120/YOUR MONEY OR YOUR LIFE!
The influence the Bank enjoys today derives in large part from the
patronage networks it established in countries that later became its
customers and, of course, its debtors. The World Bank pursued a
policy of active influence-peddling in order to build up its network
of debtors.
From the 1950s onwards, one of the Bank's main objectives was
to 'build up institutions'. This building programme usually involved
the creation of autonomous agencies within governments, agencies
which became long-term borrowers from the World Bank. Such
agencies were intentionally founded in such a way as to be relatively
independent financially from their governments and free from the
control of local political institutions. They became natural relays for
the Bank, to which they owed their very existence.
The creation of these patronage networks was a cornerstone of
World Bank strategy for getting involved in the economic policies of
Third World countries.
Obeying no rules but their own (often drawn up in keeping with
World Bank recommendations), staffed by big-name local
technocrats who shared World Bank aims, championed and admired
by the Bank, these agencies served to create a stable and reliable
source for what the Bank needed most: 'viable' loan proposals. They
also provided a parallel power base through which the Bank was able
to transform national economies - nay, entire societies - without
having to bother with the 'cumbersome' process of democratic
control and debate.
The implications of such a policy are most worrying. The
International Legal Center (ILC) in New York carried out a study of
the Bank's involvement in Colombia between 1949 and 1972. The
ILC report concludes that the Bank's autonomous agencies had a
profound impact on political structure and social development
throughout the region. They weakened 'the system of political parties
and the respective roles of the legislature and judiciary' (Rich, 1994).
By the 1960s the Bank had set up its own new mechanisms for
continually intervening in the internal affairs of borrower-countries.
The Bank, however, emphatically denies that such interventions are
political in nature. On the contrary, it insists that its policies in no way
impinge on power structures, and that political and economic
matters occupy two discrete spheres.