A President's Stumble at the World Bank
WHY YOU SHOULD CARE
Reforming the World Bank could help ease global poverty — if Kim’s overhaul succeeds.
By Steven Butler
Recently Jim Yong Kim strutted onstage at the Global Citizen Festival in New York’s Central Park — with his usual dark suit jacket draped over a T-shirt, atop blue jeans — explaining to the activist crowd what it means to be poor (no toilets) before chatting with Big Bird about teaching children how to use them. “What are you doing here?” Kim asked, with poorly feigned wonder. Wait, what are you — the president of the World Bank — doing here, with Sesame Street’s finest?
Kim’s just hamming it up, again. Check out his rap performance as a spaceman when he was Dartmouth College’s president. He’s also hobnobbed with Alibaba founder and e-commerce visionary Jack Ma as well as Indian Prime Minister Narendra Modi, not to mention Hillary Clinton, with whom he gabbed fluently, passionately, about the challenges of poverty and development, and even the difficulties of running his own bank. He smiles easily, often gesturing with his hand, while his high cheek bones, rimless glasses and thinning black hair (swept back) make him look slightly older than his 55 years. But, critics ask, is all this shoulder-rubbing with the rich and famous helping him run what might be the world’s most important development institution?
When Kim took over the World Bank in 2012, after being nominated by President Obama, no one disagreed that he needed to redefine its purpose for the 21st century. Founded at the end of World War II, the U.S.-dominated institution quickly shifted its focus from reconstruction to economic development, lending money to needy governments and providing advice. Yet after nearly 70 years, big clients like China and India had largely succeeded with development plans, and the private sector came to offer many of the financial services once available only from the World Bank. In 2013, Kim said a reorganization could make better use of the bank’s vast depth of professional experience, but he also announced plans to slash $400 million from the bank’s $5 billion budget. “For too long, the World Bank itself has not followed its own advice,” he said. “We are taking our own medicine.” (The World Bank didn’t respond to a request for comment.)
By the time Kim joined the World Bank, other development banks had sprouted up around the world, and his new mantra became eliminating severe poverty by 2030.
Kim, it seems, partly blames his staff, telling Clinton Global Initiative attendees last year — when his workers were in open revolt, and after he had listened to their recommendations for change — “a lot of people on the staff said, Wait a minute, we didn’t mean for you to actually change it.”
Born in South Korea, Kim arrived in Muscatine, Iowa, at the age of 5, the son of a periodontist father and a philosophy Ph.D.-holding mother. There, he proceeded to burnish credentials as the über-Midwesterner, graduating from his high school as valedictorian, class president, quarterback of the football team and varsity basketball player, although he left with a heightened sense of ethnic isolation. At Brown, he hung out with Black and Hispanic classmates and dumped an Irish-Catholic girlfriend, later heading back to South Korea to become “an authorized Third World person, so I could say shit,” he told author Tracy Kidder, in his best-seller Mountains Beyond Mountains.
The doctor and anthropologist — degrees he earned in an experimental program at Harvard — began his ascent to fame as a young man, essentially doing the back-office cleanup work for the visionary epidemiologist Paul Farmer at Partners in Health, according to Kidder. Then he took the lead on a revolutionary program to treat multi-disease-resistant tuberculosis in Lima, Peru, after which Kim decided he liked the policy and politics of it all. “I prefer it to taking care of patients,” he said. Thus began a brilliant career in public health that put him in charge of the World Health Organization’s AIDS program.
By the time Kim joined the World Bank, other development banks had sprouted up around the world, and his new mantra became eliminating severe poverty by 2030, and spreading the wealth elsewhere. He believed that could be helped by breaking down the bank’s powerful regional divisions and concentrating resources into functional areas like education or agriculture. “Dr. Kim arrived to great excitement,” says Paul Cadario, a former bank staffer who’s now a senior fellow at the University of Toronto’s Munk School of Global Affairs.
While the staff welcomed Kim’s apparent willingness to listen, the dialogue devolved into an endless gabfest before his drastic, but painfully slow-motion, reorganization was announced. Translation? Layoffs, a threat that still hangs over staff today, even as many senior staff have left, including prominent women. “He lost credibility by not producing a reform plan that could actually work,” says Lant Pritchett, a former bank employee who teaches at the Harvard Kennedy School. Indeed, a recent internal survey — posted online — found that only a third of staff said they had a clear understanding of the bank’s strategic direction, while less than 30 percent thought the bank had a culture of openness and trust.
For his part, Kim has said — during a rancorous staff meeting — that he’s “just as tired of the change process” as his employees. To his credit, he did win plaudits for the leadership he showed during the Ebola outbreak, where he grasped the issues and could spin his old Rolodex to get people moving quickly. The hope is he’ll redirect those skills to the bank’s grinding mission of helping poor countries out of their misery. It’s not impossible; he’s got two years left in office. And Kim recently announced that, for the first time, global extreme poverty had dipped below 10 percent, compared with 36 percent in 1990. “This is the best story in the world,” he said.
- Steven Butler, Steve landed at OZY after years of reporting all over the world and living for long stretches in Asia and Europe for the Financial Times and U.S. News & World Report. He has managed correspondents everywhere as foreign editor at Knight Ridder but is delighted to be free of the printing press. Follow Steven Butler on Twitter Follow Steven Butler on FacebookContact Steven Butler