A tribute to the World Bank’s treasury department

IFR IMF/World Bank 2021
12 min read

The following is a copy of a speech that was due to be made by Eugene Rotberg, the World Bank’s former treasurer, on the occasion of a reunion dinner to celebrate the 50th anniversary of the World Bank’s treasury department. The dinner had been scheduled to take place in April 2020 but, thanks to the coronavirus pandemic, that was not possible. Those involved are hoping to reschedule the dinner but, in the meantime, this is what Gene was planning to say.

When I was asked me to make some remarks at this 50-year reunion, I was ambivalent for several reasons.

I was concerned that I would sound like one of those out-of-it greybeards who pretended that we were smarter, more innovative, worked harder, than those who followed us; that things were better in the good old days. Such nonsense.

I was reminded of the story about the customer, who upon entering a restaurant asked to be seated. The maitre d’ explained that there were no empty tables and that the customer had no reservation. The customer insisted on a table. The maitre d’ again explained it was not possible. They were overbooked. The customer persisted. “Don’t you know who I am?” The maitre d’ replied, “No, who were you?”

I was also ambivalent about this whole business of reunions. As Byron put it eloquently:

When we two parted

In silence and tears,

Half broken-hearted

To sever for years, ...

If I should meet thee

After long years,

How should I greet thee?

With silence and tears.

And I was concerned that you would notice my walker, my slowness and slurring of speech and the quivering in my left hand. You would whisper among yourselves: “He’s changed. Parkinson’s?” I remembered that when I was 80, I bragged to my doctor that I saw no evidence of dementia, I had no short-term memory loss, my deductive skills were just fine and I could still figure present-value calculations in my head. He replied: “Just wait until you’re 90.”

Soon I realised that my ambivalence about speaking to you simply reflected my overwhelming need to be loved and respected without any qualification by all of you – that I was the same as 50 years ago. But, as a friend recently put it: “You soon will be 92. Get over it already.”

But one thing I will not get over is what you have done.

You and your successors raised $900 billion in world capital markets and invested those funds pending their disbursement to poor countries.

To what end, you may ask? Life expectancy went way up. Fewer children died before the age of five. Hundreds of millions of boys and girls for the first time went to school. Safe water and electric power became available. Far fewer lived in absolute poverty. Far fewer died of starvation. Hundreds of millions more could read and write. Fewer little girls needed to work knee-deep in mud in rice fields. Far less infant and maternal deaths at childbirth. More democracy. More civil discourse. Hundreds of millions more now have hope because of you.

Let me be specific. In the 1980s, two billion people on our planet lived in extreme poverty earning less than $2 a day. Today, 500 million. Fifty years ago, 280 million children under the age of five were underweight. Now 80 million. Life expectancy in India went from 41 years in 1958 to 65 years today. In Bangladesh, 21% were literate in 1960, 65% today can read and write. In China, 37% were literate in 1960, now over 90%. Child mortality worldwide in 1960 was 22%. It’s now 4%.

That’s to what end, you might say to your children and grandchildren and friends who needle you for casting your lot with the establishment.

There would have been little foreign investment or commercial bank lending had you not first provided the resources needed for infrastructure, roads, airports, rail, ports, schools, hospitals, health centres, agricultural finance, dams, disease control, power grids, safe water supply – matters rarely financed by the private sector.

But you will not get credit – your name will not be recognised – because immortality is mostly reserved for writers and poets, for artists and composers and sculptors who leave behind the evidence of their work, with their names attached, and whose works are loved and seen and heard over and over, generation after generation. Verdi’s “Va, Pensiero” and Mahler’s adagios will bring chills forever.

But you will have no such legacy, though without you those enormous changes for the better would not have happened. Children simply would not have been born. That little kid flying a kite in Afghanistan and that little girl bent over washing clothes in a stream in Peru owe their lives – their very existence – to you. One day they will work together – at Mayo Clinic or Geneva – and find a cure for cancer. That is your immortality.

It is of a different kind – silent, unknown. No medals, no chills. They never heard of you. Just no more cancer.

And you shared your wisdom and expertise with the poorest in the world. And with your successors. You trained and mentored thousands who went back to their home countries with expertise in raising resources and investing wisely.

The result: some of the poorest countries in the world – the likes of Ghana, Bulgaria, Columbia, Ivory Coast, Dominican Republic, Egypt, Ecuador, Fiji, Indonesia, Morocco, Pakistan, Peru, Vietnam – raised $250 billion in capital markets to alleviate the corrosive effects of poverty – violence, lethargy, heartache.

There is another development that reflects on what you did – rarely acknowledged. You showed the world how a country could intermediate another country’s savings through the capital markets to purchase goods and services from a third country to be used to facilitate the economies of all countries. You provided, therefore, the indispensable finance; the link to facilitate trade among nations; to integrate the economies and output of the peoples of the world. You were – are – the linchpin, the “sine qua non” of globalisation. Irreversible.

A digression

But suppose I am wrong and it is all reversible. Giles Harvey in The New York Times recently quoted Kazuo Ishiguro’s acceptance speech for the Nobel Prize for Literature. Ishiguro spoke the unthinkable. “I woke up recently to the realisation I have been living some years in a bubble. I realise that my world – a civilised place filled with ironic liberal-minded people – was in fact much smaller than I ever imagined ... the most unstoppable advance of liberal humanitarian values I’d taken for granted since childhood may have been an illusion.”

I share Ishiguro’s angst. I fear that globalism has been checkmated by “America First” here in the United States.

We have seen movements to the right throughout the world, not just in North Korea or Iran or Yemen or Syria, but in Greece, The Philippines, Poland, the Stans, Cambodia, Venezuela. Beggar thy neighbour. Do it alone. Isolate. Brexit. Punishing tariffs. Restrict the flow of savings to within one’s borders, limit immigration, subsidise domestic investments, penalise “foreign” investment, impose quotas and sanctions.

The bedrock principle of these policies is to insulate – perhaps isolate is a better word – one’s country from the “foreign” influence of ideas, trade, or external financial resources, all of which are considered a weakening of the purity of society. That is a direct confrontation with globalisation and the free and open transfer of people and financial resources between nation states and individuals.

You will argue that these are merely temporary aberrations that do not in any way threaten the basic lessons of inclusiveness and diversity – the hallmarks of globalisation.

Indeed, you will point out that each upheaval and structural change – the violent French and American revolutions in the late 18th century, the social revolutions of 1848, the assassinations of royalty in the late 19th century, the dissolution of monarchies at the end of World War 1, the rebalancing in the 1930s of the social structure in the US, the Civil Rights Acts of the 1960s – resulted in more inclusive societies and strengthened cross-border relationships.

It was with pride and no sense of embarrassment that I could quote John Donne.

Any man’s death diminishes me,

Because I am involved in mankind;

And therefore never send to know for whom the bell tolls;

It tolls for thee.

The question haunts whether the teachings of 20 years of classics seminars at St. Johns College have already been vanquished. I don’t think so. But the great debate – which policies will win out? – is not over: beggar thy neighbour or share with thy neighbour; exclusiveness or diversity; tariffs or a free flow of goods and services; restrictions on the cross-border flow of resources or their absence. I suspect that our grandchildren and their grandchildren will find that these matters will remain unresolved.

Not forgotten

Let me conclude with some personal remarks. When I came to the bank, I hardly knew a stock from a bond. You protected me from foolishness. You let me take the credit for what you developed. You covered up my mistakes. You let me introduce innovative ways to evaluate risk and raise resources as if they were my ideas. When I left the bank, you were still working on that magic zero-coupon bond with a perpetual maturity. And your successors are still trying.

You let me pretend, because I was the public face of the treasury department, that I understood the cashflow of swaps. No, only Lester Siegel did.

You permitted me to ignore administrative and management matters, indispensable stuff for which I was quite unequipped and uninterested in handling. In short, you permitted me to love going to work every day for two decades. All of that goes way beyond thank you.

When I left the bank over 35 years ago, in a letter to all of you, I quoted the English poet, Robert Bridges.

I will not let thee go.

I hold thee by too many bands:

Thou sayest farewell, and, lo!

I have thee by the hands,

And will not let thee go.

It still applies to all of you.

Finally, a word about those who informed all of us. And whose names mostly have already been forgotten. Those whose names will never appear in the history books. Those whose names soon, probably in a generation, will never be spoken again out loud publicly except for this one last time.

Burke Knapp, Bernie Bell, Shahid Hussein, Munir Benjenk, Dennis Ricket, Bill Diamond, Mohamed Shoab, Siem Alderweld, Raymond Cope, Joe Uhrig, Jocelyn Radifera, Ray Deely, Del Harris, William Clarke, Bill Van Saagsveldt, Hugh Scott, Ronnie Broches, Ray Goodman, David Hopper, Monte Yudleman, John Adler, Ben Prinz, Jean de Boeck, Aritoshi Soejima, Lester Nurick, Peter Cargill, Sheldon Rappaport, YL Chang, Victor Chang, Frances Poole, Bob Cavanah, Maboub Al Haq, Roger Chaufournier, George Gabriel, Ibrahim Shihata, Warren Baum, Hans Hittmair, Ernie Stern and Edith Kesterton.

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