Battle For The World Bank, Round Two

Robert Zoellick is entering a war zone. The forces of corruption at the World Bank have won their first battle, with Paul Wolfowitz as a high-profile casualty, and they are pressing forward.

Victory, which they define as the complete removal of Bush and Wolfowitz fellow travellers who have reform on their mind, is near, so they have shifted their focus to Wolfowitz-ite Suzanne Rich Folsom, who heads the bank's Department on Institutional Integrity.

(What better place for the forces of corruption to attack?)

We pick up the story in today's WSJ op/ed:

Mr. Zoellick's first test will come early. As we go to press, sources inside and outside the bank tell us that a follow-up to the putsch against Mr. Wolfowitz is being engineered by Managing Director Graeme Wheeler and Staff Association Chair Alison Cave against Suzanne Rich Folsom, who runs the bank's Department of Institutional Integrity, or INT. Ms. Folsom, an ethics lawyer brought in by former president Jim Wolfensohn and promoted to her current job by Mr. Wolfowitz, has been aggressively pursuing corruption investigations, much to the alarm of some at the bank.

Prominent among those investigations is one concerning an Indian health project. Irregularities in the project, including indications of bid-rigging and bribery, led Mr. Wolfowitz to veto further loans to India in 2005 while the investigation unfolded, despite fierce protests from the project's managers. Now that the INT is about to issue a report about the project, Mr. Wheeler has been lobbying the bank's executive directors to place Ms. Folsom on administrative leave, and for the INT's oversight responsibilities to be radically diminished.

If Zoellick stops Wheeler and Cave in their tracks and supports a strong and independent INT, he will be signaling the World Bank community that the name on the door might have changed, but the direction of management has not.

If Folsom falls, Zoellick will be telling us he either lacks the will or the power to fight the corruption that is at the core of the world bank.