Abandoning the World Bank: Pitfalls When Right and Left Agree

In 1994, activist groups mounted a unified campaign against the World Bank and its sister organization, the International Monetary Fund (IMF). The two institutions were then celebrating a half-century in business, having been founded at the Bretton Woods conference near the end of the Second World War. The name of the activist coalition, and its slogan, was “50 Years Is Enough.”

The group’s call to action against the international financial institutions seemed to come at an inopportune moment. The mid-1990s were high times for corporate globalization. Enthusiasm about the expanding “New Economy” was rising. The Clinton administration placed structures like the World Bank, the IMF, and the World Trade Organization (WTO) at the center of its foreign policy, and the march of economic neoliberalism seemed unstoppable.

By the institutions’ sixtieth anniversary in 2004, however, things had changed. Crises in Asia and Argentina helped to quell international exuberance for the policies of the Washington Consensus. The left’s critique—which challenged the World Bank’s practice of forcing structural adjustment on countries needing loans, its support for environmentally destructive dams and other megaprojects, and its undemocratic governance structure—drew mass protests to previously inconspicuous World Bank meetings. And the Bank was compelled to launch a major public relations offensive promoting its righteous mission of ending poverty. Yet perhaps more disconcerting still for World Bank defenders, influential conservative economists and Bush administration officials were also ready to declare “enough.”

In the Bush years an interesting landscape has appeared. The White House has maintained at best a lukewarm relationship with the World Bank—and at times has abandoned it altogether. Conservative critics have presented a vision of a world without the Bank. In this new context, progressives have been called upon not only to distinguish their own demands but also to consider the possibilities for some unusual alliances.

Decline of Multilateral Globalization

In the Clinton era, American power was deployed to expand and defend a corporate-friendly, “rules-based,” multilateral global economy. In contrast to this Clintonian “corporate globalization,” Bush has crafted a more aggressive, unilateralist “imperial globalization.” Here, the United States is willing to antagonize traditional capitalist allies in pursuit of nationalistic economic gains. Both visions of the global order are neoliberal, but they differ significantly in their management of international affairs.

The neoconservatives’ assertive militarism, disregard for U.S. “soft” power, and eagerness to cut off uncooperative “Old Europe” from the spoils of the Iraq War are part of the shift. Another part has been a willingness to sidestep or even undermine the multilateral structures of corporate g...