When you say the word “bank,” most Americans will hiss, growl, and throw holy water in your direction. After all, the 2008 bailout left most of us horrified, angry and dumbstruck. But then there's the World Bank Group, which is more of an agency of the United Nations and a generous undertaker of the world's poverty problems. Their website lists their mission: “To fight poverty with passion and professionalism for lasting results. To help people help themselves and their environment by providing resources, sharing knowledge, building capacity, and forging partnerships in the public and private sectors1.”
The World Bank Group wasn't always like this, however. It didn't always lend out so much money and aid struggling countries with such intensity. It took a new Bank President to accomplish this goal. Someone who wanted to help people, who wanted to push the Bank to its limits, who wanted to leave their past behind. Someone named Robert S. McNamara.
Established in 1944 in order to help finance the war ravaged Western Europe after World War II, the World Bank Group seemed to care more about its investors than the need of developing countries. In 1968, that all began to change when Robert S. McNamara took the helm. It was announced by Lyndon B. Johnson on November 29th, 1967 that McNamara would leave his seven years as U.S. Secretary of Defense behind to become President of the World Bank Group, and on February 29th, 1968, McNamara did just that2.
(Robert S. McNamara, 1981,http://siteresources.worldbank.org/EXTARCHIVES/Images/Robert_McNamara.jpg)
Robert S. McNamara entered the World Bank Group with a clear image of what had to be done. Not enough money was being lent, and he began an aggressive strike towards making developing countries the number one concern, instead of investors' needs. He firmly believed that in order to succeed, the Bank needed to be more daring and take more risks. Small lending wasn't good enough— they needed to be much larger, and more data was required in order to go about the best way of accomplishing this new goal. He hired Hollis Chenery as an economic adviser and teamed tech specialists with economists. In this way he formed better cooperation and developed plans that were not only technologically advanced but catered to human needs.
Robert S. McNamara introduced two five-year plans. The first demanded that the loaning volume be doubled. His second plan demanded 40% more loaning than the previous. These goals were accomplished, and poor nations were given much needed loans. Jamaica was given 2 million for family planning in 1970 and Brazil was given 19 million for nutrition in 19763, just for example.
In regards to the Bank, McNamara once said: “A major part of the [Bank's] program... must... attack absolute poverty, which exists to a totally unacceptable degree in almost all of our developing countries: poverty is so extreme that it degrades the lives of individuals below the minimal norms of human decency4.” He was truly concerned about the welfare of his fellow mankind. By June 30, 1981, when he ended his stint as World Bank Group's President he had gotten the Bank engaged in all developing countries, increased staff 125% from 1968 to 1973 for a total of 5700, and created a net borrowing average of 780 million5.
I was astonished to learn how much Robert S. McNamara changed the World Bank Group. Even today, their main goal is to reduce world poverty, which seems to come from McNamara's intense plans that increased lending overall. In just 13 years he revitalized the Bank. It takes a lot of brains and strength to do something like that.
Notes
1. "About Us." 2011.http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/0,,contentMDK:20040565~menuPK:1696892~pagePK:51123644~piPK:329829~theSitePK:29708,00.html
2. "Robert S. McNamara." http://www.defense.gov/specials/secdef_histories/bios/Mcnamara.htm
3. "Pages from World Bank History - Bank Pays Tribute to Robert McNamara." March 21, 2003.http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/EXTARCHIVES/0,,contentMDK:20100171~pagePK:36726~piPK:36092~theSitePK:29506,00.html
4. Weiss, Charles. "Science and Technology at the World Bank, 1968–83.." History & Technology, March 2006, [81].
5. " Robert Strange McNamara." 2011.http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/EXTARCHIVES/0,,contentMDK:20502974~pagePK:36726~piPK:437378~theSitePK:29506,00.html
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