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business newsFatal Attraction in the Boardroom: Former World Bank President Invades Iraq, Girlfriend's Life
By
Josh Lipton Feb 11, 2010 4:55 pm
Paul Wolfowitz helps broker his sweetheart's pay hike.
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Paul Wolfowitz, the soft-spoken political scientist-turned-policymaker who worked as a principal architect of the war in Iraq, became president of the World Bank in 2005, focused, as he told reporters at the time, on spreading human rights and political freedoms.
The lofty humanitarian goal, though, proved very short lived: Just two years later, the veteran Pentagon official was run out of the institution, amid charges of ethical misconduct.
The problem for the former deputy defense secretary?
The man was just trying to do good by the love in his life. Wolfowitz stood accused of personally intervening in the career of his girlfriend, Shaha Riza, who worked at the World Bank as a communications specialist.
In a story about Wolfowitz, before the scandal erupted inside the Beltway, The New Yorker described Riza as an Arab feminist who had an influence on Wolfowitz's thinking.
According to the magazine, Riza, who was born in Tunisia and reared in Saudi Arabia, studied international relations at Oxford and subsequently became an advocate of democracy and women's rights in the Islamic world.
As Newsweek magazine detailed, after fist seeking to recuse himself from decisions concerning Riza in 2005, Wolfowitz heeded the recommendation of the bank’s ethics committee and had his companion moved to the State Department.
But then, according to reports, on August 11, 2005, Wolfowitz made the decision that would cost him his cushy gig: He directed the vice president for human resources at the bank to shower Riza with a nearly 40% pay hike to $180,000 after taxes, and specified how she was to be promoted.
Wolfowitz would later apologize for meddling with his partner’s pay scale.
“In hindsight, I wish I had trusted my original instincts and kept myself out of the negotiations,” he said.
Ultimately, the mea culpa wouldn’t matter.
Wolfowitz, unable to beat back the charges of misconduct, stepped down from the World Bank in May 2007.
He said he was gratified that the board at the bank “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."
He decided to resign, he said, because “it was in the best interests of those whom this institution serves for that mission to be carried forward under new leadership.”
The bank’s board, for its part, said a “number of mistakes were made by a number of individuals” and issued a statement, noting that changes had to be made to the “governance framework of the World Bank Group.”
Truth be told, though, the problems for Wolfowitz at the World Bank started long before the brouhaha boiled over with his girlfriend.
His resume as a certified Neocon hawk proved way too much to handle for many of the World Bank’s left-leaning member nations and 7,000 Washington employees.
In addition, Wolfowitz also managed to alienate many inside the World Bank, as the Wall Street Journal noted at the time, by relying on sometimes “brash” aids with ties to the Bush administration, and campaigning hard to curb corruption, which critics charged only ended up hurting the poor in those nations.
The politics surrounding the scandal became heated and personal.
Defenders of Wolfowitz, like the editors at the Wall Street Journal, said that the effort to unseat him amounted “to a political grudge by those who opposed his role in the Bush Administration and a bureaucratic vendetta by those who opposed his anti-corruption agenda at the bank.”
Detractors also weighed in, with Maureen Dowd of the New York Times calling Wolfowitz a “demented visionary” and “walking curse on the world” who imagined “an Iraq that didn’t exist.”
Ultimately, though, despite the headline-making dust-up and shrill criticisms, Wolfowitz ended up just fine with a very comfortable new job: visiting scholar at the American Enterprise Institute, a Washington DC-based think tank.
There, the Brooklyn-born academic spends his time researching development issues, Africa, and public-private partnerships.
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