Europe is at a crossroads now, and you can rest assured that the Powers That Be will be trying to influence the new leadership in whatever friendly way they can to change their minds about austerity - and in some not-so-friendly ways as well. The reality is, governments usually do what the IMF and the World Bank "persuade" them to do. The persuading has probably already begun:

Socialist Francois Hollande defeated conservative incumbent Nicolas Sarkozy today to become France's next president, heralding a change in how Europe tackles its debt crisis and how France flexes its military and diplomatic muscle around the world.

Exuberant, diverse crowds filled the Place de la Bastille, the iconic plaza of the French Revolution, to fete Hollande's victory, waving French, European and labor union flags and climbing its central column. Leftists are overjoyed to have one of their own in power for the first time since Socialist Francois Mitterrand was president from 1981 to 1995.

"Austerity can no longer be inevitable!" Hollande declared in his victory speech Sunday night after a surprising campaign that saw him transform from an unremarkable, mild figure to an increasingly statesmanlike one.

Sarkozy is the latest victim of a wave of voter anger at government spending cuts around Europe that have tossed out governments and leaders over the past couple of years.

[...] Hollande inherits an economy that's a driver of the European Union but is deep in debt. He wants more government stimulus, and more government spending in general, despite concerns in the markets that France needs to urgently trim its huge debt.

While some market players have worried about a Hollande presidency, Jeffrey Bergstrand, professor of finance at the University of Notre Dame, said it's a good thing that Hollande will push for more spending throughout Europe to stimulate the economy.

Europe is "going into a really serious and poor situation," Bergstrand said. Hollande "is going to become the speaker for those countries that want to do something about economic growth."

Meanwhile, the situation in Greece after yesterday's election is much more volatile as long as they remain chained to the euro. The country is dependent on loans from the European Union and the IMF just to survive, and they will release those funds only if Greece continues to beggar her own people:

In a surprise result, Greece's Coalition of the Radical Left, or Syriza, which seeks to annul the austerity program, saw its share of the vote more than triple, to 16.2% of the vote and 50 seats—making it the second-largest party in parliament, the ministry projections showed.

Greece's Coalition of the Radical Left, or Syriza, saw its share of the vote more than triple to 15.5%-18.5%-making it the second-largest party in parliament, exit polls showed. Alkman Granitsas reports from Athens.

Continue reading »

This is great news, and not just because it was widely rumored that Larry Summers had the job in the bag - we wouldn't want him doing to the rest of the world what he's done here. (Robert Kuttner: "For Larry Summers, Obama's nomination of Jim Yong Kim ends a winning streak of falling upwards.")

No, it's good because an impressive activist and real development professional, not a Wall St. banker, will be overseeing the bank:

WASHINGTON — President Barack Obama will nominate Dartmouth College President Jim Yong Kim to head the World Bank, a surprise pick for the international financial institution’s top job, senior administration officials said.

The Korean-born Kim is a physician by training and a prominent figure in global health and development circles. Officials believe his experience will help counter criticism from developing countries that have grown weary of the U.S. stranglehold on the World Bank presidency.

Obama took a strong personal interest in filling the World Bank vacancy after current president Robert Zoellick announced in February he was stepping down. Obama and his advisers considered more than a dozen candidates, including well-known figures in the administration. But in the end, officials said, Obama pushed for a nominee with broad development experience and was particularly drawn to Kim’s innovative work fighting the spread of AIDS and tuberculosis.

The 187-nation World Bank focuses on fighting poverty and promoting development. It is a leading source of development loans for countries seeking financing to build dams, roads and other infrastructure projects.

[...] Obama picked Kim over several more well-known candidates, including Susan Rice, current U.S. ambassador to the United Nations; Sen. John Kerry, D-Mass.; and Lawrence Summers, Obama’s former director of the National Economic Council.

Out of those people, only Larry Summers was known to be interested in the job. But I'll bet Larry Summers never rapped in one of Harvard's musicals like Kim did at Dartmouth (two minutes in):

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There are denials flurrying around, but it's still being reported as fact by Reuters:

Secretary of State Hillary Clinton is in talks to become the president of the World Bank, Reuters's Lesley Wroughton reports. Clinton's spokesman Philippe Reines offered a denial to Reuters and has been offering strong quotes to other outlets. He told NBC, "It's 100% untrue, Reuters is wrong. That's on the record." According to Reuters, which cited three different "sources familiar with the discussions," Clinton would leave the Obama administration next year to lead the organization.

Clinton has previously said she wants to leave her post at the State Department at the end of President Obama's first term. When asked early last year if she could imagine staying in the job for another four years, she answered, "No, I really can't." She also said she was "absolutely not interested" in seeking the U.S. presidency again.

Actually, this makes sense in many ways. The head of the World Bank is traditionally an American. And the current president, Robert Zoellick, was seated in 2007 for his five year term. At 63, she's certainly more than up for the challenges of the office and remain an important figure on the international scene--this was Paul Wolfowitz's old position, don't forget. And it leaves her conveniently unavailable in 2016 to run for the Presidency, which at 68 would be more strenuous than she would like.

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AP Via Yahoo:

Former World Bank chief Paul Wolfowitz, who resigned amid a furor over his handling of a bank pay package for his girlfriend, has joined the American Enterprise Institute, a think tank, as a visiting scholar.

AEI's president, Christopher DeMuth, made the announcement Monday. Wolfowitz will work on entrepreneurship and development issues, Africa and public-private partnerships, the group said in a release.

Wolfowitz's last day as head of the World Bank, a major poverty-fighting institution, was on Saturday, ending a stormy two-year run.

He was essentially forced to step down from the World Bank after a special panel found that he broke bank rules in arranging a hefty pay raise for Shaha Riza, his girlfriend and bank employee. Wolfowitz's handling of the pay package prompted a staff revolt and calls by Europeans and others for him to resign. Read more...

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ABC:

World Bank President Paul Wolfowitz has resigned his post, effective June 30. An internal panel tasked with investigating the lucrative pay and promotion package Wolfowitz arranged in 2005 for girlfriend Shaha Riza found him guilty of breaking bank rules...read on

AP photo: Paul Wolfowitz is in deep trouble with the World Bank, but like most of the Bushies---he refuses to step down. Instead, he does a "Cheney" on them all.

Sounding more like a cast member of the Sopranos than an international leader, in testimony by one key witness Mr Wolfowitz declares: "If they f*&k with me or Shaha, I have enough on them to f*&k them too."--- "Mr Wolfowitz saw himself as the outsider to whom the established rules and standards did not apply."

A Cheney in this instance is telling someone to F*&k themselves and not shooting them in the face. As always, Bush supports his corrupt pals:

White House Spokesman Tony Snow says President Bush continues to stand by Wolfowitz."The fact is that he made mistakes. They are not in our view, firing offenses," he said.
What is a firing offense to this administration? Please, tell us! C&Ler "Liberty lover," reminds me to ask the nine US Attorney's what a firing offense is. ABC is reporting that the WH is showing signs of cracking:

On the second issue, the senior official told ABC News "it is an open question" whether Wolfowitz can remain an effective president of the World Bank.

International Herald Tribune:

Paul Wolfowitz came under renewed pressure to resign as World Bank president on Monday as a bank committee formally transmitted its findings that he was guilty of a conflict of interest in arranging for a pay raise and promotion in 2005 to Shaha Ali Riza, his companion.[..]

It was not clear whether the committee, consisting of 7 of the bank's 24 board members, would remove Wolfowitz from his post or, more likely, express a loss of confidence in his leadership in a manner that might persuade him to resign. Bank officials say that a majority of the bank board has concluded that he should go.

In another sign of Wolfowitz's difficulties, his top communications aide, Kevin Kellems, resigned on Monday, saying that "the current environment surrounding the leadership" at the bank made it "very difficult to be effective in helping to advance the mission of the institution."[..]

(A senior European) official said that the overwhelming sentiment in Europe, as expressed in editorials, political commentaries and even Web logs, was that European governments should never again let the United States pick the president of the World Bank all by itself.

UPDATE: More than 50,000 Avaaz.org members from more than 180 countries have signed a global petition calling for Wolfowitz to be fired. At 1 pm tomorrow--Wednesday, May 9--join us for a rally outside of the World Bank headquarters at 1818 H St NW in DC to deliver the petition. We'll have a banner reading "World to Bank - Fire Wolfowitz," and flags from around the world.