RANKINGS GONEWRONG
What’s more, though, the episode is a Hummer-hits-Corolla ding to the credibility of the entire multilateral organization community... from the Paris Climate Accords, to the World Trade Organization, to the World Economic Forum, and every other alphabet-soup group of international do- gooders... particularly those where the U.S. sits at the head of the table. If the World Bank couldn’t keep itself free from political influence (from China no less!), who can? If the World Bank couldn’t keep itself free from political influence (from China no less!), who can? It’s also a signal to China to accelerate its efforts to develop parallel rival groups – like its Asian Infrastructure Investment Bank, which aims to fund billions of dollars in projects throughout Asia every year... the $4 trillion (or so) Belt Road Initiative to build out infrastructure from East Asia to Europe... and the Shanghai Cooperation Organization (a Eurasia-focused economic, political, and security alliance spearheaded by China). China is reading the room, and it’s seeing that it’s not welcome.
She’s likely to follow the same ignominious path out the door as some of her predecessors. One former IMF head, Rodrigo Rato, was sentenced to four years in prison for embezzlement (at least not committed during his time at the IMF). Another, Frenchman Dominique Strauss-Kahn, quit in May 2011 amidst allegations that he sexually assaulted a hotel maid. A third, Christine Lagarde, was in December 2016 convicted of financial negligence from her time in the French government – but was not removed from her position. She went on to green-light the single worst lending decision in the decidedly mixed history of the IMF. And then – talk about failing upwards – in November 2019 she was made head of the European Central Bank, a position that rivals that of Jerome Powell, the head of the U.S. Federal Reserve, in global macroeconomic importance. Georgieva didn’t commit a crime... But she may have done something at least as bad: undercut the credibility of the multilateralism of the World Bank and, by association, other organizations operating in the same realm. And we’ll all suffer.
GEORGIEVA IS ON BORROWED TIME
The U.S. is the most important shareholder of the IMF, and it’s clear that Georgieva doesn’t have the support of the U.S. government.
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October 2021
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