November 8th, 2010

Robert Zoellick, chosen by George Bush Jnr to head the World Bank:

The [international monetary] system should also consider employing gold as an international reference point of market expectations about inflation, deflation and future currency values…. Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today.

Via Brad deLong and Paul Krugman, who have difficulty believing it.

Zoellick´s predecessor was the even less qualified neocon warmonger Paul Wolfowitz.

Can someone remind me – and, more´s the point, Dilma Rousseff, Manmohan Singh, and the rest of the class of developing-country leaders – exactly why the United States gets to treat this really quite important and technically demanding job as a patronage reward for pensioned-off apparatchiks?

Wait a minute, when Wolfowitz quit in disgrace in 2007 :

Brazil, South Korea, China and Pakistan were among a group of developing nations that called for a more transparent process for selecting the head of the bank …

The calls will be much less deferential next time.

Update 11 November
Zoellick has walked back from his gold-bug sentence – but doesn´t rescue his reputation.

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One Response to “Gold bug”

  1. paul says:

    For “United States” sub “Most recent republican administration” and the question pretty much answers itself. Although the job always seems to have been somewhere that old white lions go to bask, previous appointments appear to have been fairly serious (for better or worse). (Of course, a lot of people believe that the Wolfowitz appointment was also quite seriously intended — rather than pensioning Wolfowitz off, it was about storming another bastion of the reality-based community. And indeed Wolfowitz reportedly shook the organization up quite a bit, installing lickspittles and cronies throughout the upper echelons.)

    I wish the developing countries luck — the Bank and its associated institutions have long been an arena for the economic powers to play political football and “spheres of influence”.