have said little. I feel, however, that this has left a vacuum which has been largely filled by misleading information. The recently released documents, together, are quite lengthy; it's a lot to wade through looking for significant facts so I'd like to call your attention to a number of them".

Many Bank staff have already been perusing the documents very carefully. Within minutes of the president's memo the Bank's intranet was full of comments. Among them: "The latest note from the President and his little cover-up documents is too pathetic! Who advises him? Does he truly believe Bank staff are that simpl ... The latest note from the President and his little cover-up documents is too pathetic! Who advises him? Does he truly believe Bank staff are that simple? Besides, why didn't he submit all these documents to the Board? And there's nothing new in them...". I hear there's a more formal memo from Bank staff, too, which I'm trying to obtain**.

The Financial Times - the first to get some of the key memos in this affair - has also published it's own dismissal of the Wolfowitz extracts. It's major point: "the ethics committee talked about an ad hoc pay rise as an alternative to a promotion, not as an additional benefit". I.e. Riza should not have had both.

I think Wolfowitz may be getting a bit paranoid (though with some provocation). I don't see any vacuum that he needed to fill. There is plenty of commentary in all directions, and some of it clearly based on briefings by Wolfowitz or his people.

2 examples:

Fox News had a piece yesterday with spookily similar argumentation based on the 100 pages of internal bank documents. Their key point? That "the bank’s own ethics committee had known the terms of the settlement with Riza for at least a year". And, "while Wolfowitz did indeed dictate the lucrative terms of Riza’s salary to the bank’s human resources chief, he also took steps to try and determine if what he was doing was right – seemingly trying to navigate his way through an arcane bureaucracy with a maze of unusual rules and procedures". (Note this piece by Richard Behar follows a series of recent pieces by him for Fox News based on leaks from the World Bank board, or perhaps from the President's office).

The WSJ's on-line Opinion Journal has a piece arguing that Wolfowitz is being attacked by the "hide-bound bureaucracy". They say that they made a "private prediction" of this when he was appointed. This is bizarre: what's the point of working on WSJ print and on-line editorials if you keep your predictions to yourself?

www.worldbankpresident.org is working hard to prevent any vacuums in coverage of this important issue. Write to us at contact@worldbankpresident.org if you have insights or reactions to share.

UPDATE 1. Sunday 13.00 EST
A 'a World Bank retiree' writes in (thanks) to add his own punchy rebuttal.

"In his email of April 14, Wolfowitz draws our attention to his 'significant facts.' The 'significant facts' he omits are:

1) The Board was willing to accept his recusal but had to back down because apparently after subsequent advice from his attorney he had a change of heart and refused to recuse himself on "professional relationship" with his girlfriend. So his offer of recusal was a farce (and the Board saw it as such).
2) Contrary to his assertion that he was only looking after the interests of the Bank, the documents make it abundantly clear that he was only interested in safeguarding Riza's interests. It was he who devised the package (with Ms. Riza's help?) rather than HR.
3) Contrary to what he says, he was actively involved in devising the package for Riza, overruling the considerably less generous (and more reasonable) package proposed by HR. He cleverly directs Coll to give Riza an option between the two packages. One has to be stupid to elect to choose the vastly inferior package.
4) He was clearly both negotiating for Riza and turning around and acting like the 'decider'.

If this is not corruption, I don't know what is."

UPDATE 2. Sunday 13.20 EST.
Another correspondent, who wants to remain anonymous, has contributed the following cogent addition on both the link between Wolfowitz, Fox and the WSJ, and the rationale for the Riza pay increases.

"In your blog you speculated about Wolfowitz dictating some of the exculpatory editorials and Fox News documents. I firmly think that that's the case. Wolf has long had a cozy relationship with the Journal's editorial board, since at least 1998 during the Asian crisis when he had plenty of opinions. I recall they printed his early attack-iraq articles, too, before anyone else was talking about it. He's nothing if not a suckup. Not only has the journal given him two favorable editorials - the second one seemed to attack the IBD editorial focusing on his ethics, using its phraseology like 'pad her pay' in its rebuttal. They also gave Wolfo a soapbox late last week, probably thursday for his anticorruption program, that was exactly when he was trying to change the subject on his ethics. Nobody else did and nobody cares, because it's not newsworthy, but Paul needed some help with spin control so they obliged. The first WSJ editorial was clearly dictated by him, the journal did no actual reporting on the matter like the FT did and could not have known all those inside details they cited.

There is one interesting point to make about the two times the WSJ defended Riza - they kept saying she went over to the state department to a substantial job. Number one, it wasn't more substantial than Condi Rice's, that is for sure. But if it was so substantial, then why was it 'punishment' to her career that required an extra $60,000 compensation plus promised high-level no-competition promotions once Wolfowitz left? If it was such a terrible career-killer to be in the presence of the Bush inner circle on Iraq, why was she LITERALLY in bed with Paul Wolfowitz? She only got into this situation based on her own personal choices. If her career was that important, she could have recused herself from Wolfowitz, her domestic partner. But she seemed to think that she should be free to interact with her lover at the workplace with no one allowed to point to the obvious conflict of interest! What other employee gets to dictate the terms of her employment and if anything doesn't go according to her wishes, can say she's had her career ruined and her human rights violated? Riza seemed to think her job was her property and any assignment she didn't like was theft from her. She wanted to have it both ways, Paul and work and Paul at home. Plus the hefty salary increase. I think she's worse than he is. She sounds like she's got him blackmailed".

Thanks for this. Keep them coming. contact@worldbankpresident.org is the e-dress.

UPDATE 3. 15th April 15.45 EST.
Staff Association memo on this.

"Staff Association Update

April 15, 2007

President's Message to Staff of April 14th

Yesterday, Mr. Wolfowitz put out a message to staff drawing their attention to certain sections of the documents released by the Board on Friday, relating to their investigation of the terms of the external assignment in question. These same sections were made available to journalists covering the Spring Meetings in a web document entitled, " For the record - Direct quotes contained in documents released by the Board of Executive Directors, April 12. "

We recommend that staff consider all of the information made available by the Board of Directors and not just select passages. The highlighted sections, taken alone, do not present a full picture of the case and are, indeed, misleading. We could provide several examples of this, but leave staff to do their own due diligence and come to their own conclusions.

Alison Cave
Chair, Staff Association"

Alex Wilks ~ April 15, 2007

"Keep track of the rumored candidates, power plays and buzz."
The Washington Post

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