Interviews with Robert Zoellick, President of the World Bank

September 9, 2009

Precis: The world is a complex place subject to various influences. For instance, China is cutting back on credit, which will have a dampening effect. Developing nations could provide help in the recovery, which although has begun, is still fragile and likely to be slow.

Lastly, the World Bank remains dedicated to hiring diversity.

July 10, 2010

Precis: Recovery is still fragile fraught with risk. Developing nations continue to be impacted. His job is to identify risks and make them public. Stimulus amounts in the USA were reasonable, but we must remember that it always takes much longer to execute these plans than people might imagine.

The dollar will remain the reserve currency. Despite countries like Russia and China lamenting their hostage situation, it is partly their choice which currencies they hold. Likewise, as the reserve currency, it is incumbent upon USA to follow prudent fiscal policy.

Commentary

It is always immensely interesting to listen to the heads of large states.  Besides the required diplomacy, it is an almost universal truism that his words are defined by the size of the institution.  Complexity inherently questions the ability of such a bureaucracy to solve grave issues.  They are by their nature anything but creative or adaptable.  They are inherently the product of immense political and special interest, bound by their mandates.

Bill Gates, with access to his own fortune, and much less bound by self-interested constituents, is much better situated to try and fail and try something new.

Lastly, complexity predicts that like ant colonies, the World Bank’s trillions of dollars would be put to much more effective use by self-organizing smaller groups trying and failing and learning from each other.  The monolithic bureaucracy is by its nature anything but adaptive or evolutionary, and any effective development solutions are bound to be the result of successive iterations built on thousands of errant attempts.  Besides, economies and markets are local.  You know, that is where the autonomous ant resides.

There will be more to say about that for readers confused about its implications to the economic crisis and banking reform.