Wolfowitz On His Way Out At World Bank

Embattled President Will Resign At End Of June

(CBS/AP)  World Bank President Paul Wolfowitz will resign at the end of June, he and the bank said late Thursday, ending his long fight to survive pressure for his ouster over the generous compensation he arranged for his girlfriend.

Wolfowitz agreed to resign, effective June 30, after the bank's executive directors issued a statement saying they accept his assurances that he "acted ethically and in good faith" when he arranged a promotion and pay raise for his girlfriend, reports CBS News radio correspondent Bill Whitney.

His departure ends a two-year run at the development bank that was marked by controversy from the start, given his previous role as a major architect of the Iraq war when he served as the No. 2 official at the Pentagon.

Wolfowitz was all but forced out, however, by the finding of a special bank panel that he violated conflict-of-interest rules in his handling of the 2005 pay package of bank employee Shaha Riza.

The controversy, which gripped the bank for a month, was seen as a growing liability that threatened to tarnish the poverty-fighting institution's reputation and hobble its ability to persuade countries around the world to contribute billions of dollars to provide financial assistance to poor nations.

By tradition, the World Bank has been run by an American. The Bush administration keenly wanted to keep that decades-old practice firmly intact as the board dealt with Wolfowitz's fate. The United States is the bank's largest shareholder and its biggest financial contributor.

The White House said it would have a new candidate to announce soon, allowing for an orderly transition.

Earlier Thursday, President Bush had seemed resigned to the likelihood that Wolfowitz would lose his job over the conflict-of-interest charges. "I regret that it's come to this," Bush said.

In its statement, the bank's board said it was clear that a number of people had erred in reviewing Riza's pay package.

Wolfowitz, who had fought the pressure to resign for weeks, had sought a recognition from the bank that he did not bear sole responsibility for the matter. In his own statement Thursday, Wolfowitz said he was pleased that the board "accepted my assurance that I acted ethically and in good faith in what I believed were the best interests of the institution, including protecting the rights of a valued staff member."

Now, he said, it was in the best interest of the board that its mission "be carried forward under new leadership."

The board's statement made no mention of any financial arrangements related to Wolfowitz's departure, nor did it address Riza's future.

As a result of the controversy, the board pledged to review the World Bank's ethics policies, noting that "the bank's systems did not prove robust to the strain under which they were placed."

Wolfowitz waged a vigorous battle to save his job and maintained he had acted in good faith.

European nations had led the charge for Wolfowitz to resign. Those calls were backed by many on the bank's staff, former bank officials, aid groups and some Democratic politicians.

Until near the end, the Bush administration had professed support for Wolfowitz. But in a shift on Tuesday, the White House indicated for the first time it was open to his departure. It was the same day Wolfowitz made a last-ditch plea to save his job before the board.

Among those mentioned as a possible replacement for Wolfowitz are former Deputy Secretary of State Robert Zoellick, who was Bush's former trade chief; Robert Kimmitt, the No. 2 at the Treasury Department; Treasury Secretary Henry Paulson; former Republican Congressman Jim Leach and Sen. Richard Lugar, R-Ind.; and Stanley Fischer, who once worked at the International Monetary Fund and is now with the Bank of Israel.

Riza worked for the bank before Wolfowitz took over as president in June 2005. She was moved to the State Department to avoid a conflict of interest but stayed on the bank's payroll. Her salary went from close to $133,000 to $180,000. With subsequent raises, it eventually rose to $193,590. The panel concluded that the salary increase Riza received "at Mr. Wolfowitz's direction was in excess of the range" allowed under bank rules.

Wolfowitz "placed himself in a conflict of interest situation" when he became involved in the terms and details of Riza's assignment and pay package and "he should have withdrawn from any decision-making in the matter," the panel said. Under Wolfowitz's contract as well as the code of conduct for board officials, he was required to avoid any conflict of interest, the report said.

The panel acknowledged that the informal advice Wolfowitz received from the bank's ethics committee "was not a model of clarity."

Still, the entire episode involving Wolfowitz's handling of the pay package "underscores that there is a crisis in the leadership of the bank," the panel said.

Before taking over the bank nearly two years ago, Wolfowitz was the No. 2 official at the Pentagon and played a lead role in mapping the U.S.-led war in Iraq.

Bush tapped Wolfowitz for the job, a move that was approved by the bank's board even though Europeans didn't like him because of his role in the Iraq war.

The 185-nation World Bank, created in 1945 to rebuild Europe after World War II, provides more than $20 billion a year for projects such as building dams and roads, bolstering education and fighting disease. The bank's centerpiece program offers interest-free loans to the poorest countries.

[grazinggoat]

I've got 10 bucks that says Wolfowitz ended up eating whatever it is that he is extracting from his ear in the photo!
Posted by FeelFree1 at 01:25 AM : May 18, 2007

-Full of nutrient brown sugar... lol.

[victoriarum]

In the real work world if a person dispels themselves they are escorted out the door. Managements own behavior is questionable and is understandable, and why there would be so many questions of their own agenda.

When is "Ethics" going to be placed back into this country, our thinking, our society?

When is the "double standards" going to be removed from policies?

Please show some respect by only replying to me intelligently, as I only want Peace in this world, as much as you do.

God Bless.

[rhs648]

How embarrassing that people entrusted with the well-being of the public have the arrogance to put themselves above the law. These people reject the idea that the rules pertain to themselves. Sadly, this can be seen on the local level, the state level, and the federal level irrespective of the political parties to which they belong. This can even be observed with homeowner associations and is endemic in the corporate world as well. Is there any hope?

[aaabee-2009]

It seems Republicans these days place far more worth on the quality of their excuses than on the quality of their character.

Wolfowitz is just the last in a long line of moral examples set by the conservative side of the house, with no rebuttal by any of our religious leaders on what their public representatives are representing to the public these days.

[pepperp1]

WHATEVER,,,,even though %u201C%u2026he was known for his passionate advocacy of Israel%u2026%u201D he is gone, and attacking him is not attacking Israel. Libby is schedule for sentencing bye bye and former CIA officer Valerie Plame is after the rest of this crowd.

[rhs648]

"What an incredible claim! You're saying that 'being a Jew' somehow makes you more qualified to define the word 'fascist'. You were no more effected by any fascist element than I was, and I am Irish. You're right though, being a Jew does qualify you for certain tasks... jewlery merchant, or clothing salesman."

Posted by im4honesty

The only honesty you represent is expousing distasteful sterotypes. Insensitive remarks like these expose you for what you are.

[rhs648]

"Oh and out of curiosity, what has being Irish got to do with fascism? Ireland were "neutral" in the 2nd world war, censured their own press under emergency powers and refused to show partiality to either side."

Posted by Stezzer

In other words, Ireland let other countries do the dirty work. Is this something to be proud of?

[pepperp1]

He admires is code for that I need to skate in the book, what proof do you need that this President does not have the best interest of the American People. Mr. the Iraq oil we pay for the war, Mr. President that%u2019s a 700 Trillion dollar mistake this bozo made and you put him at the World Bank. LOL!

[starleo146]

there is a song from long ago that fits Bush and his administration "Oh what a lovely bunch of coconuts"

[clestes-2009]

And Bush says he admires this sleaze ball. What is there to admire, I ask??

He was a big part of the Iraq invasion plan, which has proven to be a disaster. That shows he is a liar and can't put together a plan for a lunch picnic, let alone invading another country.

He was the first to jumped the faltering Bush ship. Loyalty to Bush after he pushed Bush relentlessly to invade and it proved to be wrong?? Fat chance!!!!

He refuses to give money for food to any country that is not a democracy. Most of the children who need food do not live in a democracy. So, just let them starve. Show no compassion and a blind adherence to his ideas no matter who suffers.

He wrangles a new job with a bunch of money for his girlfriend, which she is not qualified for and does not deserve. That shows real integrity!! She probably would not sleep with him if he hadn't.

All in all a man to be admired! Certainly the type of person our president aspires to be like!!

It is enough to make me sick.

[micma-2009]

Good ridence to more bad neocon rubish.

[irishmail42]

Will Alberto be the next to go? Why are the American people so willing to accept all the Bush Administration incompetence?

[bareemperor]

The well-worn pattern of all Bu$h appointees is playing out...

Kiss-@ss traitors, poorly placed in positions of power due to their loyalty to the king.

Failure and criminal activities are rewarded and stonewalled by Bu$hCo, anyone not supporting the appointee is demonized.

In the end, truth prevails, and the appointee is abandoned and forgotten by those who used the idiots.

[afmca]

Bush's theme .. Another bites the dust .. Another bites the dust .. and another one .. and another one .. and another one bites the dust. Gonzo your next!

[stezzer]

im4honesty

Thanks for your racist comment. However, you should have read my previous post and made an effort to understand the ongoing difference of opinion.

Instead you chose to post ignorant swill.

Oh and out of curiosity, what has being Irish got to do with fascism? Ireland were "neutral" in the 2nd world war, censured their own press under emergency powers and refused to show partiality to either side.

[starleo146]

To think they stoned that poor 17 year old girl to death for loving a boy of a different faith and these two milked this country at every level of any integrety we once had but we are looked at so much with hate around the world and we use to be the most respected there should be some punishment this guy could be our next atty general. Imagine he would not resign till all imprprioties are removed from his resume. DISGUSTING

[missingamerica]

I heard they're going to make Gonzo World Bank President and move Wolfie over to Attorney General.

[bluestardad]

HAND CUFF THIS TROLL AND TRY HIM FOR WAR CRIMES! HE HAS BLOOD ON HIS HANDS OF THOUSANDS OF LIVES!

[iceman_1960]

"Is Wolfie an Israeli or an American?"
- Posted by karlimhof at 08:07 AM : May 18, 2007

Neither. He was born in Brooklyn. [just kidding]

He followed his father to Cornell University.

"At Cornell Mr. Wolfowitz majored in mathematics and chemistry, but he was profoundly moved by John Hersey's book 'Hiroshima' and shifted his focus toward politics. 'One of the things that ultimately led me to leave mathematics and go into political science was thinking I could prevent nuclear war,' he said." - Wikipedia

Well, there hasn't been a nuclear war, has there ?

Lets give Wolfie some credit.

[iceman_1960]

"I've got 10 bucks that says Wolfowitz ended up eating whatever it is that he is extracting from his ear in the photo!"
- Posted by FeelFree1 at 01:25 AM : May 18, 2007

Actually he was preparing to wax eloquent about his girlfriend.