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White House Backs World Bank Head Paul Wolfowitz

The White House on Tuesday defended World Bank President Paul Wolfowitz as a special committee found that he broke the rules in dealing with a former employee, who was also his girlfriend. A proponent and an opponent of Wolfowitz's resignation debate the matter.

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    World Bank President Paul Wolfowitz headed to work this morning in anticipation of what could prove to be a fateful meeting with the bank's 24-member board of directors. The board has the power to dismiss or reprimand him or report a lack of confidence in his leadership.

    The meeting comes a day after a special bank panel reported that Wolfowitz broke bank rules in helping to arrange a substantial pay raise and promotion for his companion, Shaha Riza.

    In its report, the panel underscored that there is "a crisis in the leadership of the bank," and it urged the bank's board to decide whether Wolfowitz can, quote, "provide the leadership needed" to run the bank. The committee said Wolfowitz "placed himself in a conflict of interest situation" and "should have withdrawn from any decision-making."

    In 2005, as Wolfowitz joined the World Bank, he became involved in negotiations to have Riza re-assigned from the bank to the State Department, with a salary totaling almost $200,000 year. Wolfowitz has said he relied on advice in the matter from the bank's ethics committee. He has claimed that the ethics committee insisted that Riza leave the bank upon his arrival.

  • PAUL WOLFOWITZ, World Bank President:

    I didn't volunteer to get involved in this. I didn't get involved for any personal reasons, but rather to resolve something that I think posed institutional risk. I didn't hide anything that I did. And I'm, as I said, prepared to accept any remedies that the board wants to propose.


    The board acknowledged in its report that the ethics committee advice, quote, "was not a model of clarity," but said Wolfowitz's interpretation "turns logic on its head." Since details of the matter emerged last month, Wolfowitz has apologized.


    I made a mistake for which I am sorry. But let me also ask you for some understanding. Not only was this a painful personal dilemma, but I had to deal with it when I was new to this institution, and I was trying to navigate in uncharted waters.


    But that has done little to quell calls for his resignation from the World Bank's staff association and the Bank's European members.

    The 185-nation institution focuses on lending money to developing countries. In return, those countries are supposed to improve their economies and limit corruption.

    The U.S., as the bank's largest lender, gets to choose its president with board approval. Since his nomination two years ago, Wolfowitz has been criticized for his prior role as a key architect of the Iraq war.

    GEORGE W. BUSH, President of the United States: He ought to stay. He ought to be given a fair hearing.


    President Bush and members of his administration have repeatedly backed Wolfowitz, saying they don't think the facts merit his dismissal. Today, White House spokesman Tony Snow said they still supported Wolfowitz, but added…

  • TONY SNOW, White House Press Secretary:

    Members of the board, Mr. Wolfowitz, need to sit down and figure out what is, in fact, going to be best for this bank to be able to serve as a venue for — especially in the developing world. Regardless, we have faith in Paul Wolfowitz. We do think it is appropriate for everybody to sit down after the fact, calm down, take a look, and figure out, "OK, how do you move forward?"

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