With September 11 still resonating, you’d think the world’s rich countries would at least agree that the very poorest need help. No such luck. According to the Financial Times, the US and European countries are deadlocked over contributions to the World Bank’s International Development Association, the source for so-called soft money loans to the poorest nations.
The World Bank is seeking $12.5 billion in new contributions over the next three years. The US is apparently willing to up its contribution provided increases in the second and third year are contingent on hitting certain performance targets. The UK is also ready to increase its contribution provided the US drops its plan for a switch from loans to grants. France, Germany and Japan, in the meantime, are looking to cut their contributions, citing domestic budgetary pressures.
As the FT’s analysis points out, the standstill comes when international rhetoric has called for increased aid, in light of the global economic slowdown.
Dave Winer asks whether I’ll be blogging Davos in New York. I suspect he didn’t really need to ask. It’s more of a call to arms. And of course I’ll respond with I hope yeoman service over the five days in New York. Watch this space.
Paul Krugman has a different take on the Enron affair. He’s equivocal on whether there was political wrongdoing, but believes it exposes the extent of crony capitalism in the US. I agree with Paul, but I wonder whether anyone really doubted the extent of big business’s reach into the US political process, and the current administration in particular.
The World Bank has a horrible record at dealing with poverty. I strongly disagree with the anti-globalization folks, but they are dead on about the World Bank and IMF who are often part of the problem rather than the solution.