The Wolfowitz non-story

Why the World Bank chief and his girlfriend are victims of scandal peddlers, not their own judgment.
By Ruth Wedgwood, RUTH WEDGWOOD is professor of international law and diplomacy at Johns Hopkins University's School for Advanced International Studies.
April 17, 2007


ON TAKING office, World Bank President Paul D. Wolfowitz set two priorities for the world's premier development institution. He asked for a focus on Africa's persistent poverty, and he targeted corruption that diverts aid dollars from the poor.

African leaders endorsed this vision, but not all bank bureaucrats were thrilled by Wolfowitz or his policies. Still, any friend of the bank's work should be dismayed by the disruption caused by a manufactured scandal at a time when the bank needs to replenish its coffers. The imbroglio rattling the World Bank during its spring meeting of finance ministers is a rehash of its clumsy attempt to resolve the status of Shaha Ali Riza, a veteran bank professional and Wolfowitz's longtime romantic partner.

The authors of this acrid affair have nakedly forgotten the standards of fairness and due process owed Riza, who is a member of the bank staff association and entitled to its fiduciary protections. And the scandal-mongers have recklessly ignored a written record of bank documents that serves not to condemn but to exculpate Wolfowitz.

Moreover, the case reveals the bank's executive board and its ethics committee as organs of haphazard judgment. In 2005, the ethics committee surprisingly denied Wolfowitz's written request that he be allowed to recuse himself from all decisions touching on Riza's status because of their relationship. Then it disqualified her from remaining at the bank yet insisted that she be compensated for this disruption to her career. Next, it insisted that Wolfowitz re-enter the chain of command to execute its advice concerning Riza. And now, board members apparently have criticized Wolfowitz for doing exactly what the ethics panel directed.

To be sure, news stories about Riza have revealed that the pay of World Bank staff far exceed what comparable professionals would earn elsewhere. The public may rightly be dismayed to learn that Riza and other World Bank "lead" professionals can earn from $132,000 to $232,000 — in some cases more than U.S. Cabinet secretaries. And because the bank is an international institution, staffers who are not U.S. citizens or permanent residents are not taxed by Washington. A foreign bank employee with a salary of $132,000 can support the same lifestyle as someone with a taxable gross income of more than $200,000. This should be changed.

But this does not excuse a mob mentality that abuses the reputation of a particular female professional, much less a bank president. The internal documents released last week — at Wolfowitz's request — show that this slow-moving institution had no protocol for figuring out how to accommodate the career of a professional woman when her spouse or partner came to work in the same chain of command. This is becoming a more serious problem in today's workplace.

Riza was a veteran of the bank, working as a senior communications officer in the Middle East/North African public outreach program before Wolfowitz was picked as bank president in 2005. With more than 15 years' experience in the field, able to speak Arabic, English and French, she was short-listed for a senior-level job. The bank's ethics committee in July 2005 gave "informal" advice that Riza had to give up her eligibility for promotion and leave the bank. It acknowledged that this step would disrupt Riza's career for a substantial period. For a 52-year-old bank employee facing mandatory retirement at age 62, losing a promotion and a long period of service is not trivial. The ethics committee thus reasonably concluded that Riza should receive some compensation for her forced transfer.

According to the documents on the bank's website, it was the ethics committee's own idea — not Wolfowitz's — to give Riza a promotion as she was being moved out for four years. She was transferred to the State Department to work on a grass-roots democracy project that has been praised by Secretary Condoleezza Rice. She was given the mid-range salary for her new level. This was a lot of money, but it was based on the bank's existing pay scales.

It was certainly not a corrupt favor to a girlfriend.

The most amazing thing is that all the facts were reviewed for a second time by the World Bank ethics committee last year, and again it found nothing wrong. The chairman of the ethics committee pronounced in a Feb. 28, 2006, letter that "the ethics committee decided that the allegations … do not appear to pose ethical issues." It is hard to square the record with the entertaining claim that the World Bank's president somehow concocted a do-nothing job for his girlfriend. It's a bum rap, and one that women professionals in dual-career families might worry about.