Bush Picks Wolfowitz to Lead World Bank

President Bush nominated Deputy Defense Secretary Paul D. Wolfowitz, a leading administration neoconservative, as the new president of the World Bank on Wednesday, the second time this month Bush had moved to attempt to reshape an international institution.

Coming more than a week after he nominated State Department official John R. Bolton as U.N. ambassador, the choice of Wolfowitz was widely seen as part of a broader effort by Bush to bring key multinational institutions more in line with U.S. foreign policy goals.

Wolfowitz would replace James D. Wolfensohn, an Australian-born investment banker who is to step down June 1 after a pair of five-year terms. Wolfensohn, who was chosen by former President Clinton, could have served a third term, but the administration turned to Wolfowitz instead.

In announcing Wolfowitz as his choice at a White House news conference, Bush described him as a “skilled diplomat” and a “compassionate and decent man” who would be a “strong president” of the 184-country development institution.

Although the nomination drew praise in some foreign capitals and probably would be approved by the World Bank’s 24-member board, it also promised to be controversial.

Wolfowitz remains a lightning rod, especially in Europe, because of his early advocacy of the invasion of Iraq. Some foreign diplomats in Washington said they were concerned at the choice of the hawkish Wolfowitz right after the selection of the staunchly conservative Bolton, a longtime U.N. critic.

Wolfowitz said Wednesday that he believed deeply in the mission of the World Bank. But he also said he applauded moves in recent years by the outgoing Wolfensohn to step up the World Bank’s emphasis on accountability and reform of foreign governments “as critical elements of the economic development agenda.”

The Bush appointees’ views on both institutions appeal to neoconservatives. Neoconservatives believe the World Bank, as well as development aid in general, should be more closely keyed to governance reform and promotion of democracy, not just targeted to alleviate poverty while leaving authoritarian regimes in place.

Although Bush administration officials have not criticized the World Bank as strongly as Bolton has attacked the United Nations, the Bush administration has made clear its desire for a change in direction.

“These are significant multilateral institutions, and Bush is putting in people who obviously have thought that these institutions were not doing as well as they should have,” said Gary J. Schmitt, executive director of the neoconservative Project for the New American Century, a Washington think tank close to the administration. “The job here is not to tear these institutions down, but to make them work better.”

The Bush administration has been pushing for major reforms in how the World Bank operates, and is especially interested in having the development bank dole out aid in the form of grants, which don’t have to be repaid, rather than loans.

U.S. officials also have signaled they would like to see a replacement for the head of another key international institution: the International Atomic Energy Agency, based in Vienna, which monitors the proliferation of nuclear material and weaponry.

Some European diplomats were concerned that Wolfowitz might go too far in shifting the World Bank’s focus from sub-Saharan Africa to the Islamic world, in hopes that development there could help defuse anti-American militancy.

The Bush administration has made it a top second-term goal to spread democracy and economic reform through the Islamic world.

“We are concerned about seeing progress in Africa,” said one European diplomat, who spoke on condition of anonymity. The diplomat added that the World Bank’s board had great influence over the president’s course.

By tradition, the United States chooses the head of the World Bank, while Europeans choose the head of its sister agency, the International Monetary Fund. The institution said the members of its board had begun consulting officials in their capitals on the U.S. nomination.

The selection, if approved, will give a graceful exit from the U.S. government to a figure who was a pillar of the administration’s foreign policy but has been a target of criticism since the start of the Iraq war.

Wolfowitz, 61, who has worked in six administrations, was the first senior administration official to press for a confrontation with Iraq after the Sept. 11 terrorist attacks.

He is battered by antiwar Democrats whenever he appears before Congress. Democrats bring up Wolfowitz’s prediction that the war would largely pay for itself out of Iraq’s oil reserves, as well as his assertion that former Army Chief of Staff Gen. Eric K. Shinseki was wrong when he said the Iraq effort would require “several hundred thousand” soldiers. Many military analysts and some Defense Department officials have concluded that Shinseki was right and that too few U.S. troops were sent to Iraq.

The choice of Wolfowitz won public support from British and French officials. At home, however, some congressional Democrats criticized the choice.

House Minority Leader Nancy Pelosi (D-San Francisco) said the nomination was “hard to understand.”

“I don’t see much of a commitment to the vision of the World Bank,” she said.

The selection also was criticized by the top poverty advisor to U.N. Secretary-General Kofi Annan, who said Wolfowitz had little experience helping developing nations.

“It’s time for other candidates to come forward that have experience in development,” said the advisor, Jeffrey Sachs, director of the Earth Institute at Columbia University, in a speech to the U.N. Economic and Social Council.

Annan would not comment Wednesday.

Wolfowitz won praise from some congressional Democrats, including Sen. Joseph R. Biden Jr. (D-Del.), ranking member of the Senate Foreign Relations Committee, and liberal Sen. Patrick J. Leahy (D-Vt.).

Biden said he expected Wolfowitz would “campaign tirelessly to improve the welfare of people in need everywhere.”

Environmental groups, including Greenpeace and Friends of the Earth, denounced the selection. Greenpeace said it feared that Wolfowitz would “put U.S. and oil industry interests” ahead of efforts to improve the lot of the poor.

Wolfowitz, who is staunchly pro-Israel and said he was inspired to study Arabic language tapes by Egyptian President Anwar Sadat’s historic overture to Jews, said Wednesday that his service as ambassador to Indonesia in the 1980s convinced him of the value of global development, an experience reinforced by his tour of tsunami-stricken South Asia this year.

“Nothing is more gratifying than being able to help people in need,” he said.