In his new famous foreign and retrenchment memo of
January 27, 1981, David Stochman, director of the Office of Management and
Budget of the Reagan administration, proposed that the United States revoke its
pledge to the sixth replenishment of
IDA, cut its contribution by half, and ceases to provide paid-in capital to the
World Bank. At the same time, an ideological assault on the bank has started to appear in editorial published in
the Wall Street Journal. Several articles, authored
by right-wing political commentators and published in the New York times, have
criticised the bank for “supporting socialism”, “subsiding utopianism” and
using American taxpayers’ money for “little experiments in so-called social
progress”. The editor of “Foreign Policy” magazine, Mr. Bill Maynes, who
previously held the position of Under-Secretary of State for International
Organisation in the Carter administration, said, “when you see how brazenly the Reagan administration
handled an issue like the World Health Organisation infant formula code,
backing industry completely and standing alone with a single “No” vote, you
can’t double their arrogance when they take up the issue of lending for
development.”
One criticism of the bank by the Reagan administration is
that “it has grown too big too fast”. When Mcnamara took office in 1969, the
bank’s resources stood at about N680.7 million; but now N8.2 billion is
available for lending. But Mr. Robert Ayres, senior fellow at the Overseas
Development Council, a key group in the US development lobby, points out. This
amount really provides about one per cent of the total external capital needs of
the Third World. He estimates that in order to support a 3.5 per cent growth
rate during the 198s, the least developed countries may be as high as high as
N118 billion yearly. Furthermore, figures show that while the United States has
contributed about N667 million to the bank since its inception in 1946, bank
loans to other countries have generated about N4.6 billion in contracts to
American companies. The Reagan administration also criticises the bank for
being inherently less capable of pursuing development than the United States
through its own agencies, and particularly through private enterprise.
QUESTIONS
a) Give
for each of the following a single word that could take its place in the
passage: (i) pledge (ii) assault (iii) authored (iv) rightwing (v) brazenly
b) Give
three attacks, according to the passage, made against the World Bank
c) State
one criticism of the Reagan administration against the Bank
d) (i)
The resources of the World Bank provide the needed external capital needs of
the Third World? (ii) Why
e) How
has the United States benefitted from the Bank
ANSWER TO MODEL QUESTION
a) (i)
promise (ii) attack (iii) written (iv) conservative (v) openly
b) (i)
It is propagating socialism and subsidizing utopia (ii) It has grown too big
too fast (iii) Reagan administration says it is wasting the American tax payers’
money on little experiments in social progress
c) It
is less capable of pursuing development than the US through its agencies
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