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#WDR2018 Reality Check #17: The World Bank’s Reports and its Practices – Organised Hypocrisy? By Salim Vally

This blog argues that the inconsistencies of the World Bank seen as instances of ‘organised hypocrisy’ and ‘duplicity’ are not new nor are they limited to the area of education. On the heels of the WDR, another significant World Bank report, The Changing Wealth of Nations 2018: Building a Sustainable Future, was released. I briefly discuss the latter report but also remind colleagues of the devastating impact of the WB and other Bretton Woods institutions on poorer nations – practices which continue today.

Colleagues in previous blogs (such as here, here, and here) have already commented on the ‘organised hypocrisy’ of the WDR, , which reflects the World Bank’s hypocrisy in broader education policy and practice (see for example here and here). Some of the critiques – even when they acknowledge the sensible parts of the WDR – refer to the contradictions between the stated diagnosis of what the WB calls the ‘learning crisis’ and the practices of the Bank, particularly the operations of its International Finance Corporation (IFC), in exacerbating the ‘learning crisis’.

The WB’s Changing Wealth of Nations reports the national wealth of 141 countries over 20 years from 1995 to 2014. Importantly, the report introduces a new measure ‘Adjusted Net Savings’ which includes the depletion of non-renewable natural resources, air pollution as well as unpaid women’s work and community work absent from traditional measures of wealth such as the GNI and GDP. The report provides new evidence of the looting of resource-rich countries, most of them in Africa, by vested foreign interests. Yet, WB practices remain oriented to enforcing loan repayments and transnational corporate profit repatriation, reinforcing plunder through rampant mineral, oil and gas extraction. These resource rich countries face a ‘resource curse’ – despite the increasing extraction of their natural riches, they are getting poorer. For D. Amari Jackson, this ‘curse’ is largely facilitated by the World Bank itself (Jackson, 2018). Frédéric Mousseau, the policy director of the Oakland Institute argues, “In its usual schizophrenia the Bank calls for better governance and stronger institutions while also advocating for pro-business policies that would allow the private sector to flourish” and asks, “How can low-income countries build stronger institutions while the World Bank pushes them to deregulate, cut taxes and thereby reduce the resources available for public intervention in their economies?” (Ibid). Elsewhere, Inclusive Development International together with others show how the IFC financed some of Africa’s most notorious land grabs (Roasa, 2017) and Oxfam has shown how 51 of the 68 companies lent money by the IFC to finance investments in sub-Saharan Africa use tax havens to avoid paying taxes for their ‘investments’.

Both WB reports ignore the destruction wrought by the Structural Adjustment Policies (SAPs) of the eighties, support for authoritarian regimes and the lifeline given to the apartheid regime in South Africa. Writing of the devastating effects of these policies the report of the UN’s Secretary General concluded in 1988, “The most vulnerable population groups, in particular women, youth, the disabled and the aged, have been severely and adversely affected” (Danaher, 1994). The consequences of WB and IMF policies continue to ravage many countries today.  

The South African government, under the tutelage of advisors and consultants from the WB and IMF adopted a neoliberal macroeconomic policy in 1996, which has continued to engender massive inequality in all sectors of society including education. I’ve shown elsewhere (Vally, 2018) that while the WDR takes a dim view of the private provision of schooling, the IFC aggressively supports private so-called ‘low cost schooling’ in South Africa exacerbating inequality. The IFC participated in the development of the Curro group (the biggest for-profit school group in South Africa) and its expansion (World Bank, 2012).

More recently, the WB promoted ecologically destructive policies such as coal-fired power plants, investments in companies involved in corrupt practices and $200m worth of financing to Lonmin platinum mine in Marikana prior to the ‘Marikana Massacre’ of 34 striking mineworkers in 2012 (Bond, 2014). Two weeks after the massacre, the president of the WB, Jim Yong Kim, visited South Africa but gave Marikana a wide berth, neglecting “to check on his Lonmin investment in Marikana and instead gave a high-profile endorsement to an IFC deal with a small junk-mail printing/posting firm that was prospering from state tenders” (Ibid).

SAPs and support for authoritarian regimes by the IMF and WB has not ended. Mahinour el-Badrawi and Allison Corkery detail how a recent IMF/WB loan of $15 billion  to the military regime of Egypt “pushes classic austerity-based policies… which will aggravate poverty and inequality on a large scale.” This relationship provides succor to a regime which has jailed under appalling conditions 60 000 people according to some estimates, including a significant number of educators.

Perhaps the inauguration of Jim Yong Kim, largely seen as a critical intellectual and with an important earlier role in Aids treatment advocacy, gave the tarnished image of the WB newfound credibility. A recent flamboyant New York Times article, titled The World Bank Is Remaking Itself as a Creature of Wall Street (Thomas, 2018), is revealing about Kim’s strategy to enlist the support of private capital and the Trump administration. The article is embellished by Kim’s earlier work in the slums of Haiti, the influence of liberation theology and Chomsky, how he “devoured Marx as a young man” and recently presented Macron with a copy of Said’s Orientalism, but also how he golfs with Michael Bloomberg and socializes with billionaires like Leon Black and David Rubinstein. We read how,

“Kim’s mission is to revitalize the World Bank by increasing its firepower and winning over the United States … [H]e is pushing private investors … to pony up trillions of dollars for projects in Indonesia, Zambia, India and elsewhere. His pitch: They can reap rich returns by putting their money to work alongside the World Bank.”

The article also details his work with Ivanka Trump and presenting the WB to Trump “as a tool to enhance the administration’s “America First” policy.” The President of the WB’s initiatives come at the same time the Trump administration announced that it was withholding $65m out of a $125m aid package earmarked for the United Nations Relief and Works Agency for Palestinian refugees (UNRWA). Schools run by the latter are lauded in the WDR. I therefore concluded my contribution to a forthcoming moderated discussion of the WDR for the Comparative Education Review in the following manner:

A colleague posed the question: “Is the WDR with some of its progressive statements just a side-show, a sop for the intellectuals within and outside [the WB’s] ranks?” I tend to agree with Steven Klees (2017), who exhorts us to challenge the legitimacy of the WB and the IMF as “undemocratic, technocratic, neoliberal institutions unfit for the necessities of today’s world.”

In other words, nix it, don’t try to fix it and don’t be deceived by the World Bank and Kim’s strategy – a variation of ‘talk left, walk right’. We should rather spend our intellectual resources in supporting those grassroots organisations that have to deal with the rapacious practices of the WB, the IMF and the elites they support.

#WDR2018 Reality Check is a blog series organized by Education International.  The series brings together the voices of education experts and activists – researchers, teachers, unionists and civil society actors - from across the world in response to the 2018 World Development Report, Learning to Realize Education’s Promise. The series will form the basis of a publication in advance of the WB Spring Meetings 2018. If you would like to contribute to the series, please get in touch with Jennifer at jennifer.ulrick@ei-ie.org. All views expressed are those of the authors alone and do not represent the views of Education International.

Check out the previous post in the series by Carol Anne Spreen: #WDR2018 Reality Check #16: Early Childhood Education, Poverty and Privatization: Why is ECE so important and underfunded in World Bank policy?

References:

Bond, P, (2014), ‘Marikana’s Meaning for Crisis Management: An Instance of South Africa’s Resource Curse in Ulrike Schuerkens (ed),Global Management, Local Resistances - Theoretical Discussion and Empirical Case Studies, New York: Routledge.

Danaher, K, (1994), 50 years is enough – the case against the World Bank and the International Monetary Fund, Boston: South End Press, p 3.

Klees, S. (2017).A critical analysis of the World Bank’s World Development Report on education. Breton Woods Project: Critical Voices on the World Bank and IMF.

Jackson, D. A, (2018), ‘The Elephant in the Room’: New World Bank Report Only Confirms Its Complicity In Sucking Resource-Rich African Nations Dry, Atlantic Black Star, February 16, 2018.

Roasa, D, (2017), Unjust Enrichment: How the IFC Profits from Land Grabbing in Africa - Outsourcing Development: Lifting the Veil on the World Bank Group’s Lending Through Financial Intermediaries. Published by Inclusive Development International, Accountability Counsel, Bank Information Center, The Oakland Institute and Urgewald.

Thomas, L. (2018, 25 January). The World Bank is remaking itself as a creature of Wall Street. New York Times.

Vally, S (forthcoming 2018) ‘The Privatisation of Schooling in South Africa’, in Kenneth Saltman and Alex Means (eds), Handbook of Global Educational Reform, Wiley-Blackwell.

World Bank Group, (2012), Africa Constituency, FY10 Annual Report, Annex 4, Projects approved for constituency countries, p. 64.


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Salim Vally

Salim Vally is director of the Centre for Education Rights and Transformation, an Associate Professor at the Faculty of Education, University of Johannesburg and a Visiting Professor at the Nelson Mandela University. His recent books are: Reflections on Knowledge, Learning and Social Movements: History's Schools (co-edited with Aziz Choudry; Routledge, 2018) and  Education, Economy and Society (co-edited with Enver Motala; UNISA Press, 2014).

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