Bush Banks on Stirring It Up With Wolfowitz Nomination

President Bush had an impressive list of candidates to choose from when he sat down with aides this month to pick a new nominee as president of the World Bank, the global antipoverty organization.

Among them were Carly Fiorina, the highly visible former chief executive of Hewlett-Packard, and Randall L. Tobias, former head of the pharmaceutical firm Eli Lilly and now the administration’s global AIDS coordinator.

Bush also could have warmed relations with allies by choosing one of any number of foreign finance ministers.

Instead, the president picked one of his most controversial aides -- Deputy Defense Secretary Paul D. Wolfowitz.

Coming a week after he chose conservative John R. Bolton as his ambassador to the United Nations, the move was widely seen as a major provocation of the same allies the president had been working to cultivate.

But the move offered important insights into Bush and his approach to his second term, showing a willingness to upset allies that made him unusual among recent U.S. presidents.

Bush’s choice of Wolfowitz and Bolton also highlighted his willingness to act on deeply held ideological beliefs.

In the case of the World Bank and U.N., Bush shares the view that the United States must assert U.S. leadership of major multinational institutions, U.S. officials and Republicans close to the administration said.

Bush contends these institutions need urgent reform to bring them more in line with the administration’s focus on fostering democracy and free-market economics in poor countries.

Bush’s choices also show that he believes the best way to ensure reform is by putting loyal aides in top jobs.

He is impervious to criticism from abroad, believing progress toward democracy in Iraq, the West Bank and elsewhere proves him right.

One U.S. official said last week that the Wolfowitz and Bolton nominations reflect the fact that “the president always picks people with long-term goals in mind.”

The administration’s interest in reforming the United Nations and the World Bank, he added, “have not been a secret.”

International reaction to the choice of Wolfowitz has been strong.

A committee of the European Parliament expressed “great concern” March 18 over Wolfowitz, a candidate described by Parliament member Luisa Morgantini of Italy, head of its development committee, as a leading advocate of “democracy by arms.”

Some European officials considered trying to block the choice, while a number of diplomats predicted the Wolfowitz selection would damage the fence-mending effort begun by Bush during his February trip to the continent.

But in Washington, some prominent Republicans said Bush’s efforts at reconciliation were misinterpreted by anyone who thought that the president would start deferring more to other countries.

“He wants the relationship on his terms,” said Newt Gingrich, the former House speaker who now advises the administration as a member of the Defense Advisory Board. “He wants the relationship while defending American interests.”

William Kristol, former chief of staff to Vice President Dan Quayle and editor of the conservative Weekly Standard, said the two appointments were part of a second-term pattern of moving loyal aides from the White House inner circle to high posts outside it to advance Bush’s key foreign policy goals.

The appointment of Bush public relations advisor and confidant Karen P. Hughes as chief of public diplomacy at the State Department was a striking example of the same strategy, he said.

“It’s a sort of tough-love diplomacy,” Kristol said. “He really has focused on how to make [organizations] work more effectively, work in harmony, obviously to advance our interests and our principles.”

Kristol acknowledged that Bush had been more willing than former Presidents Clinton and George H. W. Bush to make appointments that risked a strong negative reaction. In choosing Wolfowitz and Bolton, Bush is saying, “ ‘I got reelected -- I think my policies are beginning to work out -- and I want to advance them further,’ ” Kristol said.

Stewart Patrick, a former State Department official for the current administration, said the president’s moves reflected a traditional American ambivalence about international institutions. The ambivalence dates back to President Wilson and the League of Nations, an idea that he failed to sell to the country.

Americans have shown support for multinational institutions by initiating organizations like World Bank and the United Nations, yet officials of both parties became dissatisfied with the groups as soon as they seemed to veer from U.S. ideals, he said.

In their attitudes, these Bush administration figures reflect a “distinctive American internationalism” that involves a “forthright use of American power, and an unapologetic view that international institutions should reflect their values and principles,” said Patrick, now a research fellow with the Center for Global Development in Washington.

Both Clinton and George H.W. Bush “clearly had a more developed sense of the value of coalition consensus-building, and an awareness of the long-term costs of being seen as too coercive, or too unilateral, in your approach,” Patrick said.

Bush administration officials have grown eager to reform the World Bank and United Nations because they contend the institutions are not only inefficient, but also fall short of spreading the democratic and free-market values that they see as key to helping the world’s poor.

The bank, begun in 1945, has an impact on the economies of poor countries that makes it one of the world’s most influential institutions.

Dominated by the major industrial countries, the bank lends $18 billion to $20 billion a year. Its presence in a country encourages private lenders to offer additional project financing, and advice from its thousands of technical advisors is a major source of know-how in the developing world.

Although the bank originally focused on huge infrastructure projects -- roads, highways, ports and sewer systems -- it has diversified into so-called soft sectors such as education, healthcare and other social and environmental programs.

Although many governments clamor for the bank’s help, it also has come in for criticism. There has been debate about how much its efforts lift the poor from poverty, and how much its efforts simply enrich local elites. And many observers have charged that, largely in response to pressure from outside groups, it has spread itself too thin.

“It’s really a case of mission sprawl,” said Gary C. Hufbauer, a onetime deputy Treasury secretary and a senior fellow at the Institute for International Economics in Washington.

The administration has not been especially warm toward the World Bank for most of the first term, but neither has it been hostile, he said. One notable clash came when the administration pushed the bank to begin a program to help postwar Iraq, which it did after prodding.

Such signals are part of the reason that some allies in Europe and elsewhere fear the Wolfowitz appointment means the United States will try to redirect aid from sub-Saharan Africa to the Middle East, which is at the center of terrorism concerns.

But it has become increasingly clear that the administration has wanted reform. In one step toward greater accountability, it has pushed to replace World Bank loans with grants, on the theory that grant programs can be cut off more quickly if recipient governments don’t do their part to make projects work.

In comments since the announcement, Wolfowitz has sought to defuse criticism by insisting that he intends to build consensus, not impose U.S. goals. He has said that he knows his job is fighting poverty, not changing the politics of poor countries.

Yet he also acknowledged that the job would be about changing the ways countries are governed and trying to induce political improvements. Bush gave the same signal when he said Wolfowitz was well qualified for the job because of his “deep understanding of development, economics and political reform.”

The administration’s critique of the U.N. has been similar. Officials have complained often about inefficiency and waste, but they are also trying to steer the institution toward Bush’s short list of priorities.

The administration’s top official for U.N. reform, State Department official Patrick F. Kennedy, told the U.N. in January that U.S. goals included better financial management, emphasis on fighting terrorism and weapons proliferation, and “a universal commitment in the U.N. to promoting democracy and market-based economic systems.”

In the administration’s view, this job, too, will require shaking people up, said a senior House Republican aide.

“There’s a bit of the tough schoolmarm required in this kind of reform,” said the aide, who spoke on condition of anonymity. “It’s like the T-shirt -- ‘I hit my children because I care.’ ”