The World's Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations (Council on Foreign Relations Books (Penguin Press)) [Paperback]

Sebastian Mallaby (Author)

Book Description

Publication Date: April 25, 2006 | Series: Council on Foreign Relations Books (Penguin Press)

Never has the World Bank’s relief work been more important than in the last nine years, when crises as huge as AIDS and the emergence of terrorist sanctuaries have threatened the prosperity of billions. This journalistic masterpiece by Washington Post columnist Sebastian Mallaby charts those controversial years at the Bank under the leadership of James Wolfensohn—the unstoppable power broker whose daring efforts to enlarge the planet’s wealth in an age of globalization and terror were matched only by the force of his polarizing personality. Based on unprecedented access to its subject, this captivating tour through the messy reality of global development is that rare triumph—an emblematic story through which a gifted author has channeled the spirit of the age.

Editorial Reviews

From Publishers Weekly

As portrayed by Washington Post columnist Mallaby, the charming, powerful, Australian-born millionaire James Wolfensohn works to transform the World Bank, of which he is president, from a Cold War dinosaur obsessed with regulations and procedures to an organization that is leanly and meanly focused on getting underdeveloped countries onto the economic grid on their own terms. Without a doubt, Wolfensohn makes great copy: he competed in the Olympics, refinanced Chrysler in 1980 and chaired a variety of top-flight cultural institutions. Mallaby (After Apartheid) efficiently relays anecdotes from each of these periods to reveal Wolfensohn's psychological, professional and intellectual complexion. The brilliant and deliberative leader who emerges has the "10-million-volt passion" of wanting the presidency of the World Bank, and where the book really shines is in Mallaby's ability to integrate the political, social and interpersonal narratives that lead to Wolfensohn's ascension to it in 1995. Mallaby presents Wolfensohn as forcefully advocating self-determination for poor countries (not unlike "feisty" NGO "tormentors" who oppose the Bank's version of globalization), but finds that Wolfensohn has been "obliged to reckon" with the U.S.'s varying agendas "and generally with the shifting appetites of his rich political masters." That's a characterization with which not everyone will agree, but Mallaby forges it with skill, opening his subject to further scrutiny by all sides.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to an out of print or unavailable edition of this title.

From Booklist

Ninety-seven percent of Ugandans live without reliable electricity. One million Africans die from malaria every year, with 90 percent of those deaths in children under five. Those statistics of poverty and suffering were among the compelling reasons for the formation of the World Bank by Franklin Roosevelt, now more than 60 years old and with 10,000 employees. Journalist Mallaby interweaves the story of this nobly conceived effort with the ambitions of Australian-born charismatic leader James Wolfensohn, former financier and the most recent Bank leader. It is the story of politics at its worst, when multimillion-dollar projects in developing countries do little to alleviate its citizens' woes. It is the story of a determined visionary who, without adequate HR and managerial skills, still reached his goals of achieving a truce with NGOs (nongovernmental organizations) and raising the stature of the institution. Celebrity names abound, from the Clintons to Harrison Ford; it is clear that the former invisibility of the Bank has now morphed into high-end prominence. Yet its future, as Mallaby hints, might be somewhat in doubt as he probes "what next?" Barbara Jacobs
Copyright © American Library Association. All rights reserved --This text refers to an out of print or unavailable edition of this title.

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Product Details

• Reading level: Ages 18 and up
  
• Paperback: 496 pages
• Publisher: Penguin (Non-Classics) (April 25, 2006)
• Language: English
• ISBN-10: 0143036793
• ISBN-13: 978-0143036791
• Product Dimensions: 8.4 x 5.5 x 1.1 inches
• Shipping Weight: 1 pounds (View shipping rates and policies)
• Average Customer Review: 4.1 out of 5 stars  See all reviews (31 customer reviews)
• Amazon Best Sellers Rank: #252,455 in Books (See Top 100 in Books)

More About the Author

Sebastian Mallaby is the Paul Volcker Senior Fellow in International Economics at the Council on Foreign Relations and a Washington Post columnist. He spent thirteen years on The Economist magazine, covering international finance in London and serving as the bureau chief in southern Africa, Japan, and Washington. He spent eight years on the editorial board of The Washington Post, focusing on globalization and political economy. His previous books are The World's Banker (2004), which was named as an Editor's Choice by The New York Times, and After Apartheid (1992), which was a New York Times Notable Book.

Customer Reviews

Most Helpful Customer Reviews

26 of 29 people found the following review helpful:

5.0 out of 5 stars Surprisingly interesting and insightful., October 17, 2004

By 

Gaetan Lion - See all my reviews
(TOP 1000 REVIEWER)    (REAL NAME)   

This review is from: The World's Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations (Council on Foreign Relations Books (Penguin Press)) (Hardcover)

This is a very interesting book with two main themes. The first one is a biography of James Wolfensohn, the President of the World Bank since 1995. The second one is about the inner workings of the World Bank, a not so well understood institution. The author covers both themes equally well.

James Wolfensohn comes across as a brilliant and irascible complex character. He exudes charm, vision, and eloquence in the outside world towards NGOs, other governmental institutions, States, and the Media. In this capacity, he is not unlike Bill Clinton. On the inside, he is a tyrannical, terrorizing manager displaying frequent tantrums to get the cultural changes and the results he wants from his staff. Here this boss from hell comes across more like a John McEnroe loosing it on a tough line call.

The author's description of the World Bank is equally interesting. At first, the Bank comes across as an autocratic institution which knows what is best for the country it lends to. Invariably, the solution to all the World's problem according to the Bank are mega projects where private consultants and Western companies make a ton of money, the Bank books huge loans, but the country in question can ill afford. Under Wolfensohn influence, the Bank has become more sensitive to the environmental and cultural impact of its financing activities. This is in part due to the Bank opening up a dialogue with NGOs. In this regard, Wolfensohn tenure at the Bank seemed to have been rather successful, as it has radically changed the culture of the Bank.

In view of the above, I strongly recommend this book. If you are interested about economics, institutions, and policy, I also recommend a couple of excellent books. These include "A Term at the Fed" by Lawrence Meyer. This book uncovers Alan Greenspan's management style, and the inner workings of the Federal Reserve (another not so well understood institution). The other book is the excellent "In an Uncertain World" by Robert Rubin, the brilliant former Secretary of the Treasury under Bill Clinton.

14 of 16 people found the following review helpful:

5.0 out of 5 stars The Worlds Banker, November 4, 2004

By 

Hites T. Ahir (Washington, DC USA) - See all my reviews
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This review is from: The World's Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations (Council on Foreign Relations Books (Penguin Press)) (Hardcover)

Sebastian Mallaby, editorial writer and columnist at the Washington Post, has come up with a page-turner on the challenges of promoting development, as seen through the eyes of World Bank President James Wolfensohn. Many success stories of the Bank's work are described in fascinating detail. In Bosnia, according to Mallaby, the Bank played an important role in brokering a peace deal between Serbs and Croats and was successful in quickly providing money and expertise for the reconstruction. In Uganda, the Bank was flexible enough to allow a home-grown poverty reduction strategy to take root and to nurture it. But the Bank's failures are also described unsparingly. Mallaby presents a detailed study of how the Bank's condoning of corruption in Indonesia was the root cause of many of the country's troubles during the Asian crisis. He also says that the Bank late and timid reaction to fight AIDS "remains inexcusable."

The portrayal of Wolfensohn is likewise two-sided. Mallaby credits his "instincts as being ahead of his peers" on the need for providing debt relief in the mid-1990s and on tackling corruption. Wolfensohn is also recognized as being instrumental in pushing for greater country ownership of reforms and for the decentralization of the Bank through the relocation of most country directors to the field. At the same time, the book has candid descriptions of what Mallaby considers to be Wolfensohn's failures, for instance his tendency to share "credit with no one."

North-based NGOs come across in Mallaby's portrayal as the villain of the piece, Lilliputians who tie down the Bank and keep it from doing good. The NGOs, says Mallaby, have killed worthy projects by overstating the likely labor and environmental impacts and insisting on standards that developing countries can ill-afford. For example, in Laos "the environmental standards that the Bank proposed for a megadam project matched those of a country like Sweden; this was like telling the Laotians that they must not travel in motorized vehicles unless they purchased brand-new Volvos with passenger air bags."

Not all Bank failures are the fault of NGOs; sometimes, says Mallaby, the Bank cannot succeed because of lack of cooperation by the client. In 1998, the Bank wanted to execute an project to combat AIDS in Russia, but the country's health ministry did not want to acknowledge the problem. When the ministry came around, Russian pharmaceutical makers blocked the Bank, fearing that it would open the drug market to foreign competitors. Russia's medical establishment was also opposed as "hospitals had a large and antiquated infrastructure for treating TB, which would be rendered redundant by the Bank's modernizations."

Mallaby's sympathetic portrayal of the Bank contrasts with some of the harsh characterizations of other observers. In his recent book Why Globalization Works, Martin Wolf calls the Bank a "fatally flawed institution," whose source of "failures was its commitment to lending." Describing the situation when he worked at the Bank in the 1970s, Wolf writes: "every division also found itself under great pressure to lend money, virtually regardless of the quality of the projects on offer or of the development programmes of the countries. This undermined the professional integrity of the staff and encouraged borrowers to pile up debt, no matter what the likely returns." The Meltzer Commission, appointed by the U.S. Congress in 1998, made a similar charge in its report. Mallaby alludes on occasion to this pressure to lend, particularly to middle-income countries, but does give it the importance ascribed by others.

Mallaby presents shifts in the types of lending favored by the Bank as an example of its learning from experience. He notes that the Bank started with the notion that "infrastructure was the route to human betterment." Then it moved from building physical capital into building human capital by funding education projects, then from human capital into social capital by funding projects to improve the quality of institutions. And, very recently, as Mallaby notes, the Bank has partially reverted to its early emphasis on physical capital. Others put a less positive spin on the Bank's intellectual journey. For example, in his book The Elusive Quest for Growth, William Easterly-a former Bank staffer-treats the same evolution as a chase after fads that failed to deliver: "We thought that certain objects associated with prosperity in the industrialized world - dams, roads, schools - could bring success to the developing world. Later, fads changed to include institutional magical objects. Thus we urged governments to embrace democracy, constitutions, independent judiciaries, decentralization to local governments and other magic bullets. None of them worked."

While the book may not satisfy critics of the Bank, its accessibility and broad scope make it required reading not just for experts on development but for anyone with curiosity about global development, the Bank, and James Wolfensohn.

12 of 14 people found the following review helpful:

5.0 out of 5 stars Brilliant, October 22, 2004

By 

Emily Kerr - See all my reviews

This review is from: The World's Banker: A Story of Failed States, Financial Crises, and the Wealth and Poverty of Nations (Council on Foreign Relations Books (Penguin Press)) (Hardcover)

This is a wonderful book. It is really three stories. One is a story of how the West has tried to tackle global poverty, its failures, successes and U-turns. The other is a story about the West's principal instrument for these policies, the World Bank. Any large organisation, packed with interesting people, dysfunctional teams, and huge challenges will always have a good story inside it and this is no exception. The third is a biography of the leader of this organisation and his influence upon it. These three narratives, all interesting in their own right, are skillfully interwoven to produce a trully thumping read. A real page-truner.