79066 Official Use Only THE WORLD BANK GROUP ARCHIVES ORAL HISTORY PROGRAM Transcript of interview with GEOFFREY B. LAMB November 19, 2007 Washington, D.C. Interview by: William H. Becker 1 Session 1 November 19, 2007 Washington, D.C. [Begin Tape 1, Side A] BECKER: Good afternoon. Today is November 19, 2007. I'm William H. Becker with the Business History Group and The George Washington University. I'm at the World Bank headquarters in Washington, D.C. to interview Geoffrey B. Lamb, who retired from the Bank in 2006. LAMB: That's correct. BECKER: Mr. Lamb, it's nice to meet you . LAMB: Hi. BECKER: .. and I look forward to our conversation this afternoon. I'm going to start with a fairly obvious question. When and where were you born? LAMB: I was born in Boksburg,South Africa, in February 1944. BECKER: I know that you're an Irish national. How is that you were born in South Africa? LAMB: Ah. Well, I was born of South African parents, and grew up and went to school and university there, and I was then involved in the underground anti-apartheid movement in South Africa as a student, and then as a young journalist, and was in prison for a short while, and then in political exile in the U.K. And one of the things that the South African regime at that time did was take away the passports of its . BECKER: I see. LAMB: .. enemies. BECKER: I see. LAMB: And, fortunately, my forebears were Irish and-on my mother's side, and, fortunately, the Irish, being a country that suffered emigration, have rather liberal rules about bringing folks home . BECKER: Okay. Geoffrey B. Lamb November 19, 1007-Final Edited 2 LAMB: .. as it were. So I became an Irish citizen .. BECKER: I see. LAMB: .. shortly after leaving South Africa. BECKER: Okay. And you left South Africa . LAMB: In 1965, I think. BECKER: Fine. LAMB: '66. BECKER: Okay. Now what . LAMB: The mid '60s. BECKER: Okay. You received a B.A. from the University of-is it . LAMB: Witwatersrand. BECKER: Yes, Witwatersrand. What did you major in? LAMB: Economics and political science. BECKER: I see. Okay. And you said you had your pre-university education in South Africa. LAMB: Yes, that's correct. BECKER: Was it in the public schools, or . LAMB: It was in a government school. Yes, a government boarding-a sort of odd elite government boarding school that was aping the British public school system of about 50 years before. BECKER: Okay. LAMB: So. BECKER: I see. Geoffrey B. Lamb November 19, 2007-Final Edited 3 Now, did growing up in and being educated in South Africa influence your later career and, if so, how? LAMB: Oh, hugely I think because it-it-I mean, I was in some sense, still am, but certainly was a very political animal. As far as I was concerned, I cared about South Africa and its future, and I cared about Africa and its future. I was growing up at that time in the era of African independence, essentially, which, you know, I was very excited and hopeful about. Of course, South Africa was the exception, or the outlier, for many years. so I always felt fundamentally focused on Africa in the first place, and then on development questions from a-from a personal point of view. BECKER: So you studied developmental economics, which was a new field then, I guess. LAMB: Yeah. Well, actually when I went to Sussex, which is where I went to .. BECKER: Right. ·LAMB: .. when I went to the U.K., I did an MAin African Studies, which was a-basically a combination of political science and economics at that time. And then I went on and did aD Phil, at Sussex. Of course, it's a PhD for some reason. It-but that was actually in political science. BECKER: I see. LAMB: My thesis, although it was a kind of political economy-type work, was in the faculty of political science. BECKER: What was subject of the thesis? LAMB: The thesis was a field study of coffee cooperatives BECKER: Oh. LAMB: .. and their interaction with politics in Kenya. BECKER: Kenya. Okay. LAMB: And I did field work in Kenya in the late 1960s . BECKER: I see. Geoffrey B. Lamb November 19, 2007-Final Edited 4 LAMB: .. and wrote the thesis and then that afterwards became a book. [Lamb, Geoffrey, and Linda Muller. Peasant Politics. London and New York: Julian Friedman, Ltd., and St. Martin's Press, 1974.] BECKER: Now, if I may back up a little bit, what did your-your family do in South Africa? Your father? LAMB: My father was an assayer on the gold mines, which is-he's the guy who was in charge of testing the purity of different samples of ore or rock so that the mine would make decisions about where to-where to drill, or where to-where to mine. So he was a kind of-I guess you would say in the mine hierarchy, he was a sort of middle management sort of person. And we moved around to several mines around the Johannesburg region . BECKER: I see. LAMB: .. when I was growing up. That's part of the reason that I went to boarding school, because he was working in a fairly remote BECKER: Part of the ... LAMB: .. part of the country BECKER: I see. LAMB: .. at that time. BECKER: The reason I asked that question is because every once in a while, you find someone whose family was really quite interested in developmental Issues. LAMB: Pretty remote in the case of my family. BECKER: Pretty remote. Okay. Okay. LAMB: Yeah. BECKER: Now, you said you worked as a journalist for a while. LAMB: Yes. BECKER: Where was that, and what did you write about? LAMB: When I left the-when I finished my B.A. at Witwatersrand, I was-I Geoffrey B. Lamb November 19, 2007-Final Edited 5 became a trainee reporter with The Star, which was then an afternoon paper, the biggest afternoon-the biggest-actually, it was the biggest daily newspaper in South Africa. So I was a kind of cub reporter. And so I did everything from sports to the crime beat, to-but ironically during that time, I was also the junior reporter on Nelson Mandela's trial, the Rivonia Trial BECKER: Oh. LAMB: .. which was going on at that time. So that was the sort of big piece of political reporting that I did. BECKER: Oh. LAMB: I did actually support myself, partly, at graduate level in London and Sussex, by working as what in England is known as a sub-editor. In this country, it would be called a copy editor. BECKER: Mm-hmm. LAMB: And I think I had the distinction of being the only person who has worked simultaneous-because I was doing this part time-on The Sunday Telegraph, which is very right wing . BECKER: Yes. LAMB: .. conservative newspaper, and The Daily Worker, which was a communist newspaper. So I was a journeyman in-you know, irrespective of ideology. BECKER: Right. ·Well, editing is editing regardless of. LAMB: Mm-hmm. BECKER: .. as you say, of the ideology. In your undergraduate education, or your graduate education, were there professors or fellow students who you see as having been very influential in your later career? LAMB: The-at the undergraduate level there was a very famous political science professor who rejoiced in the name of Godfrey Hugh Lance lot LeMay, and who afterwards became the-whatever-the head of Worcester College in Oxford. He went back to Oxford, and he was a political theorist and a very good one actually, and he was also-what was intriguing was he was a distant Geoffrey B. Lamb November 19, 2007-Final Edited 6 relative of General Curtis "Bomb Them Back to the Stone Age" .. BECKER: Oh, LeMay. LAMB: .. LeMay .. BECKER: That LeMay. Oh. LAMB: .. of the Strategic Air Command here. So he had a sort of a fund of stories about that, so he was a-he was a kind of iconic figure. At graduate level at Sussex there were-there were three, and won't go into the detail, but one was the guy who was my DPhil supervisor, a very fine political scientist called Colin Leys. Another person who really got me interested in sort of institutions and organizational theory and, in a sense public choice economics, although he was a political science professor, called Bernard Schaffer, who is now deceased. And then the-the big sort of-l mean, in a way patron figure for me was a very distinguished economist called Sir Dudley Seers, who was one of the pioneers of development economics and, in fact, introduced me-oddly enough, got me to be part of the Sussex and IDS-Institute of Development Studies-team that had a joint project with the World Bank's research people that first brought me into contact with the Bank. BECKER: I see. That was kind of my other . LAMB: Yeah. Yeah. BECKER: .. I see-you know, other question. LAMB: So-but Dudley was a great-! mean, almost a father figure, but certainly a great patron and-and kind of encourager to me, and very influential on me. BECKER: Mm-hmm. Now he's not the one-this Colin Leys is the one that directed the .. LAMB: He was-he was . LAMB: .. thesis on Kenya? Geoffrey B. Lamb November 19, 2007-Final Edited 7 LAMB: .. yeah, he was my supervisor on Kenya. BECKER: I see. LAMB: But Dudley was-Dudley was the head of the Institute of Development Studies at the time. BECKER: I see. LAMB: And I was a graduate student attached there. BECKER: Now after receiving your degree, you started an academic career. LAMB: Mm-hmm. BECKER: And where was that? LAMB: Well, while I was still working on my degree, I became a research officer at a place called the Royal Institute of Public Administration. I needed a job. I needed to support myself while I was writing my DPhil dissertation. So that was a research job, in which I was the junior author on-of an immensely tedious book about the, you know, the inner workings of an aspect of British government, and then, just around the time I was completing my DPhil the'sis, I became research fellow in the School of ·African and Asian Studies at Sussex. And I was just there for about-in that role-for about a year, I think, and then became a fellow of the Institute of Development Studies in Sussex. BECKER: And you did some consulting in addition to that? LAMB: Yep. Yes. Over that time, particularly once I was at IDS, I consulted for the ILO [International Labour Organization] and UNDP [United Nations Development Programme]. And then, after a little while, from about '74 or so onwards, I would consult fairly regularly for the World Bank. BECKER: On what-what were the subjects that you ... ? LAMB: It was when-it was a period in-in the Bank when the Bank was just getting interested in the issues of institutions and political economy, having sort of-was coming out of the-its more purist economic and project finance background. And so the then-chief economist, Hollis [B.] Chenery-he was McNamara's Geoffrey B. Lamb November 19, 2007-Fina/ Edited 8 adviser, as you know-was beginning to encourage a somewhat more multi- disciplinary or more institutionally and politically oriented sort of analysis, initially on the research side. So I-I was asked to, you know, to participate in that in one way or another. BECKER: Now, how did-or did this lead to eventually joining the Bank, or was there a different route? LAMB: I suppose that-1 mean that played a role, because BECKER: Yeah. LAMB: .. people by then knew me, and I knew some of the characters and got more interested in the work, and so on. But l-and there-at the end of the 1970s, Hollis-Hollis would come through London, or come through Sussex every, you know, a couple of times a year. We'd normally have dinner, or have a drink or-and talk about stuff. And he would sort of ritually say, "Oh, it's time you came and spent some time at the Bank. Why don't you come to the Bank?" And-and I was rather other focused at that time. And then, for a variety of personal reasons, I wanted to take a break from Sussex, and when Hollis came through, I said, "I might be interested," and he said, "Well, write to me if you are," which I did. BECKER: I see. So this is 1979 or ... LAMB: This was '79. BECKER: Yeah. LAMB: .. yes, that I-that I dropped him a line. I think it was in the autumn of '79, and he and the then-director, John [H.] "Jack" Dulay of what was then called the Development Research Center, which was the equivalent of DEC [Development Economics] today-rough equivalent-got back to me and said, you know, come over for-come over and give a seminar; come over and give some-get some-you know, talk to people, and so on. And we agreed, I know, sometime early in 1980, that I would come to the Bank. BECKER: Okay. Now, did you join the Young Professionals Program? Geoffrey B. Lamb November 19, 2007-Final Edited 9 LAMB: No. I did not. BECKER: You ... LAMB: I was already old rather than young. BECKER: Okay. Well, you were also a professional by then. LAMB: I guess. I guess. I would-so I was-I don't know what I was-34 or 3 5, or thereabouts I guess. BECKER: Mm-hmm. So you were a little older than the . LAMB: Older than-I think it was then-I think the cutoff then was 30. BECKER: Yeah. LAMB: I think they afterwards raised it to 3 2 or thereabouts. So no, I didn't. I came initially on a two-year assignment because I thought I was going back to Britain, and going back to Sussex. BECKER: Mm-hmm. LAMB: So I asked for a fixed-term appointment and then, as often happens with Bank people . BECKER: Right. LAMB: .. things change. BECKER: Right. Now, specifically, then, what did you work on for those first two years? LAMB: When I first came, my job was to help the-they were very-I don't know what you'd call them-very pointy-headed economists in the research center. They were very modeling oriented, very theoretical. And they were working on a bunch of issues around what had been called distribution with growth." So they were-it was an attempt to think about the distributive consequences of different growth paths, and my job was to help them think through-and then we were going to get a research project underway, possibly, to think through how one could rigorously incorporate some of these institutional and Geoffrey B. Lamb November 19, 2007-Final Edited 10 political economy aspects into the growth modeling. 'And I did that-we did-we did some work on the political economy of irrigation water in Pakistan, I remember. We did some work on the pattern of Korean growth. There were two or three sort of big topics like this, and the idea was could we evolve a methodology that would enable one to look at this systematically across the board. And there were methodological difficulties, but the irony was that very shortly after I arrived, MeN amara announced . BECKER: Right. The last-he was leaving. LAMB: .. that he was going to leave. BECKER: Right. LAMB: Hollis announced that he was going to leave with McNamara, and the new regime, to put it mildly, was not very interested in issues of redistribution. This was also, of course, the change to the [Ronald W.] Reagan era, and Anne [0.] Krueger came in as the chief economist and basically kicked over all the furniture, and so there was much less interest in that-in that sort of thing. And, in fact, a number of people on the research side left. I had, meantime, been asked-so it was kind of less clear in my case, I had been asked to be a member of the World Development Report team for 1983. And so I was working, I think, either half or two-thirds of my time on that anyway when all of these tumultuous changes were happening in the Bank's leadership, and also in the research wing. BECKER: So-but you were asked to stay, or you asked to stay? LAMB: No, I was asked. I was asked very early on by Hollis and Jack Duloy, because he said, you know, we need to have more-the way they put it was more "non-standard economists" in the place. I didn't even-I was hired as an economist. That was my title. I didn't even particularly think of myself as an economist. I thought of myself more as a political scientist, if anything. BECKER: Right. LAMB: So-and by that time, you know, other things had happened at a personal level which made that seem more appealing. BECKER: Desirable. Geoffrey B. Lamb November 19, 2007-Final Edited 11 LAMB: Yeah. BECKER: Okay. LAMB: So I agreed. I can't remember. I think that happened-! think that happened within the first year I was BECKER: I see. LAMB: .. I was at the Bank. BECKER: So you worked then-that would have been '82, '83 LAMB: Mm-hmm. BECKER: .. you were working on the World Development Report? LAMB: Yes. BECKER: And what did you do after that? LAMB:· Oh, at sort of-sometime around in there, I also moved-although I was still working on the WDR-I moved my organizational base, as it were, my departmental base, from the research center to what was then called the Projects Advisory Staff-which became the Projects Policy Department in 1983-which was central advisory group, and in it they had set up the Public Sector Management Unit headed by a guy called Arturo [P .] Israel. I feel that more and more as one gets older, one says, you know, "who is unfortunately now deceased .. " BECKER: Yeah. LAMB: .. but who was, you know, who was a-who was very much a pioneer on institutional work in the Bank. And so I went to work with him in this small group of, I don't know, four or five people. BECKER: Mm-hmm. Now this-this clearly, under [Alden Winship "Tom"] Clausen and Anne Krueger, was not exactly the Bank's central focus. LAMB: No. Indeed not. Geoffrey B. Lamb November 19, 2007-Final Edited 12 BECKER: So you were either left alone or harassed. LAMB: Yes, in my case, it was a bit-it was-it was either a bit of both or neither. I'm not quite sure how to characterize it, because I was at that time the, you know, very much the thrust, or the cutting edge, of the Bank was the whole structural adjustment . BECKER: Right. Right. LAMB: .. lending and so on, which I was very interested in, and-and was actually rather sympathetic to because I felt that, particularly for Sub- Saharan, Africa I was, you know, I was aware of some of the-I had written a little paper, I remember. when I was. still in the research center about the- I wish I could find it. It was done for a Bank study [Accelerated Development in Sub-Saharan Africa: An Agenda for Action. Washington, D.C.: The World Bank, 1981.] on Sub-Saharan Africa generally known as the "Berg Report." It would be a laugh to read it now .and see how silly it was or-or otherwise-but about the pathology of the African state. And essentially, I mean, I think-! don't think it was as commonplace then as it is now-talked about the weakness of the institutions and political structures, and, therefore, the tendency towards what we would now call kleptocracy, or using the state just to extract rather than using the state to organize and run the society. BECKER: It's a very fashionable idea now. LAMB: It's a very fashionable idea now. I think-! think it was-it was certainly less fashionable and-and maybe even-even less known then. So I was interested in how one would get a better state, as it were, a less extractive or less kleptocratic state, and I thought-at that time, I thought the-the structural adjustment stuff, although I didn't agree with all of it, and I thought it was very apolitical or, you know, un-political in its thinking. BECKER: A-institutional? LAMB: Exactly. Exactly. But I thought that it was an interesting thing to try to reorient countries along the right line. So I actually did some work on the policy management side of adjustment programs, about how one should think about economic policy, not just as a kind of "this is what you do to the exchange rate; this is what you do to the state enterprise," or whatever, but how you actually manage that, what institutions you needed, and who should our counterparts be in countries. Who should we work with, and what should we-how should we help them in order to manage these processes as political processes and administrative processes, not just economic edicts. And that- ! was actually hunting in my-what passes for my records for a copy of that. Geoffrey B. Lamb November 19, 2007-Final Edited 13 That was sort of Bank Working Paper [World Bank Discussion Paper No. 14: Managing Economic Policy Change: Institutional Dimensions. Washington, D.C.: The World Bank, 1987 .] And ironically, because, if anything, I certainly then was perceived in the Bank as very much left of center, or left of the prevailing wisdom, this was seized on by a number of kind of radical and NGO [non-governmental organizations] writers as evidence of, you know, the Bank's fiendish plot to control the world and control the politics of African countries. BECKER: Yes. LAMB: And so, it was an irony, an irony. BECKER: Now, how was it received in the Bank or LAMB: It was received in the following way: number one, quite a lot of the sort of younger economists and people leading adjustment work in Africa thought that it was very helpful, and I was asked to go on a lot of adjustment miSSIOnS . . BECKER: I see. LAMB: .. and so on because it somehow resonated with the, you know, the conditions they found, of sort of broadly incapable governments with maybe a small group of reformers, and how did you support them, and how did you make this more broadly owned and-which was kind of what I was arguing. I don't remember the detail, frankly. But-so they-quite a few people sort of responded very positively and said this is the sort of approach we need and so on, so I started working on quite a lot of adjustment programs-African adjustment programs and one or two others. The-I think-Anne Krueger and her, you know, her people who were working for her were sort of not at all interested, so, I mean, sort of, you know, some other research paper from some weirdo. BECKER: Right. LAMB: I mean, I got on perfectly well with Anne. Actually, she and I traveled to China together to go and give some seminars about the World Development Report after it came out. And personally I got on quite well, and we had sort of some entertaining arguments in Shanghai guest houses and so on, but I don't think she-she didn't pay any attention to it, I think. BECKER: And, clearly, this wasn't Clausen's interest at all. Geoffrey B. Lamb November 19, 2007-Final Edited 14 LAMB: No. 1-well, Clausen-Clausen was the only president of the World Bank over the period that I was associated with the Bank whom I never actually spoke to, I never actually met. He was a very remote .. BECKER: Remote. I see. LAMB: .. figure, I think. BECKER: Okay. I'm going to ask you later about the presidents . LAMB: Yeah, yeah, yeah. BECKER: .. in any case. Now-so what happens after this in your Bank career? You're in thi 's PAS [Projects Advisory Staff] area. LAMB: Yes. But then-it was then, you know, the Bank keeps on changing .. BECKER: I know. LAMB: .. these acronyms. I can't remember what-it was then turned into the Projects Policy Department . BECKER: Oh, okay. LAMB: .. and became under a guy called [Visvnathan] Rajagopalan, who was the department director, and [S.] Shahid Husain became the boss, or the vice president in charge of all of this kind of policy. So there was the Country Policy Department and the Projects Policy Department. And then there were some other bits that I can't remember. So I was in the Projects Policy Department by now as an adviser on public sector management through until 1987. So that would be about '83 to '87, or '82 to '87. BECKER: So-and is this where you worked on African .. LAMB: I worked a lot on .. BECKER: .. issues again? Geoffrey B. Lamb November 19, 2007-Final Edited 15 LAMB: .. Africa at that time. I worked, I think-if I think back, I worked on Kenya, Uganda, Tanzania a bit, Zambia a bit, Ghana a lot, Gambia, Sierra Leone. That may be it. BECKER: Okay. LAMB: So, at least half a dozen, a half dozen to eight. BECKER: Okay. And then also Pakistan and India? LAMB: Pakistan and India to some extent. Thailand quite a lot. Johannes [F.] Linn got me in-that was also around '83, or whatever-again on the Thai structural adjustment process, Johannes had, partly as a result of this paper .. BECKER: I see. LAMB: .. got me involved in the Thailand work, and I worked, oh, for about two years on and off. I was quite-two to three years, I was quite involved in Thailand. BECKER: Mm-hmm. I did a long interview with Linn. It's a really a very .. LAMB: Oh, right. BECKER: .. interesting . LAMB: Right. Yeah. BECKER: .. a very interesting interview. Now, were you posted to any of these places? LAMB: No. No. BECKER: Or you worked from here, and they . LAMB: I worked from here. I traveled-for somebody who wasn't in, you know, a Regional operation, well, I traveled an awful lot over that-over the '80s, particularly. BECKER: Okay. Now what happens in-well, two questions: what happened to you in '87, and what happened to the Bank in '87? Geoffrey B. Lamb November 19, 2007-Final Edited 16 LAMB: Ah. BECKER: Are those two connected? I mean ... LAMB: Well, I guess they are connected. I mean, as you well know, the Bank reorganization was announced by shortly after Conable came on board, and a number of people whom I knew were involved as kind of movers and shakers of that process, like Shahid [Javed] Burki, and Caio [K.] Koch-Weser and others. I was not sort of personally involved in it in that very early on- and I can't remember why this should have been-but very early on it was made clear that the entity that I was in, was-I mean, it was going to be changed and called something else, of course, and-but that the stuff that we were working on, on public sector management and institutional stuff, was absolutely, you know, core stuff and, therefore, there was no problem and nobody was, you know ... So, from a personal point of view, I felt, you know, relaxed. I thought it was a very, very important, and I think, in retrospect, a very bad moment for the Bank, because I-I mean, I'm sure many people have talked about this and there's a range of views, but I think it's interesting wheh institutions-and the need to change or the desire to change-make the misstep of in some sense fundamentally breaking trust. And I felt that that thing where everybody was sort of, you know . BECKER: Fired. LAMB: .. thrown in-fired and had to be re-hired and so on, I think that affected people in a very profound way that probably they didn't even realize at the time, and that not only affected people, it affected the way people regarded the Bank, and, you know, afterwards, some years afterwards, when I was in charge of trust funds and things like that, and, therefore, getting very anxious about issues of corruption and issues of proper fiduciary stewardship and so on, I was always, you know-1 suppose in a sense, I was nai've or something, but I was always shocked that there would be any Bank staff who would feel so disconnected from the mission, or disconnected from the institution that they would get involved in this. And I may be wrong, but I felt that that moment in '87 was somehow an important inflection point in that. And so ... BECKER: In the literature of large American corporations, there's-there are people interested in that question of the disconnect once benefits that have been promised, that pensions in particular .. Geoffrey B. Lamb November 19, 2007-Final Edited 17 LAMB: Yeah, yeah, yeah. BECKER: .. are first of all adjusted, and then eventually done away with. LAMB: Right. BECKER: And that's been absolutely devastating to LAMB: Mm-hmm. BECKER: There's no way of getting it back when . LAMB: Yeah. BECKER: .. people just don't trust the people who are making these decisions. LAMB: Well-and maybe it was a bit analogous to that in the Bank, and I suppose exacerbated, I mean, you know, the whole thing about the-you know, the G-4 visa and the golden cage and all of that. I mean, it has the-it has this negative connotation of people being very comfortable and holding on to that comfort, and being much better off here than they might be back in their own countries, and all of that. But at the same time, there is an extraordinary vulnerability. If people have wives and children .. BECKER: Sure. LAMB: .. and, you know, houses and everything, and then they are suddenly 29 days away from being without entitlement to live here. So I think it-I think that was pretty important. I think so. BECKER: Now, what happened to you? LAMB: Ah, well ... BECKER: '87 is a year that you're . LAMB: Yes. Well, in the-in that year, I was sort of wondering whether I ought to-I've been doing all_ this work on Africa and on some other countries as well. I was wondering whether I ought to sort of jump into the operational side of the Bank. That was then all sort of slightly put on hold by the reorganization. You remember there was this period of six months or so when all the pieces were being moved around and everything was frozen and so on, and I-I, in the end, felt a bit impatient about all of that Geoffrey B. Lamb November 19, 2007-Final Edited 18 And then I was asked by Alex [Alexander] Shakow, who was the new head of a new department of strategic planning and review [Strategic Planning and Review Department] whether I would come and work for him. And his-the spiel he gave was, you know, we need to have people who've got a different optic on, you know, who are both insiders but also outsiders who aren't-who are prepared to take a kind of broader view about what the Bank's role is, and think about, you know, unusual new directions, and so on. And it, I mean, it was just very tempting. BECKER: Mm-hmm. LAMB: So I ... BECKER: Now, had you known him before? LAMB: I had known him-I had not known him until Alex joined the sort of parallel department, the country policy department [Policy Planning and Program Review Department] as a senior adviser [special policy adviser] or something. I think he'd been at US AID [United States Agency for International Development]. I had not known him at all. BECKER: Mm-hmm. LAMB: But over the-some-you know, during that time in the '80s, when we would be having these internal arguments about adjustment, about the role of institutions, about political economy, I mean, there was quite a lot of intellectual ferment, I would say for Shahid Husain that he did encourage a certain amount. You know, there'd be seminars and arguments and review meetings and that sort of thing. And Alex was one of the people who would say, yeah, we've got to take account of this stuff. Whereas, the more sort of hard-nosed the Armeane [M.] Choksi of the world would say, "Oh, bullshit to all of those .. " BECKER: Yeah. LAMB: .. you know, "these countries have just got to pull up their socks and do what we tell them" sort of thing. So there was an interesting de bate. And so I'd got to know Alex, but not terribly well. So, it was slightly out of the blue that he approached me and asked me [inaudible]. BECKER: So what then was your responsibility? LAMB: I was called the adviser, and Alex was the boss. There were a Geoffrey B. Lamb November 19, 2007-Final Edited 19 couple of divisions. Michael [F.] Carter was the head of the International [Economic] Relations Division, something which dealt with the UN and, you know, the other multi laterals, and with the Fund, actually, to some extent. And then the Strategic Planning [Division] group-a guy called Francisco [R.] Sagasti was brought in as the division chief. And I was made the adviser. So Sagasti was brought in by [W.] David Hopper, who was the new senior vice president in charge of this and a number of other things-Senior Vice President for Policy [Planning] and Research. So, I was the adviser, and I worked in that role. It was a rather peculiar role, because strategic planning is not-is not-I don't know-the Bank does not take well to this-and it was interesting because it was a job that brought me in relatively close connection with Conable and Conable's office, because he was interested in using it as a sort of change agent. BECKER: Mm-hmm. LAMB: The-at that time, there were basically no topics on which Moeen [A.] Qureshi and Ernie [Ernest] Stern agreed except on the need to squash the strategic planning as quickly and as thoroughly as possible. [Laughter] So, it was an interesting time from that point of view. BECKER: Mm-hmm. LAMB: And so, you know, we did the usual strategic planning stuff that one does of scenarios and all of that kind of thing. I don't know how much traction that had. But the interesting thing for me was that we sort of identified a few what we call strategic topics, which would then go and talk to Conable and say, look, you know, if you agree that these are interesting, we '11 do some more work on them, and, you know, not as part of a whole integrated strategic plan, but just somebody needs to be thinking about these .. BECKER: Right. LAMB: and there's nowhere else in the organization where it's being done. BECKER: Right. What kind of issues were they? LAMB: Well-and there was-I remember there was a youngish economist Geoffrey B. Lamb November 19, 2007-Fina/ Edited 20 there who-I'm trying to remember the-more of the content now-but he was doing work on what would nowadays be called innovative financing mechanisms. So, he was pushing the idea of guarantees, of using the Bank more for its guarantee power than for its direct-its direct lending. That, in those times, was a pretty revolutionary idea. I think the Bank might have done-you know, of course, originally the Bank had been thought of as a guarantor . BECKER: Guarantee. Right. LAMB: .. of bond markets and so on, but that's not the way it had gone. So he was sort of resuscitating that and doing some work on that, and Conable was interested in that, although cautious. And I was put in charge, or I had proposed and then was put in charge of looking much more closely at the Bank's role in Eastern Europe. BECKER: Oh. LAMB: And then, you know, in very quiet brackets, and the Soviet Union. BECKER: Mm-hmm. LAMB: This was, you know, '87 .. BECKER: '87. LAMB: .. '88. BECKER: Right. LAMB: One could sort of start to see currents, you know, of [Mikhail S.] Gorbachev. I think came here in '87 or '88, I can't quite remember. So, you know, the question was, was this all going to open up? Should there be a role for the Bank? If so, what we had at that time, I guess, Romania and Yugoslavia and Hungary were already members of the Bank, and-but in a rather sort of peculiar role, a peculiar status. And so I was asked-and I think it was '8 8, '89-to put together a small group of people who do a very quiet report for the president on the Bank's role in Eastern Europe, which we did, and some people like Cheryl [M.] Gray-Cheryl Gray was then a young professional-worked on that. I can't remember all of the other members of-from-dredge them up. Anyway, we did a report, which I gave to Conable; sat and sort of talked him through with him and Marianne Haug, and that-and so that-I think that had some influence in the internal discussion. Geoffrey B. Lamb November 19, 1007-Final Edited 21 But, of course, in parallel, there were these much bigger movements going on that ended up with the joint study of the Soviet economy, with the Bank and Fund doing that [International Monetary Fund, The World Bank, Organisation for Economic Co-operation and Development, European Bank for Reconstruction and Development. The Economy of the USSR. Washington: D.C. 1990]. But they were doing this big study, and that was all being very carefully monitored, obviously, by the U.S. and others who were sort of interested but nervous, and by this time, my senior vice president was a man called Wilfried [P.] Thalwitz, whom you would know of. And Wilfried sort of designated me as his go-for on these questions. And Ernie Stern, who was by then the Senior Vice President- Finance, having been switched into that by Conable, designated Jean-Fran<;:ois Rischard as his go-for. So Jean- Fran<;:ois and I would have a sort of rather careful dance. We got on well personally, but we were always sort of positioning ourselves BECKER: Yes. LAMB: .. on behalf of our bosses in this BECKER: I bet it ... LAMB: .. developing drama. Okay. Okay. So, yeah. So that's what I did for about the-and then at the- in '89, '90-I 'm just trying to remember exactly when-Wilfried was going over to resume charge as the vice president in charge of what was now Europe and Central Asia. And he said to me, "You better come and run some of this institutional and political stuff in the ECA Region." So I moved, I think, in 1990 to the Region. BECKER: I see. Now, you moved there. LAMB: Yes. BECKER: So, were you based . LAMB: Oh, no, I didn't move to the country. I moved to the office. BECKER: The office. Okay. LAMB: The office. The office. The office. BECKER: Okay. LAMB: And I mostly worked on Russia, obviously-Russia, Ukraine, Belarus, Poland, Albania, Romania during that time. But I then had to get Geoffrey B. Lamb November 19, 2007-Final Edited 22 together a team working on public sector management in the transition countries, so we put together a team, which I was in charge of, of about, I don't know, 10, 12 people who worked on that. BECKER: And-what was the focus? LAMB: The focus was how are these countries going to make the transition to a new form of government and state and public management from the ol and to accompany the great changes in economic policy and obviously the politics .. BECKER: Politics, oh. LAMB: .. that were happening. So, we were-we tried as much as possible to regard ourselves as, you know, technicians of this process, although it was obviously profoundly political. BECKER: Mm-hmm. LAMB: So, for example-and it's sort of funny to think back on it now-in a number of the countries, one of the jobs of my group was to go in and help the ministry of economy or the ministry of finance, as the case may be, set up what the first time that they had had an external finance division of, you know, of the treasury, of the ministry of finance, because all of their external finance had been Warsaw Pact . BECKER: Right. LAMB: .. transfers and that sort of-so they had no clue, and then all of a sudden here are all these aid programs and loan programs and, you know, things going on, and how were they going to organize and deal with it? And so we put in a number of entities where partly-when I think back, we were- you know, we were recreating sort of bad old aid management divisions that many of us were familiar with, but I managed to get a few people from OECD ministries of finance, and so-who knew about external finance and public debt management, you know, external debt management and that sort of thing, to help with organizing these offices. BECKER: Now there ... LAMB: That's just an example. BECKER: The receptiveness on the part of these various countries must have varied depending on .. Geoffrey B. Lamb November 19, 2007-Final Edited 23 LAMB: A lot. BECKER: .. you know . LAMB: A lot. Yes. BECKER: Okay. What were the key variables and the variations? LAMB: There was one axis of variation which was essentially Russia and all the rest, because Russia obviously-the Russian officials were-there was a combination of being fundamentally really resentful about the loss of great power status, so being pushed around, or even having to talk to, you know, these people annoyed the hell out of them. So, they were not easy to deal with from that point of view. And many of the people that I and my team had to deal with were people who were quite deep in the apparatus. You know, they weren't the sort of-they weren't the people who were kind of fronting up to the international conferences and so on. They were the people who were running the machinery of government essentially, so ... BECKER: The agencies and the ... LAMB: That's right, and the ministries, and, you know, and in some case they were completely unreconstructed and were, you know, as I say, quite annoyed about the whole process. So that was different in Russia from the others. In some of the other countries, for example, certainly Ukraine and Belarus, you had people who were, you know, long-time functionaries who were just- who might have been suspicious and so on, but they were not angry in the same way, and they were just kind of clueless about the new world and sort of stumbling trying to walk, but stumbling. So that was a difference. Of course, what we only gradually realized, or, well, actually quite quickly realized was that in these countries the existing apparatus was sort of imploding from within, and that what was actually happening was an amazing sort of grab for resources and grab for, you know, as sort of cowboy privatization going on, because there were-there were now no norms about the nature of state property, proper procedures, who owned what and so on, so there was just an extraordinary freedom. BECKER: Now, did the Bank become involved in this? Or-this was quite contentious, if I recall. Geoffrey B. Lqmb November 19, 2007-Final Edited 24 LAMB: It was very contentious. The Bank did become involved, because the Bank had been a big promoter of the privatization process, and particularly in Russia. And Bank people-there were really two schools within the Bank, and it got quite heated within the Bank, I remember, between the people who said, you know, you're transforming a whole system. You've just got to let everything go. The quicker the better. Big bang. Let it happen. And that, I guess, effectively was the dominant view in among people working particularly on privatization. ·There were a group of us, and I think I was part of them, who was saying actually this, you know, this is going to turn out badly. And we have to try and have some reform-oriented stability in the system to hold the ring, to have an orderly transition, and there were a number of people who were working there who had done some work on China, for example and, you know, the Chinese situation was not comparable because in China the state was not falling apart. BECKER: Right. LAMB: Quite the opposite. BECKER: You were working with the state? LAMB: That's right. Whereas in Russia and others, you could say, well, who are you exactly working with? What is the political base of the government? So it was different. But that was kind of coming to a head around '93, '94 when the Y eltsin government started to seriously put itself in hock to the industrialists. [End Tape 1, Side A] [Begin Tape 2, Side A] BECKER: Sure. LAMB: So I think this debate was coming to a head in '93, '94. I remember we did at one point-partly some people in the Russia country division [Europe and Central Asia Region Country Department III, Country Operations Division II] and partly some of my people-and I was involved-did a big country study-a country economic memorandum on Russia, which raised some of these issues about the constitutional base of the government and about the borderline between public and private property, and the need to clarify that and to have an orderly process, etcetera. And I-I would-it was-I mean, I was getting fairly sort of annoyed and burned out after having Geoffrey B. Lamb November 19, 2007-Final Edited 25 done this for three-plus years, but with, you know, huge amounts of travel sort of every few weeks back and forth. But we had a big review meeting, which I recall was chaired by the guy who was then the country director for Russia, Yukon Huang, at which everybody sort of said their piece. I think I was-I think I led the discussion because I think I was nominally the-in charge of that report; I can't really remember. And in which the meeting very firmly said, yeah, actually we do have to take this seriously. Things are getting out of control, and the Bank should be- make a very clear stand, and Yukon at the end of the meeting said, "Fine, okay. This report is not going into gray cover," and "I had this discussion, and that's the end of it." I mean, he basically just .. BECKER: Shut it down. LAMB: .. shut it down. And . BECKER: Why'd he do that? LAMB: I don't know. I should-! would not be surprised if at that point not only within the Bank, but certainly within the U.S. government and maybe within the G-7, the thought was, you know, we are backing Yeltsin. Whatever Yeltsin needs to do, what Yeltsin needs to do, we're in favor of. We do not want to have a lot of kibitzing from the Bretton Woods institutions. The Fund, if anything, was stronger on the, if you like, conservative side in saying you got to have some order here. There are these sort of outrageous things being done in the fiscal accounts, and so on. And the Fund, I think, was shut up as well. BECKER: Mm-hmm. LAMB: But I don't-odd to think of now. I didn't really know what the politics were. BECKER: Yeah. LAMB: I didn't really understand. BECKER: Now this would be '93? LAMB: '93 .. Geoffrey B. Lamb November 19, 2007-Fina/ Edil.ed 26 BECKER: Maybe '94. LAMB: .. going into '94. And so I-that was-I mean, I don't want to overstate its importance, because I was also kind of annoyed with all the travel, and I had young children and, you know, there were all sorts of other things that were sort of push factors, but I felt quite-! mean I had-I suppose I had always felt about the Bank that, you know, I believed in, you know, you have to have policy. Everybody has to sign on to the policy and all the rest of it, but that there was very vigorous internal debate, and that in the end, there was a respect for that. And this seemed so nakedly at variance with that, because it wasn't, you know, a lot of the people who were in the country department were saying, you know, we really need to take this seriously; a lot of, you know, a lot of serious people inside and outside the actual Russia operation, and it was just kind of "this is not convenient" and pushed aside. So it certainly-it certainly did not-it certainly did not make me feel that I wanted to hang in there. BECKER: Now, did you get the sense that the Bank might have concluded that it was more than it could handle? LAMB: It may well have been. That may well have been part of the BECKER: Game. LAMB: .. this was a very big game. BECKER: Yeah. LAMB: So, I'm not sure that the Bank would be that influential, you know, if some body gets the chance to, you know, grab 10 or 15 percent of G D P. You know, in a country like Russia, they're unlikely to-I remember a friend of mine having-who-a very close friend, an economist who worked on Russia, who afterwards left the Bank and went into the private sector, saying that he'd gone to deliver some message to the energy minister, I think it was, about what the Bank wanted to see in the privatization of the then-potential privatization of GASPROM. And this guy sort of looked at him and said, "We're going to privatize," you know, "the energy industry." And this guy, Paolo, had had to say, you know, "We're not sure that we can proceed with this loan if ... "-you know, the usual stuff, and this guy said, "When we do, we're going to be bigger than Exxon. Do you seriously think I'm going to listen to the World Bank for the sake of a $500 million loan?" And Paolo said he walked out and he thought, "You know, that sounds right. That sounds about right." Geoffrey B. Lamb November 19, 2007-Fina/ Edited 27 BECKER: Yeah. Yeah. [Laughter] LAMB: It was a funny moment. So we had some moments like that, I guess. It was a bigger game. BECKER: Now what-so you're getting burned out. LAMB: Yeah. BECKER: .. and . LAMB: Yeah, so I'm probably slightly exaggerating that, but I . BECKER: [Inaudible] LAMB: .. yeah, whatever. I was certainly . BECKER: You [inaudible] back and forth. LAMB: .. very tired . BECKER: Tired. LAMB: .. and missing my children. BECKER: Yeah. Okay. So, did you initiate a move, or was the . LAMB: No, again-again, I mean, I must seem a completely feckless individual because when I think about it, pretty much all of the jobs that I've had, unlike-except for my first academic job, people have suggested to me. So I haven't had a great . BECKER: Yeah. LAMB: .. career plan. You know, people have come along and suggested things, and they've seemed appealing at the time. So I was-again the same man, Alex Shakow, who had asked me to join the strategic planning group [Strategic Planning and Review Department], suddenly phoned me, very much out of the blue. He was by then-he was at Geoffrey B. Lamb November 19, 2007-Final Edited 28 this point I think the director for External Affairs in the Bank, and he called me and said, "The Bank has been looking for"-this was in early '94-"The Bank has been looking for somebody credible to be the head of the office in London." And I said, "Yeah, but," you know, "that's an administrative post." And he said, "No, the point is ... "-this was the-it was the 50th anniversary of the Bank. BECKER: Right. LAMB: And the "50 Years Is Enough" campaign was getting going. And he said, "Now let's have lunch or something." And we arranged to meet and he explained that the Bank was being pilloried; that London was regarded as the center of it because of Oxfam BECKER: Oxfam. LAMB: .. and Christian Aid and so on, but also because theFT [Financial Times], the BBC, The Economist, you know, the sort of global media that paid attention to development issues . BECKER: Was there. LAMB: .. were in London. And, you know, would I consider it. And I sort of thought about it, and went home and talked to my partner. She is- although she was born in Washington, D.C., she's basically English. BECKER: Oh. LAMB: She was then working-she is-once more, but she was then working at the Fund, and we sort of thought about it, and thought, "Well, possibly," and so I went back and said, "Well, possibly." And really before I knew it, I was ushered into Lew [Lewis T.] Preston's office, and, I mean, he was extremely nice to me, but-and was not, you know, making me an offer I couldn't refuse, but talked about how when he'd been in London, when he had young children, and he'd so enjoyed it, and he really felt that most people in the Bank didn't get it about the external political environment, that he thought that it was a huge, you know, a huge issue, a huge problem. And, you know, we really needed somebody who would just be-l mean the line was-and, you know, people were no doubt flattering me and some, but the line was, it'll do us no good at all to send aPR person there. So we need to send somebody who's got operational exposure, who can handle the intellectual argument and will be credible, and be seen as credible, by the media. Geoffrey B. Lamb November 19, 2007-Fina/ Edited 29 BECKER: Also, someone who's a little-had a reputation of having been a little left of center, too. LAMB: Yes. Yes, right, because I had the IDS [Institute of Development Studies] background . BECKER: Right. LAMB: .. and so on. So I guess that played a role and must have [inaudible]. So, again for some, you know, for some combination of reasons, we decided to go. My partner was [inaudible] put out feelers and so on, was asked to become a senior adviser at the Bank of England. BECKER: Mm-hmm. LAMB: And so that all kind of worked from a personal point of view. Our daughters were then pretty young, sort of six and four, and we thought it would be nice, and they'd be close to grandparents and so on, so we decided to do it. BECKER: Mm-hmm. LAMB: And a number of friends said, you know, what a stupid thing to do. You're going to go and be a flack and out of the running and, you know, off the ladder, and so on and so forth. So it was regarded . BECKER: And being a target also. LAMB: That's right. That's right. Well, I have to tell you, on my first day walking into New Zealand House-the Bank's office-which is just off Trafalgar Square, I walked into the office, went up to the 15th floor, sort of said hello to-I had met them before, of course, but the assistants who were there-and you could look out and see Nelson's Column, and my assistant, Lisa, said, "Look over there." And overnight, somebody, not connected to me, but it happened to be my first day, a mountaineer had shinnied up . BECKER: Oh. LAMB: .. Nelson's Column and dropped a banner the full length of it, which said "50 Years Is Enough." BECKER: Is enough. Geoffrey B. Lamb November 19, 2007-Final Edited 30 [Laughter] LAMB: So that was my welcome to the job. It was quite funny. BECKER: Well, how did you strategize to deal with this? Let me ask, was there-before you left for London, was there a strategy within the Bank? Did Preston's office, or some other-one of the other vice presidents take charge of how to deal with this? LAMB: The truth was-and I think I've got the timing right-just that summer, I, in the end, went to London in the middle of the year, sort of July-July, August, and just around that time, Alex Shakow was pushed out of being the director of External Affairs because the way that the Bank, you know, dealt with the severity of the "50 Years Is Enough," the critical challenge, was, as many large organizations do, which is to decide that-to shoot the messenger. And so Alex was pushed out. It was all his fault. You know, everything would be fine except our PR operation had been defective. BECKER: Yeah. LAMB: So, I mean, you can see what I thought of that, but as it happened, they brought in a guy called Mark Malloch Brown, who happened to be a close friend of mine. I mean, I didn't know that Mark was in the running until fairly late in the game. But when he called me and said, "Look, I'm thinking about this, and they look like they're going to offer it, and," you know, "I know you know the Bank," and-because Mark had worked in Russia .. BECKER: Right. LAMB: .. and on Russia, and I had met him that way, and got very friendly with him and his family. So, Mark was coming in just in the summer, or late summer, of '94, when I was just going to London and-so, no, I mean, he then did come up with a strategy, but as far as my job was concerned, he just said, you know, I know you know how to handle yourself. You'll do what-you know, tell me what you need and just go and do it. And which is essentially how we worked. BECKER: So, what did you decide then had to be done? LAMB: Well, I decided that there were-that there was the two elements, and then a subsidiary one. l-and again, you know, maybe this was Geoffrey B. Lamb November 19, 2007-Final Edited 31 excessively realpolitik on my part, but it was a view that I've continued to hold. I thought that, in the end, while one needs to be open and accessible and ready to debate and so on with NGOs-the key NGOs-we were never ever going to persuade them of the virtue of our ways because they were structurally opposed. That was what they-they thought differently, and also it was not in their interest to say, "Oh, gosh, actually the World Bank is doing quite a good job .. " BECKER: Let's work with them. LAMB: .. under the circumstances." Yeah. So, I thought that that, you know, one needed to be open and so on, but that was a waste of time for thinking if you have 45 meetings with NGOs you're going to change anything. So my core strategy was twofold: One was to decide to really to get close to and be regarded as reliable and so and by the major establishment media, essentially-BBC, [The] Economist, FT, and the-and, you know, to a degree The Guardian and The Times-you know, the British media, but especially the ones with global reach. BECKER: Right. LAMB: I was most focused on those, and to be regarded as not just a mouthpiece, but somebody who they would turn to when they needed to find out what the real deal was. BECKER: The Bank's point of view. LAMB: The Bank's point of view, but also if they wanted, you know, unvarnished information. So, my incautiousness sort of paid off in the sense that because I would be indiscreet occasionally, people thought I would-you know, he's not just managing .. BECKER: A flack. Yeah, yeah. LAMB: .. [inaudible]. So, I focused a lot on that, and I did have-my partner, as it happened, had been a journalist on The Economist and The Times years before, so we had lots of friends in that world and, therefore, it was relatively easy to, you know, to become more friendly and get closer to people. And the other thing that I did was to focus very much on the U.K. Treasury, and, say, you know, I'm prepared to help. You know, I can help you in Geoffrey B. Lamb November 19, 2007-Fina/ Edited 32 dealing with the fact that .. BECKER: This issue. These issues. LAMB: .. with these issues, and the fact that, you know, the chancellor has to get up in Parliament and defend why he's, you know, supporting these Bretton Woods institutions and so on; that we could take some of the load ourselves, which they found politically attractive. But that was also the period-' 94-' 95-when the G-7 was just starting to get interested in development issues one way or another, and so-and the Bank- the Bank had traditionally thought the G-7 was something that went over there and talked about exchange rates, and sometimes the IMF seemed to be interested in that. But the-you know, the prevailing view of the Bank-I mean, it's weird to think about it now-the prevailing view in the Bank-I remember Armeane Choksi was the vice president then. I was talking to Armeane and saying, you know, "I really think we need to devote a lot more attention to what's going on in the G-7," and he said, "It's completely irrelevant, and you're wasting your time doing it." And, you know-and that was-I mean, this is a very smart, sophisticated guy, but that was the view. So, I spent a lot of time kind of cultivating the U.K. sherpa-financial and economic sherpa-in the U.K. Treasury, and sort of talking to him about, you know, global economic issues, what the Bank's take on it was, wasn't this something for a broader conversation, and so on and so forth. And that worked out very well because the U.K. very much wanted more of a sort of a development dimension, even though this was still the Tory government. They were keen on broadening the G-7 agenda. And they, therefore, found it useful to sort of back channel with the Bank about some of these issues, and sort of even raised things that they might be raising in G-7 meetings, and so on and so forth. So, it was fun for me, because I was a kind of funneled to Preston and then, in due course, to Wolfensohn on, you know, on some of these issues, when you would have thought, well, they should have been doing it in Washington, but they weren't. So that was don't think anybody anticipated that. That was kind of happenstance, and I, you know, I seized it, or I grabbed it and-I mean, it was more interesting to me to be talking about policy than- you know, with these guys than just sort of as we're representing the Bank. BECKER: Right. Mm-hmm. Now, when this term ended, which was m '97 ... ? Geoffrey B. Lamb November 19, 2007-Final Edited 33 LAMB: Just at the beginning of '97. Yeah. BECKER: How did that-well, how did that end? How did you move on? LAMB: It ended-well, I moved on. This was a bit of a sort of, I don't know, a fumble or a stumble or something. It ended because essentially the Fund said to my partner-we'd been away just over two years-about two- and-she carne a little bit after me, so she'd been-she was just corning up to the two-year mark in the autumn of '96. And the Fund-she was a sort of high-rising person in the Fund, and they basically said you've got to fish or cut bait. BECKER: Mrn-hrnrn. LAMB: You can't extend leave of absence for-I think they-I think they gave her to the spring or something. And so we sort of hemmed and hawed. I mean the-she could have certainly stayed at the Bank of England, which was sort of okay, but only okay, or she could have gone into the private sector, into the markets in London. And I can't exactly remember why, but we decided that, you know, that . BECKER: I see. LAMB: .. that actually we were going to come back. I didn't particularly have a job. I mean, it wasn't unlike the pattern that I mentioned to you. BECKER: Yes, right. LAMB: It wasn't that somebody was saying why don't you come and do X? BECKER: Mrn-hrnrn. LAMB: So we decided to come back. And I let Mark Malloch Brown know that, you know, we need to come back because of Caroline's job. And, of course, the irony of that is that we carne back, and Larry [Lawrence H.] Summers called her and said, you know, "I need you to come and work in the U.S. Treasury." BECKER: Oh, she went there. LAMB: So, she went off to a-she went off to the Treasury, and which, you know, so that would have been-and also a powerful reason to come back. Geoffrey B. Lamb November 19, 2007-Final Edited 34 BECKER: Now, when-while over there, Wolfensohn takes over in June of '9 5. LAMB: That's right. Yes. BECKER: Had you known him before? LAMB: I had met him once at some conference or whatever, so I sort of-I knew him, but he didn't know me. I mean, I-we 'd spent half an hour talking about the Third World debt or something at some conference several years before, and I'd remember him because I just thought he was exceptionally smart .. BECKER: Yeah. LAMB: .. and he was then a boutique merchant banker, but he seemed to know everything, so I had been impressed. But when I was in London in early '95, when Jim was appointed, but hadn't yet taken office, he let me-or his people let me know that he was coming to London. You know, he's got lots of British connections. BECKER: Right. LAMB: And I called him up and said, you know, even though you're not the president yet, I really think you should take the opportunity, and I'll organize for you to, you know, see a bunch of people who will be helpful and that you need to know once you're president, and so on. So I was an early-! was one of the earliest staff members to experience the Wolfensohn event. BECKER: I see. LAMB: So-but it was actually fine. I mean he came, and I-he knew John Major already from some previous incarnation, but I took him to see Tony Blair, who was then the leader of the opposition, and I introduced him to Gordon Brown, you know, I mean, so-and he saw-and then we went to, you know, we went the government round, but I also introduced him to a number of other people, and had a lunch for him with some city people and journalists and so on, which, you know, etcetera, so, yeah. So ... BECKER: But he focused on the criticisms rather heavily. Geoffrey B. Lamb November 19, 2007-Final Edited 35 LAMB: Yes. Yes, he did. BECKER: So, did you take him to the NGOs or . LAMB: We did. We had-in that initial time, I mean Jim came several times when I was there, two or three times when I was in London, but that initial time I think we got in Oxfam and Christian Aid and World Vision and-we got in four or five of-and it was fine because he-I mean, Jim is very skillful at, you know, sort of being a kind of I'm-on-your-side guy. BECKER: Mm-hmm. LAMB: So, he handled it well, and they obviously-they didn't sort of start ranting at him or anything. I mean, it was just a kind of interested, you know, we heard when you take office, you will change the following sort of thing. And it was pretty useful, I thought. BECKER: I suspect his view, though, of the NGOs was very similar to your view of the NGOs, which was that you could go just so far with them. LAMB: Yes, I could never make up my mind with Jim, because partly Jim's-you know, Jim has a deep appreciation of Jim's talents, and so . BECKER: I interviewed him, and we spent four long interviews, so LAMB: Oh, okay. So you know him very thoroughly. BECKER: Well, I .. LAMB: Yeah. Yeah. Well, you know, Jim has got a huge ego, so Jim-part of what-part of it is that he's very realistic about assessing these things, but partly Jim feels he can charm any bird out of any tree. And, you know, I mean, I think he's got some hundreds of millions of dollars that says he's broadly right. BECKER: Yes. LAMB: But, you know, so I think part of him was always feeling, you know, if only I could get these bloody Bank idiots to behave properly and do what I tell them and have the right instincts, we could do this. BECKER: Yes. LAMB: So I think part of him felt that way. Geoffrey B. Lamb November 19, 2007-Final Edited 36 BECKER: Okay. LAMB: He was perhaps a little less-he was more hopeful than I was. BECKER: Well, I'm not speaking out of school, but my sense was that maybe towards the end, what I'm reflecting is what his end view was rather .. LAMB: Yeah. BECKER: .. than his earlier . LAMB: Maybe that's .. BECKER: .. his earlier . LAMB: .. right. That's a good point. BECKER: .. you know, his earlier view that-because I asked him to reflect on that. LAMB: Right. BECKER: And I think his reflection reflects your earlier view . LAMB: Right. Right. BECKER: .. that ultimately there is a disjuncture that, you know, even charming as he is . LAMB: Yeah. BECKER: .. you know, skillful and persuasive, it wasn't possible to bridge these .. LAMB: Right. Well, I-well, that's a good point, you know, and I mean sort of leaping ahead chronologically, when I was running the IDA [International Development Association] replenishment, and Jim was .. BECKER: Yeah. LAMB: .. you know, Jim was my boss. In fact, I was reporting directly to him then, and he'd say, you know, we've done all the debt cancellation. Geoffrey B. Lamb November 19, 2007-Final Edited 37 We'd done all these different things and so on, and I had spent an awful lot of time with the NGOs on the need for a bigger IDA replenishment, and I remember having a conversation with him when, you know, I said, you know, we put all this in, and you put all this in, and, you know, they're not doing anything for us up on the Hill or anywhere else. They just won't speak up for IDA at all. And he was absolutely furious. I remember, you know, those ungrateful [inaudible]. BECKER: Yes. LAMB: You can imagine . BECKER: Yes. LAMB: .. the expletives. So I think he had come to that view, quite frankly. BECKER: Okay. Well, I deflected the conversation from .. LAMB: Sure. BECKER: .. your coming back. LAMB: Oh, right. Yeah. So I came back without a job, strictly speaking. BECKER: Yes. LAMB: And I came back-and, you know, I was made senior adviser in the External Affairs Department. I mean they said, you know, "You come back, you can stay in External Affairs," although Mark knew perfectly well I would not do that. But, you know, I needed some nominal job, at any rate. And the-I guess at that point there'd been yet another mini-reorganization ... BECKER: I was going to ask you about that. Well, actually, there was one that Wolfensohn started . LAMB: Right. BECKER: .. when he-I guess it gets started even-started talking about it before he got to the Bank . LAMB: Yeah. BECKER: .. but I think it's '95 or '96 . Geoffrey B. Lamb November 19, 2007-Final Edited 38 LAMB: '96. Yes. BECKER: .. that that's underway. LAMB: Yes. I guess that's right. And, to be honest, I, you know, I was a little remote from it, so ... BECKER: Okay. I was going to ask what your role, if you had any role in it, or .. LAMB: No, I remember going to, you know, various sort of focus groups and meetings, but l-it seemed a little-this was sort of before formation of the networks and .. BECKER: Yes, right. LAMB: .. and all of that. BECKER: Right. LAMB: I was not closely involved. BECKER: Okay. LAMB: But when I came back, it-I had been talked to, to come and be the head of the Public [Sector] Management Group in what I guess was already then called PREM [Poverty Reduction and Economic Management]. Is that right? Yeah, PREM. BECKER: Yeah. LAMB: And that was kind of interesting because-and this was in the early months of 1997, I guess just after I'd come back, and I was doing stuff in External Affairs, but that was obviously just marking time. And that was the only time when I had a real setback in the Bank, actually, because the guy who was running PREM, who very much wanted me to come-! had the sort of credentials, in terms of the kind of work that I had done before. And that-and I was blocked on that . BECKER: Oh, really? LAMB: .. yeah, you know, by somebody senior. I was very, very, very annoyed about that. And I remember barging into Jim's office and sort of Geoffrey B. Lamb November 19, 2007-Final Edited 39 yelling at him about that. I mean, I suppose I was lucky in that (a), I could get into his office; and (b), he didn't sort of fire me on the spot. BECKER: Right, for yelling at him, right? LAMB: Yeah, but he didn't-! don't know what-1 don't know what, if anything, he did. He sort of said oh well, this is, you know, it's all the process, and I'm sure it'll all work out and, you know, and so on. But I was pretty annoyed about that. So ... BECKER: So you were in this . LAMB: I was in ... BECKER: .. office for, it couldn't have been more than a year? LAMB: It was about nine months. It was about eight months. BECKER: Yes, as late as ... LAMB: It seemed a very long time. BECKER: Okay. Oh. LAMB: It seemed a very long time, because, you know, I mean, I like being active. I like being engaged, and, you know, so it was perfectly okay. BECKER: Mm-hmm. LAMB: But it didn't seem that real. BECKER: Well, how is it then that you take on-l had your resume, and it's confusing frankly .. LAMB: Yeah, I became-okay. BECKER: .. in '97 because . LAMB: Okay. BECKER: .. I had you down as taking on a post of-was it director of the Trust Funds .. LAMB: The Trust Funds and Cofinancing Department. Geoffrey B. Lamb November 19, 2007-Fina/ Edited 40 BECKER: .. and Cofinancing? Okay. LAMB: Yeah. BECKER: It was called-it's called both T[E]FC and TFO LAMB: Right. BECKER: .. so LAMB: Yes, it had been called the Trust Funds Office. BECKER: Yes, I see. LAMB: And somewhere during 1997, I don't know whether this was kind of a late bit of the broader reorganization . BECKER: Mm-hmm. LAMB: .. it was re-structured as a department. BECKER: I see. Okay. LAMB: So there was a vice presidency, which traditionally had a Japanese vice president, and there were three departments-the FRM, Resource . BECKER: Right. LAMB: .. Mobilization [Department]-the IDA department, essentially, this Trust Funds and Co financing Department now, and then there was a third group [Project Finance and Guarantees Department]. I don't think it was called a department, run by Nina. [B.] Shapiro, which was on guarantees and .. BECKER: Yeah. LAMB: .. which was doing sort of guarantee-the guarantee business having, you know, now . BECKER: Taken off. LAMB: .. taken off to some extent. So there were these three groups under this vice president. Geoffrey B. Lamb November 19, 2007-Fina/ Edited 41 BECKER: Okay. LAMB: And when that-when the TFO was changed into TFC [Trust Funds and Cofinancing Department], into a department, I think what-if I recall, the guy who had been, you know, the equivalent of a division chief or something of this TFO was told that he would not get the job, and that they were going to compete the directorship. And I'm trying to remember who told me that I should put in for it. Oh, I know who it was. It was Sven Sandstrom. BECKER: Uh-huh. Okay. LAMB: Sven said, "You should put in for this," and I said, you know, "The trust fund and all this finance stuff is kind of boring." And he said, "No, you'll turn it into something else." And so I, you know, I thought, well, okay, it's a management job. It's a director-level job. It seems to, you know, deal a lot with donors. I certainly understand about the donor world through my time in London and so on, so let's see. And the other thing that was appealing about it was that, of course, this was just when the Asian financial crisis was getting going. BECKER: Yes, I was going to ask about that, yeah. LAMB: Yeah. And the more that I saw that developing, I thought, you know, the Bank is going to need to do some things too, in a non-standard way, to help manage this crisis. And I remember in the interview with the then-vice president, Hi roo Fukui, saying to him, you know, I think-it was in the summer, I guess-! think trade lines are going to start growing-drying up. I think these countries are going to find they can't get money, and-even for very short-term purposes, and we should be thinking, can the Bank mobilize those? Can the Bank mobilize co-financiers to do that? And he was very nervous and said, "Well, I don't know. This is now remit. That's not what we traditionally have done." And, I said, you know, "It's an idea. We ought to think about it." And so I sort of got in-1 got interested in it because I was interested in, you know, what was happening in the world, what the Bank's role should be, and so forth. So ... BECKER: Okay. !-we've gone an hour and half. Geoffrey B. Lamb November 19, 2007-Final Edited 42 LAMB: Okay. BECKER: Would you like to take a break for about half an hour? LAMB: Sure. Sure. [End Tape 2, Side A] [End of session] Geoffrey B. Lamb November I 9, 2007-Final Edited 43 Session 2 November 19, 2007 Washington, D.C. [Begin Tape 3, Side A] BECKER: This is the second session with Geoffrey Lamb. This is Bill Becker. It's November 19th, 2007, and we're at World Bank headquarters in Washington, D.C. Good to see you again. LAMB: Yep. BECKER: Before our very brief break, we were talking of-about the move you made from being a senior adviser in External Relations to become the director of the TEFC . LAMB: Right. BECKER: .. earlier, the TFO. LAMB: Right. BECKER: And you were talking a bit about the connection that in taking this job, that you saw the opportunities to deal with some of the issues that arose out of the 1997 Asian-Southeast Asian financial crisis. LAMB: Right. BECKER: And I'd like you, if you wouldn't mind, please, take up where we left off. LAMB: Right. Well, you know, first I think a confession is in order, that 1-partly I was interested, obviously, in the unfolding crisis and what the Bank should do about it. I also had a narrower personal interest, which is that, quite candidly, quite a lot of the sort of trust fund supervision and so on job that I had then taken over seemed pretty tedious to me. It wasn't something that was going to engage me that much. And so, in part, I was being a little bit maybe aggressive or something, and saying okay, if you've got th,is base in this department with these functions involving co-financing and bringing financial parties together and so on, what else could you do with it in this context? So there was a self interest, but then also a broader interest. Geoffrey B. Lamb November 19, 2007-Final Edited 44 And so I-I' d-1 think it's fair to say I didn't really have many of the right people. There were some smart people working in the department. I managed to call on some other people, especially in the East Asian Region, who wanted to think a little bit outside the box, to use the cliche, about how the Bank should respond. And so we had, I guess, what you would now call a virtual group of people who were trying to think, you know, will we need to do something about trade finance? What should we do about trying to organize donor countries in circumstances where these are mostly recipient countries which are now not conventional aid recipients, but which may need to become recipients because of-because of the systemic crisis? So, partly as the result of that, I got involved-! was asked to go to Korea in late '97, I guess that was, in November-December '97, where the Bank was coming back into lending to Korea because of-because of its liquidity problems. And I went on-1 went on a structural adjustment mission to Korea to help design that loan, and also sort of figure out what needed to be done within the ministry of finance in Korea, which had been very successful along a certain track, to make sure that it could handle this much more volatile situation. I suppose over the years I'd sort of acquired a little bit of experience in, you know, how ministries of finance organized themselves, and again to go back to our earlier conversation, how they deal with external BECKER: Right. LAMB: .. 1ssues. And so I spent quite a bit of time on that in the Korea case. Now, I think it's fair to say that, you know, that the near-term urgency of financing and including of things like trade lines was abating a bit by early '98. I mean, by that time the U.S. Treasury and others had begun to respond a bit more, so even though the Korean-the Korean elections were held at just the turn of the year, as I recall-even though all of this was still very urgent, it wasn't quite as if everything was drying up in these countries, and so the longer-term structural issues were becoming more important. But nevertheless, I suppose, you know, from-from my point of view, the good thing was that, you know, that my department, having been, I think candidly, regarded as a bit of a backwater, was now part of the discussion and part of the action. And I came to work quite closely with Sven Sandstrom, Geoffrey B. Lamb November 19, 2007-Final Edited 45 who was then a managing director-one of the managing directors on these, you know, on these-on these issues through 1998. BECKER: Mm-hmm. Did you work with the IMF on this? LAMB: A little. But, for the most part, the relations with the Fund were handled by the Region, by-particularly by the East Asia Region, and also the Latin America Region, when the contagion spread to them. So I didn't have much to do. I did work a bit with PDR-Policy Development and Review-in the Fund on some of the financing issues, but not that much. BECKER: Okay. I mean some of the literature suggests there was a great deal of tension between the Bank and the Fund . LAMB: There was, yes. BECKER: .. over the way the Fund had handled the initial response to the crisis. LAMB: Yes. Yes. It-oddly, you know, going back to you characterizing it correctly as broadly left of center, I'm-I tend to be very conservative on financial and fiscal issues, so, you know, to the point of being, you know, accused of being an IMF agent inside the [Bank?] .. BECKER: I see. LAMB: .. because I remember having a furious argument with Joe [Joseph E.] Stiglitz about Thailand, where he said that the Fund was-I mean Joe and I get on very well, personally-but he said that the Fund, you know, committed a great error in getting the Thais to cut expenditure and cut their budget when their economy-when their economy was in free fall, and it precipitated a recession and so on. And, you know, my response to that was well, so the policy prescription here is that when your currency is tanking and nobody wants to touch it, the Stiglitz prescription would be to expand the money supply. BECKER: Oh, yeah. LAMB: Is that your-you know, is that really what we're arguing? That's really-you're advising them. Joe would say-we had a great maybe dog row, which unfortunately was in-not in public, but was in a larger-a larger gathering. So there was-there was a lot of internal tension. I think, in the Geoffrey B. Lamb November 19, 2007-Final Edited 46 end, it got-it got more contentious, almost, on Indonesia than on . BECKER: Yeah. LAMB: .. than on Thailand . BECKER: Yeah. LAMB: .. partly because Thailand sort of happened earlier, and it got pretty bitter. BECKER: Well, Indonesia was a much more serious problem. I lived in Singapore at the time . LAMB: Oh, did you? BECKER: .. so .. LAMB: Oh, right. BECKER: .. and so . LAMB: Yeah. BECKER: The Singapore press covered Singapore very badly LAMB: Yes. BECKER: .. but it covers Malaysia and Indonesia just very, very well. LAMB: Very well. Oh, I can imagine, yes. BECKER: And so we were able to follow very, very closely what was going on .. LAMB: Right. BECKER: .. there. And Indonesia was-1 mean, the problems there were much larger than, you know, than in other places. LAMB: Right. Sure. Sure. BECKER: Thailand is a-you know, it turned itself around a little more quickly. Geoffrey B. Lamb November 19, 2007-Final Edited 47 LAMB: Yeah. And I think, arguably, in Indonesia-! mean I'd have to sort of go back and think about it a little bit-this stuff again, but, arguably, in Indonesia that the Fund did actually make more of a mistake . BECKER: Yes. LAMB: .. in the sort of bank closures . BECKER: Yes, exactly. LAMB: .. preemptive bank closures. I think they were right on the macro stuff in Thailand, and they were wrong on the financial sector stuff. BECKER: And even bad banks make loans to small businesses . LAMB: That's right. BECKER: .. and that's what-1 guess it was Jeffrey Sachs made that criticism of, you know, Indonesia. LAMB: Yeah. BECKER: So you didn't stay long, though, at the Trust . LAMB: I didn't stay long. BECKER: .. when you moved to . LAMB: The reason . BECKER: Oh. LAMB: .. yeah, the reason for that was that the woman who was running FRM was herself actually living in Singapore at the time. BECKER: Oh, really? Oh. LAMB: Yes, because her husband, who worked for the Fund, was heading up a sort of regional office of the Fund in Singapore. And so she was kind of running the-I guess the last stages of the IDA 12 replenishment, sort of at long distance, but that clearly wasn't sustainable. And so she was going to- she was going to leave that position and become a Bank representative in East Asia or something. And so the job became open. And Sven said to me that I Geoffrey B. Lamb November 19, 2007-Final Edited 48 should throw my hat into the ring. At the same time, actually, it was-I can't quite remember the sequence-at the same time, my Japanese boss announced that he was going to leave, and he left, and there was then quite a long hiatus before his successor arrived, so I was also asked to be acting vice president. So I-you know, so, I mean, I thought the IDA stuff is incomparably more interesting and important. It's about poor countries, which I care most about, rather than middle-income countries, and it's hugely about Africa, so that seemed to me to be-to be a very obvious thing to go for. BECKER: Now, I meant to ask when we were talking about the Trust Funds, so how large an office is this that you were in charge of? LAMB: The Trust Funds group then was about 30 or 35 people. BECKER: Mm-hmm. LAMB: About 35 people. BECKER: And you said the work was tedious. I wanted to just ask, have the issues over the way the finances of the trust funds been solved by the time you got there, or were you involved in dealing with some of the issues? LAMB: It was-it was the issues around-around corruption and so on were just beginning to surface a bit when I was there. BECKER: I see. LAMB: And this had been-I think it's fair to say this had been-well, actually I remember that, years before, I remember being in a meeting with Ernie Stern. I can't even remember why I was in it, because I was more junior than would normally-normally be in that meeting. But I remember Ernie Stern saying, "We've got to shut down these goddamned trust funds," you know, "they're a nuisance. There were all sorts of special conditions. Donors are looking over our shoulder, and the game just isn't worth it." And, you know, the next time I looked at it, which was when I was about to become the-you know, it had grown and grown like Topsy. BECKER: Yeah. LAMB: So I think this was always a problematic area because it was essentially the Bank being given-being told by donors, "No, no, we really want you to do this .. " Geoffrey B. Lamb November 19, 2007-Final Edited 49 BECKER: Yeah. LAMB: .. the Bank then becoming, like any junkie, dependent on the fix. And, you know, and feeling well, this is a way to enlarge our scope, and sometimes to get extra budget and so on. So it had become-it had become quite a big deal, but always sort of slightly sub rosa, slightly-nobody really wanted to look at it too much because it was all out of the standard way of operating, and so on. So it was this kind of uncomfortable-and I was trying to do some sort of modernization [inaudible] systems. We started having much more policy- oriented regular meetings across the table, annual meetings with the major trust fund donors, where we would sort of say, well, okay, what are you trying to do? What are your policy priorities? Is this trust fund structured right? and then getting into, you know, the housekeeping, with agreements and fund management and so on. So I had started to that, and sort of felt there was some slightly sloppy things about it, but it was basically, I guess it was about a year or 18 months after I left when this scandal about these individuals .. BECKER: Right. LAMB: .. having rigged these consultant trust funds really broke-really broke into the open. BECKER: Okay. I got the dates wrong. I thought it was earlier than that. So it was after ... LAMB: No, I mean, I remembe was trying to remember the sequence, and I remember-! remember being in a hotel room in Japan on some, you know, trust fund trip, and getting a question from Jim Wolfensohn, which!- which was couched as if it was a trust fund matter, but it was actually about the issue of Bank staff discretion over sole-source procurement, you know, about the-the limits beneath which you could do sole-source procuring BECKER: Right. LAMB: .. of consultants. And, of course, it was linked to the trust fund stuff because, as it turned out, these guys-these guys who were cheating on the consultant trust funds were breaking up contracts to remain below that level in order to keep parsing them out to their-to their buddies. But I remember sort of being in Tokyo and sitting down and thinking God, Geoffrey B. Lamb November 19, 2007-Final Edited 50 you know, dredging back into my operational past for-and then writing a note to Jim explaining this and saying to him, you know, I'm really-! remember-! mean, it was interesting because, you know, as it turns out, these funny things, I was glad that I had done it saying, you know, I think there's a real governance problem here, because especially when we're using consultant trust funds, and you've got these quite high limits, there's really in practice no oversight over this because the Regional managers are supposed to, but for them, it's just additional budget . BECKER: Yeah. LAMB: .. so they don't care. And the central trust fund folks had no way of actually checking what's happening out in, you know, country X or country Y with these things. They're just-sort of doesn't meet the nominal criteria- oh, yes, okay. Sign off. So I wrote a note to Jim because he'd asked me, and I remember when this scandal passed out, sitting down and talking to the investigators, and them saying, you know, saying to me nobody had ever raised this. You know, nobody had ever raised a concern about this. This-you know, how come, you know. I was able to say actually . BECKER: Well, I had; yeah. LAMB: .. actually, you know, one had, but-but, I mean, I had to say, I was completely flabbergasted. Two of these guys-one of the guys or two of the guys-I don't remember now-were actually in my department. I mean, they were working there, and they were obviously doing that-well, they'd been doing it before I came. And I had no inkling at all .. BECKER: Yeah. LAMB: .. other than the general system seemed to be questionable. But . . . BECKER: Now-so you moved over to LAMB: FRM. BECKER: FRM. LAMB: Yeah. BECKER: And you were also the acting-the acting vice president. Geoffrey B. Lamb November 19, 2007-Final Edited 51 LAMB: Yes. BECKER: Now did-when you took this job, did you-were you unhappy with, had you thought much about the way the IDA-previous IDA replenishments had gone? I mean, did you have a sort of an agenda of your own, since you were interested in the question? LAMB: Yeah. Yeah. I think that what I-what I thought and-and I think it came from my experience in London and-and in External Affairs, frankly, what I thought was that the IDA-the IDA replenishments historically, especially when Ernie ran them, were run in a very Bank-centric and frankly authoritarian way. You know, Ernie would be in charge. There would be some, you know, satraps who were running around doing the papers, and so on. You know, Ernie would dragoon all of the donors. There would be a certain amount of pushing back about how much money they were prepared to put in. Ernie would say what was on the agenda, and that will be that. And that model, I felt, was still sort of in the mind of the people running the replenishments. You know, that's how it should be. BECKER: Mm-hmm. LAMB: And I felt the world had really changed, and that, you know, we were in-we were in a context where, you know, the U.S. in particular-the [Robert E.] Ruben-Summers Treasury, even though, you know, friends of mine and so on, were being very hardnosed with the Bank. And the G-7 was being collectively hard-nosed, in the sense of well, yes, these things are all very important, and development's all very important, but that doesn't mean we're going to cough up any money. So there was this sort of disconnect between the prominence of the issue and what they-and so I felt that we needed a much more sort of forward leaning, in a way much more political, process of sort of pulling people in and-and this was also just the time when the whole debt forgiveness bandwagon was really starting to roll, which-well, Jim Wolfensohn saw very quickly. And, you know, but-but we were coming up to a point where the initial HPIC [Heavily Indebted Poor Countries] that Jim had got underway was being seen to deliver almost nothing. So there was a lot of pressure for a much bigger thing building, including within the G-7. And, you know, I-I mean, I saw pretty early on-I wasn't-! wasn't alone in seeing this; I'm not claiming huge prescience or anything-but I saw that the impact on IDA of the debt forgiveness debate was going to be huge. BECKER: Mm-hmm. Geoffrey B. Lamb November 19, 2007-Final Edited 52 LAMB: And so we had to get out there and get into the mix in a much more proactive way. Whereas, the-I sort of think my predecessors had sort of taken the traditional view, which I think is of as the early view that, you know, the less these people know, the better. And I didn't think that was going to work any longer. BECKER: Mm-hmm. LAMB: So I don't think I had more of an agenda other than to feel that we had to be much more forward leaning, much more getting out there and discussing and trying to find allies among the donors, trying to just-trying to construct coalitions that would, you know, would give more, you know, more reliable strength to IDA. BECKER: Mm-hmm. Did you face-you'd mentioned earlier that you had talked to the NGOs about IDA. Was there much resistance still to LAMB: I think at .. BECKER: .. among the NGOs? LAMB: .. at this point, I mean, Jim had had a certain amount of success. At this point-this is-this is '99 one's talking about now, early '99-the NGOs, as far as I recall, were almost totally focused on debt relief. BECKER: Mm-hmm. LAMB: And this was when the so-called enhanced HIPC discussions were gathering force within-including within the G-7, culminating in September of '99, when the enhanced HIPC thing was sort of rolled out. So-and, you know, so one had to engage with the NGOs on the issue of debt relief. Again, as I said, being a financial conservative, I'm much less of a believer in debt relief as a panacea for all ills than was the public discourse, including by the president of the World Bank. So I was in some difficulty, obviously, on this issue. But, you know, we had to engage on that. BECKER: Mm-hmm. LAMB: And in-and during '99, actually just as I was sort of taking over as director of FRM, we were plunged right into the enhanced HIPC, you know, Geoffrey B. Lamb November 19, 2007-Final Edited 53 the expanded HIPC program, and debate and meetings in the Board, and so on. And a kind of interesting thing happened because that there was a HIPC unit, which was doing all that stuff, and doing all the debt sustainability analyses, and so on. But the center of gravity switched towards the issue of how do you finance debt relief, and what impact is it going to have on the IMF's finances, on the Bank's finances? and so on, and so I was in the hot seat-on-on that. And that's pretty much how it stayed, really. BECKER: So, I mean, the tensions over this were not alleviated, or relieved, or ... LAMB: The-there were-there were severe tensions between the Bank, particularly, and the G-7 over-over paying for the debt relief. BECKER: Mm-hmm. LAMB: And-it's funny. I mean this-we had kind of deja vu a couple of years later with the G-7 second debt forgiveness thing in 2006. So-2005, 2006-so the key thing was that the G-7 wanted to declare victory, and then say, you know, the Bank's got plenty of money to take care of this. And the Bank and Fund launched a pretty strong sort of counter-argument, to say actually if you do that, it will-you know, it will threaten to-not-it probably did say it will bankrupt IDA. BECKER: Mm-hmm. LAMB: That was an exaggeration. But it will severely impair IDA's .. BECKER: IDA. LAMB: .. finances. And the Fund was saying the same about its-about the PRGF [Poverty Reduction and Growth Facility], or whatever the PRGF was called then [Enhanced Structural Adjustment Facility]. So there was a big sort of counter-argument by the institutions, and that got pretty tense. The- and the whole issue about-and so I spent, I and some of my colleagues spent, you know, from the spring of '99 through the autumn and the Annual Meetings, you know, having to fly off all around the world to G-7 sherpas- secret G-7 sherpas meetings, mainly to be bawled out . BECKER: Yeah. LAMB: .. and sworn out by the G-7. [Laughter] But, you know, to try and come and hold the line, and come up with a solution. · Geoffrey B. Lamb November 19, 2007-Final Edited 54 So it was-that-my-my recollection, at le.ast for people like me, was that the tension was much more with the G-7 than with the NGOs. The NGOs were just saying, you know, forgive everything and we don't care and, you know, the Bank must get on with it. BECKER: Right. Now, this is IDA 13. LAMB: This was still-this was just after the conclusion of IDA 12. BECKER: Twelve. I see. Okay. LAMB: So there was IDA-I mean, the sequence in terms of these big negotiations was IDA 12, which was being finalized by my predecessor, Paula [Donovan], and then the debt-the enhanced HIPC thing was the big deal. And then the negotiations for IDA 13 began in 2000, I guess. I might be getting slightly muddled up about the timing. BECKER: Okay. Because then there-! have, let's see, IDA 14, which you do vice president, was under your . LAMB: Yes. BECKER: .. auspices? LAMB: Yes. BECKER: Well, we'll get to that. LAMB: Okay. BECKER: I'm interested in how that grew as much as it did LAMB: Right. BECKER: .. and how that came about. LAMB: Right. Right. Right. BECKER: Now what else were your responsibilities? I have down that you had the, you know, the GEF, the Global Environmental or Environment . LAMB: Yes. Geoffrey B. Lamb November 19, 2007-Final Edited 55 BECKER: .. Facility? LAMB: Yes, which I never paid much attention to. BECKER: I see. LAMB: I mean, what happened, to be-to be candid, the GEF historically had been-had been something that the successive Japanese vice presidents of this office had paid particular attention to. And, as far as I was concerned, you know, if that's-if that's what the success of-my successive bosses wanted to do, I was fine with that. BECKER: Mm-hmm. LAMB: It was small in relation to IDA. BECKER: Yeah. LAMB: The senior management of the Bank frankly cared less about the GEF, but were very focused on IDA, for various reasons. And so I basically devoted my-pretty much my full time to IDA, and very little to the GEF. BECKER: Okay. Now, there was a-while you were-how long were you the acting vice president? I mean, did they eventually-they eventually got someone? LAMB: I think it was-yeah, they eventually got Motoo Kusakabe, who came-l guess it was about six or seven months . BECKER: I see. ~AMB: .. something like that . BECKER: I see. LAMB: .. because I think Fukui left in the summer of-the summer of '99. BECKER: Okay. LAMB: And, Kusakabe was appointed in January. BECKER: Now, in 2003, you move on to become the Vice President for Resource Mobilization and Cofinancing. Geoffrey B. Lamb November 19, 2007-Final Edited 56 LAMB: Yeah. Yeah. BECKER: First of all, how old was that vice presidency? Or-I tried to figure that out. I wasn't ... ., ~ ~ ' I ~ ~ Cl.l C'l..l~ - .,..;....'-.::; ~ a =~ C'l..l • \. ~ 0 - :z: ..., ::;:) 5 ~ ·~ u &l LAMB: So we decided to change the name. I said that this was not just about resource mobilization, because it was also about~it was how you used concessional resources generally, as well as how you mobilized them. So it was really about concessional financing in the Bank more generally. And we also-because it had the trust fund stuff and so on, I thought that we should try and signal that this was about the Bank being more active and pulling in development partners, rather than just give us your trust funds. So the name was, you know, you could say it was a little bit sort of cutesy, you know, re- labeling, but it was meant to signal, somewhat, of a change of orientation that I was keen on and that I suppose, in effect, I sort of sold to Jeff [Jeffrey] Goldstein and Jim, by this stage Sven Sandstrom having moved on. Geoffrey B. Lamb November 19, 2007-Final Edited 57 BECKER: Yeah. Now, Goldstein moved on also. LAMB: After a while, yes. BECKER: Now, would he have been the logical person for some-this vice presidency, or was he a managing director? LAMB: No, he was also a managing director. BECKER: Managing director. LAMB: Sven left when the IDA 13 negotiations had been started, but were not complete. And Jeffrey took over . BECKER: I see. LAMB: .. as chairman of the IDA negotiations, but, you know, I had been working for Sven as the director at that point, and then I worked f9r Jeffrey. BECKER: Now the-aside from the issues with the Japanese on this LAMB: Yes. BECKER: .. there were other issues involved here, too, I mean, in the sense that the environment in which the Bank operated was becoming much more complicated .. LAMB: Yes. BECKER: .. and much more complex. ~'*~i4'. iiiJ'··. ··~ LAMB: Yes. Yes. Yes. BECKER: And so my question is, was there something that you and Wolfensohn talked about, or was that something that he and the managing directors were talking about, because it strikes me that what happens in the Bank is that there's-maybe I'm overstating it by calling it a tension-but there's this .. LAMB: Mm-hmm. BECKER: .. friction between those who see the Bank in a very traditional sort of way and those, Wolfensohn included, who were trying to figure out what's this new environment like . Geoffrey B. Lamb November 19, 2007-Final Edited 58 LAMB: Yeah. BECKER: .. and how do we, you know, how do we manage that. LAMB: Yeah. Yeah. BECKER: Now, were you involved in discussions with Wolfensohn and others about this .. LAMB: Mm-hmm. BECKER: .. while you were still at FRM or . LAMB: Yes, very much so. I mean, I think that one-you know, I had plenty of differences with Jim, and some with Jeffrey, but I-it basically seemed to me like they got it in some way about the external environment that the Bank was now in, with the world environment, and Jim could be completely infuriating about that because, you know, he would always-he would always have some particular angle that he was pushing, and you want him to be talking about the big picture, and then-and feeling that he was refusing to. But he was very well aware of it. He was just, you know, pursuing some other objective for the time being. Jeffrey Goldstein, I thought, was very, very smart and, although he'd come out of the financial business in New York rather than out of, you know, the international sphere, he was extraordinarily good at seeing where the forces were, and how the Bank needed to respond. And I-so there were discussions about that. I mean, I'm sure I wasn't in all of them by any means, but I was in some of them. And they were difficult discussions within the Bank because they were so often presented-and this was sometimes Jim's fault, but not always-they were presented as being, you know, the voice of technocratic, well-analyzed reason, i.e., the traditionalists BECKER: Mm-hmm. LAMB: .. versus, you know, the crazy outsiders, i.e., Jim, Jeffrey Goldstein, etcetera, who don't really understand and don't really get it. And l-and, you know, I mean that's an oversimplification, but it-it had a certain credence because I think that-I think that Wolfensohn was not really interested in management. You know, he was not interested in kind of Geoffrey B. Lamb November 19, 2007-Final Edited 59 running a--a better-functioning ship. And he was a sort of a strategist and a-and a visionary, or whatever. And so there were real tensions about efficiency, about people knowing what was going on, you know, and so on, but that~complicated., But I think at bottom, the senior team there had a pretty acute sense of wnat the external environment was like, and the-a lot of managers and staff within the Bank were sort of behaving as if the Bank was a kind of eternal institution, and I think particularly after Bush became president, it was a bit like going back to the Reagan era in that you had people in your largest shareholder who were fundamentally hostile to the existence of the Bank. I mean, you know, yes, they would put up with it. Yes, they would, you know, negotiate or do whatever they were, but they fundamentally ... BECKER: Well, they wanted to turn it into a grants institution. LAMB: Yes. But they wanted to turn it into a grants institution partly because they didn't buy the function that tpe Bank historically had set out for itself. And they certainly didn't buy it as a kind of instrument of multilateralism which will be separate from and in a sense above individual national governments. They certainly didn't buy that. So ... BECKER: Now !-excuse me. I moved you ahead without asking LAMB: Mm-hmm. BECKER: .. exactly how this appointment of the vice president came about. LAMB: Yeah. BECKER: As it-how did it happen? You're still at .. : LAMB: I was still a director of FRM. I was called in to-by Jeff Goldstein, I think, and told that my vice president, Motoo Kusakabe ded to return to the-had decided leave IS was at a very sens1 ·time, Jim felt very strong , you know, I mean, the usual stuff that people tell you when the [inaudible] a job, you know, need strong leadership, need somebody Geoffrey B. Lamb November 19, 2007-Fina/ Edited 60 who's got confidence, you know, confidence of shareholders. I had a good reputation in the Board-that kind of thing. So he was going to appoint me. BECKER: Mm-hmm. LAMB: So-and it was-it was sort of pretty much out of the blue for me. I guess the only thing that I had done about-! didn't really think that I would become the vice president, but I thought if they-you know, if they appoint another person of the old model, I really have to get out of this job. So I had already made up my mind, and I suppose I might have said that to Goldstein at some point . BECKER: Mm-hmm. LAMB: .. but I don't think they appointed me vice president because I said I couldn't [inaudible]. BECKER: Couldn't be [inaudible]. LAMB: You know-but anyway. So there were these changes going on, and I was called in and told that, and then-and then, you know, once I had that conversation, Jim called me and said so, you know, I want you to do this job for us. BECKER: Now the-since the vice presidency had been re-configured . LAMB: Yes. BECKER: .. how much time between its re-.configuration and your taking over did you have to try to figure out what it is you were going to do with this? LAMB: None. None essentially, because-beca\lse we were, you know, we were in-we were already in the midst of some very tough-we were;~.'h.aving a very tough time with the U.S. Treasury over, you know, the issue«bfgrants versus loans, and IDA. I mean, not only with the U.S. Treasury, but that was a very divisive issue among . .,t·' .QECKER: G-7. I~'AMB: · . Jf,t'-7, and among the donors to IDA in general, and, you know, it was just-it was a miserable, miserable issue in that, you know, you could feel that if you were opposed to, you know, opposed to grants, you know, Geoffrey B. Lamb November 19, 2007-Fina/ Edited 61 then people would say what, you're in favor of making poor people pay back their debts, you know. So it was kind of-it was a horrible issue to be in the middle of and the-and the back and forth within the G-7 was very tense. And the Bank was being kind of looked to-the Bank, which meant in practice Goldstein and me, and then my team, were being looked to, to sort of do one position paper after another, or one set of tables after another, you know, with each, you know, with each party demanding at having a particular angle on what they wanted the outcome to be; what they wanted to show. So it was a very, very difficult period. And-and again, it was something where, if I think back, I mean, I think that-that this was also the time when we were trying to figure out how to reform the whole trust fund area because there'd been this scandal, you know, which had burst open when I was doing the IDA job BECKER: Right. LAMB: .. and then now I came back, and we were sort of thinking how do we implement all this. BECKER: Right. And the trust funds were under your response-were part of your responsibility, right? LAMB: They were now were once more under my responsibility, and-and it was a very-it was very hard to be doing more than firefighting, you know, trying to get the trust funds back on an even track, and having donors have some conffdence that their money was being looked after properly, and that. there was somebody awake, you know, in charge. The IDA thing was so difficult with the whole grants versus loans stuff. So it felt like a lot of firefighting rather than kind of strategic how do we do this; how do we position the Bank to be, you know, doing the right thing on concessional finance, on having a coherent strategy for how you support the poor countries financially, and sometimes it was very hard to sort of step back and-and do that with any-with any real coherence. BECKER: So aside, though, from the firefighting . LAMB: Yeah. BECKER: .. your other responsibility, of course, was the next item. LAMB: That's correct. That's correct. Geoffrey B. Lamb November 19, 2007-Final Edited 62 BECKER: Replenishment. LAMB: That's correct. BECKER: And this is a period of time I guess the discussion of donor fatigue, I guess, got . LAMB: Yeah. BECKER: .. got started in the '90s . LAMB: Yes. BECKER: .. and, if I recall, was still around in the period of time that you're doing it. LAMB: Yeah. BECKER: So, how do you deal with that? LAMB: Well, you know, I mean, of course, of course most of us are always pleased with ourselves, and I'm certainly no exception on that. I, you know, I think we did do a good job on IDA 13. Everybody in the end, you know, came reluctantly to a deal. BECKER: To the table. Yeah. LAMB: You've got to do it. You know, we-we sort of split the baby in half on grants versus loans. You know, we got the agreement on the financing of the debt cost to IDA, and you know everybody sort of basically gave up in exhaustion in the end. But on IDA 14, I think we were helped by some of the key donors, particularly the U.K. being in a much more kind of bullish mode, the U.K. and the Northern Europeans about money. And what I tried to do was to be very forthcoming from the beginning in saying look, we-this is not going to be at the first instance about money. It's going to be about what sort of IDA we think the development world needs. And if you guys think we're doing the wrong thing, let's have that discussion. Let's not have a discussion about should it be 14.3 percent or 12.8 percent because we'll just-you know, that won't go. So we tried to say, what's the purpose here? What is, you know, what is Geoffrey B. Lamb November 19, 2007-Final Edited 63 IDA's purpose in the world? What is not being done in current donor financing, including what IDA itself is not doing, that it ought to do, and get that-get that out there as the agenda. And that-1 think that actually was helpful. I mean, because what we did was put on the table to say you know look, we've had a long period where IDA and donors have focused very much on the social sectors, on education, on health, clean water, and so on. That's hugely important, but, especially when we look at the poorest countries, these countries just have to grow faster. So, why haven't we been paying enough attention to growth? And, of course, it's got to be growth that doesn't ignore human capital and human suffering for sure, but we've got to think about what's needed there, and that means, you know, why did IDA and all the rest of the donor community walk away from infrastructure, for example? Well, we walked away because we had this kind of notion, in some cases ideological conviction, that the private sector was now going to finance infrastructure worldwide. Well, it didn't even do that in the middle-income countries, let alone in the .. BECKER: In the poor ... LAMB: .. in the poorest. So, you know, so we sort of put some of those issues back on the table and said, you know, you the donors need to think whether structurally IDA should be playing this kind of role, which no bilateral donor is going to-no bilateral donor is going put, you know, $500 million, $1 billion, $1 Y2 billion into big infrastructure in thf,':se countries. So maybe that's our role. Let's look at the architecture of aid and say who does what. And I think that did succeed in, if you like, elevating the discussion a bit and got people engaged and interested. [End Tape 3, Side A] [Begin Tape 4, Side A] LAMB: And then we also decided, you know, taking into account the debt forgiveness costs, and taking into account this new agenda-well, not new, but sort of, you know, revitalized agenda, and so on. We put a big-a big ask on the table, which I remember Wolfensohn-I remember Wolfensohn saying, "You must be crazy." You know, you have-but Jeffrey Goldstein had been encouraging about that. I mean, he was still there and was chairing the negotiations, and so we said let's got for it. Let's, you know, let's just ... Geoffrey B. Lamb November 19, 1007-Final Edited 64 BECKER: So it ends up being a 25 percent increase rather than a 30 percent LAMB: Yeah, and we asked for 30. We asked for 30. I mean, we made the case for 30. We made the building blocks. BECKER: Mm-hmm. LAMB: Here's what the country is going to absorb. Here are the projected growth rates. Here are the required investment needs, and we worked actually rather well with the Fund on that occasion because, again, it was something that, you know, I got our team to put a lot of investment in. So the Fund was kind of, you know, the Fund is often a skeptic on aid flows and so on, but the Fund was very good and very supportive in saying yeah, we think this is credible. Yes, we think these countries can absorb it. And so on. So we had-we had a good case. BECKER: Mm-hmm. LAMB: And then, you know, then the Fund was in the negotiating, and seeing, you know, how you could put the bits together and, you know, in issues like you knew that the U.S. had to be the big-has to be the biggest contributor, because no body else will let-will let the U.S. not be the biggest. BECKER: Right. LAMB: But at the same time, the U.S. was actually saying our share of IDA is going to go way down. And, in fact, they went down from an historic level of 20 percent down to 14 point something. So the Japanese would not go above the U.S., but we wanted to keep the Japanese only just underneath. You know, so it was part-you know I actually find that quite fun, sort of figuring out the politics of how . BECKER: Yeah. LAMB: .. to bring, you know, how to bring people to BECKER: No, but you said also the Northern Europeans and the British were .. LAMB: Yeah. Geoffrey B. Lamb November 19, 2007-Final Edited 65 BECKER: .. cooperative in . LAMB: Yes. And were-and were the French, actually. BECKER: And the French. LAMB: And were the French. BECKER: Yeah. LAMB: Yeah. So they-yes, I mean they were-the British-! mean, it's a slight exaggeration, but the British, with whom, you know, I had made sure to keep up pretty good relationships . BECKER: Yeah. LAMB: .. essentially said, you know, there are one or two things that we need to have in the agreement which we think you can take care of. But you can regard us as being prepared to fund any plausible level that you can get everybody else to. So, you know, and the French essentially said, in a slightly more dyspeptic French Gallic way BECKER: Right. LAMB: .. we can do at least as well as the Brits. So I sort of knew that I had two big buckets of money, and so it was doing the dance . BECKER: Yeah. LAMB: .. but to get everybody else in place, and then one could bring in these very strong-these strong contributions. So ... BECKER: Not to-something that occurred to me when I was reading about this was that what role did the sort of the international community's dislike of the Americans at this point play in this? I mean, did you benefit at some point? LAMB: You know, it' s-1 mean people-to be-to be honest, people in the IDA 14 discussions, people were mainly relieved that the U.S. was not being as awkward or as intransigent as it had been the last time around over the grants versus loans thing, and that was-it's hard to overstate the unpleasantness of that. Geoffrey B. Lamb November 19, 2007-Final Edited 66 BECKER: Right. Yeah. LAMB: And so the fact that the U.S. was signaling that as long as the grant proportion came out somewhere politically plausible for them, which meant that it couldn't go any lower . BECKER: Right. LAMB: .. they were not going to make a big song and dance about it. They were also not going to put very much money in. But they-so that the fact that the U.S. was relatively quiescent and collegial . BECKER: Helped. LAMB: .. just made it easier. BECKER: Yeah. LAMB: It made it easier. BECKER: Let me turn to something else that obviously you feel very strongly about, and 1 want-it's on AIDS and. LAMB: Mm-hmm. BECKER: .. other diseases, and so on. LAMB: Mm-hmm. BECKER: Where does that fit into your career? When did you first begin to get interested in that? LAMB: Oh. Oh, okay. That was-actually, that involved Joe Stiglitz as well. Well, I got Joe Stiglitz involved in the-one of the things that-one of the things when I took over the Trust Funds Department, and as I've confessed to you, I was looking around for interesting things to do in that job other than the kind of fiduciary grind, as it were. I thought-look, one of the things that we ought to do-use trust funds for is, unlike normal Bank finances, is use it for what one might call global public goods purposes. BECKER: Right. LAMB: And that discussion about global public goods was just getting going Geoffrey B. Lamb November 19, 2007-Final Edited 67 then. BECKER: Now, this would be the late '90s? LAMB: '90s. Yeah, 1997, '98 BECKER: Mm-hmm. LAMB: .. around there. And I was sort of interested in general in something like AIDS as a leading example of a public bad that crossed borders and that, you know, one needed to do more of, and there was-there was obviously sort of a lot of pressure on the Bank to be doing more and being seen to do more. But I was asked by a couple of-a couple of women who were working on- you know, on health in the Bank-Amie [E.] Batson and Martha Ainsworth, who was a health economist working in DEC, and Arnie was working in the HDN-Human Development Network-was asked if I would help them with the financial part of a task force they wanted to get together on the issue of AIDS vaccines. BECKER: Oh. LAMB: A little internal task force. And I thought this was a fabulous idea, and I said, "Absolutely," and, you know, we ought to have, you know, trust funds that help to do this, and so on. And it turned out that the Bank had already been making a small grant to a new thing called the International AIDS Vaccine Initiative, which had just ... BECKER: lA VI. LAMB: lA VI-which had just started in '96, or some time. And I asked-1 said, "Why don't we get the head of lA VI to be an external member of our task force?" which we did, and then we got Joe Stiglitz to be the convener of, you know, a meeting of people in Paris to talk about this-of donors, which was kind of interesting. The U.S. was profoundly skeptical and so on, and then, you know, a few weeks later the Bush initiative and huge funding, and so on. But it was the Democrats at that time. And so we sort of got this little task force together. These two women were really the sort of pushers and movers, but, you know, I-I was-1 think I was the sort of the most senior internal figure, so I was useful for legitimacy, and Geoffrey B. Lamb November 19, 2007-Final Edited 68 I was the money guy. So that was also useful. And we did this report, which we got Wolfensohn to, you know, read and take notice of, and so on. And-but I had just got more and more substantively interested in this. And then Seth Berkley, the IA VI president . BECKER: Mm-hmm. LAMB: .. asked me if I'd join their board, which I did in 2000 or so, and I, you know, I asked Jim, you know, is this okay, because I'm not going to be a member of this board ex officio representing the Bank. BECKER: Yeah. LAMB: It's a-it's a kind of voluntary thing, and he said, "Absolutely," which then caused various heartaches to the legal people and the conflict of interest people, but I did it and managed to-it never became a-it never became a really bad-you know, a really difficult issue. So that's how. BECKER: Oh, okay. LAMB: That's how. BECKER: It seems to me that in the case of, you know, international public goods, I guess the environmental issues, of course, would be one LAMB: Yes. BECKER: .. and I guess also financial stability is another one that you'd want to ... LAMB: That's right. That's right. Well, we then-we then did-1 guess it was when I was at FRM-because I'd been making this argument about public goods and so on, we-we were asked to do a paper on the Bank and global public goods, which I wrote with, then-and she is still is quite young I guess-a young woman called Maria lonata, who at that point was working in PREM for Kemal Dervis. So it was notionally a joint paper between Kemal and myself, which we went to the Board, where we outlined these four or five areas on of infectious disease, financial stability, environment-! think we had conflict. There were five. BECKER: Was there military spending? Was that part of this, or ... ? LAMB: No, the military spending thing was way back before. That was Geoffrey B. Lamb November 19, 2007-Final Edited 69 one-that was one of the topics in the Strategic Planning days . BECKER: Oh, okay. Okay LAMB: .. that I took up and did a thing on them, and we had a little Bank policy that came out of that on military spending. [Lamb, Geoffrey, ed., with Valeriana Kallab. World Bank Discussion Paper 185: Military Expenditure and Economic Development: A Symposium on Research Issues. Washington, D.C.: The World Bank, 1992 .] I forgot to mention that. I can't remember the other thing. BECKER: Oh, well. LAMB: It was in 2001 we-2001 we did this-this Board paper. BECKER: Well, it seems to me that this is another part of the more complicated environment that the Bank . LAMB: Yes. BECKER: .. is, you know, involved in. LAMB: Yeah. BECKER: Well, how does the Bank ultimately, from your point of view manage this? LAMB: I-you know, I was urging this on Bob [Robert B.] Zoellick when I had a session with him at his request a couple of months ago. I think-! think if you looked at-I don't think that the world needs the IBRD [International Bank for Reconstruction and Development] for the purposes which needed it for the last 50 years, or 40 years, or whatever. But there are all of these large and increasingly global or cross border problems, which are always being sort of thought about and solutions brought up, and particularly financing put together on this kind of unsatisfactory ad hoc basis. And at the same time, there's $45 billion of equity sitting in the IBRD for, you know, which is mainly dedicated to a product, which is sovereign loans to middle-income countries for which there is declining demand. So it just seems to me so obvious that if you thought what do you need World Bank for, you need a World Bank to tackle world problems and to help finance the solutions to them. So I think the trend ought to be in that direction. I think some of the steps Geoffrey B. Lamb November 19, 2007-Final Edited 70 that have been taken on, you know, climate change, and on, you know, support for global health initiatives and so on are sort of very cautious steps in that direction, and, you know, no doubt it will be difficult to bring along many of the shareholders, etcetera, etcetera. But it just-and-and it just seems to me that the Bank will-the IBRD will lose a huge amount of credibility unless it can make BECKER: It does that. LAMB: .. that sort of change. BECKER: But, I mean, it still has a role in places like Africa, where even though there are these enormous private capital flows, although the Chinese seem to be taking a great deal of interest in . LAMB: Right. BECKER: .. in Africa. LAMB: But you need the IDA-type vehicle, because you need-you still need below-market financing for. those countries. And you're going to need it for some of them for a very long time. For others, let's hope you only need it for another generation or so. And you need to be-you know, we need to be more creative, and I think Zoellick is actually pretty smart on this issue in saying you've got to take- somehow got to take below-market finance, i.e., the IDA concessional stuff, and marry it much more effectively with private sector money without that just ending up by, you know, writing a check to a lot of corporations. BECKER: Mm-hmm. LAMB: You know, I mean, without just cross-subsidizing them. So you somehow have got to find creative ways of having more of a sort of market- authentically-based, market-driven process in these countries, and less of a kind of aid transfer. But you're going to need that pool of concessional money, I think, for a long time to come. BECKER: Yeah. Yeah. Well, again, especially in Africa. LAMB: Yes. Yes. BECKER: Why did you retire in 2006? Geoffrey B. Lamb November 19, 1007-Final Edited 71 LAMB: Because I was by then some months over the retirement age. BECKER: I see. Oh, okay. LAMB: I ... BECKER: You had been there 26 years then, I guess. LAMB: Yeah. I was-~I turned-! turned 62 in February of 2006. BECKER: Mm-hmm. LAMB: Wolfowitz asked me to stay on for a while longer because we were in the middle of the MDRI [Multilateral Debt Relief Initiative] negotiations. BECKER: Right. LAMB: You know, the debt forgiveness BECKER: Right. LAMB: .. negotiations, the G-8 deal. And then asked me stay on for a couple months after we did that deal just to sort of do one or two private things relative to corruption,actually, and in terms of looking at some of the stuff on corruption. So, yeah, I mean I was-I was having a good time. You know, if the retirement date had been 65, I'd probably still have been doing that job. BECKER: Mm-hmm. LAMB: So it just .. BECKER: It was ... LAMB: .. it was that. It was that. BECKER: Okay. Just to-I always ask for some general reflections. LAMB: Yeah. BECKER: You've already reflected on some of the things I was going to ask you about. But many people who look at the Bank-refer to the Bank very Geoffrey B. Lamb November 19, 1007-Final Edited 72 much as a presidential institution. The president really does have-it's true in a lot of corporations, and so on. But you've mentioned Wolfensohn .. LAMB: Yeah. BECKER: .. and obviously you would agree that-I mean, not agree, but you suggest that you think that he certainly was very important . LAMB: Yes. BECKER: .. and all, but do you want to add anything to what you've said about him or ... LAMB: I mean, I . BECKER: I want to ask you about some of the other presidents . LAMB: Right. BECKER: .. as well. LAMB: I think-! think Jim, although-although he would probably bridle at this, I think Jim grew hugely on the job. You know, I think when he came in, and there was some rather sort of snippy, you know, editorials from my-you know, by my friend Martin Wolf on the FT and others saying, "So what is your vision?" I think Jim was driven mad by that because he really didn't have one. BECKER: Mm-hmm. LAMB: He had a set of very good political and commercial financial instincts, but no view about how the world ought to be, what deveLopment ought to be, what the role of the Bank was. But I think he grew an awful lot. And so he-you know, I remember when he was obviously not going to be given a third term as president, although I think Jim still slightly hoped that he would be. BECKER: Yeah. LAMB: I remember saying to one of my colleagues, "You know, the irony is he's been driving us absolutely mad for 1 0 years. He's now at the top of his game. He will probably be a great president . " BECKER: Yeah. Geoffrey B. Lamb November 19, 2007-Final Edited 73 LAMB: .. "for the next five years." So that's sort of, you know, that's where I ended up. I mean, I ended up also having not been a great favorite of his. You know, I think I annoyed him quite a lot, sometimes because my job was objectively annoying . BECKER: Yeah. LAMB: .. because I was telling him no, you know, you can't . BECKER: Yeah. LAMB: .. do things. But I actually ended up quite good friends with him, and, you know, sort of respecting him quite a lot, having really not thought that I would earl_y on. BECKER: Mm-hmm. Now, all the presidents, putting . LAMB: Yeah. BECKER: .. Wolfensohn aside LAMB: Yeah. BECKER: .. who gained your greatest respect? LAMB: Urn-although he was there such a short time, I had a lot of respect for Lew Preston. BECKER: Mm-hmm. LAMB: He just seemed to me to-I mean, in a way he was a certain kind of old style, you know, patrician banker in demeanor, but a sort of thoughtful- really thoughtful and, I think, genuinely kind of modest and, you know, it sounds funny to say it about a top Wall Street banker, but it-but almost selfless person. You know, I think he decided that the Bank was a matter of public service to him. It was slightly accidental, because it was a sort of old boy network that he . BECKER: Yeah. LAMB: .. found himself in the job. But he would seem to really to be Geoffrey B. Lamb November 19, 2007-Final Edited 74 taking it seriously, and to be kind of thinking about what it meant, and what he wanted to do, and so on. Now, you know, that may be wrong because he was there really such a short time before getting ill. BECKER: Yeah. LAMB: I also liked-1 liked Barber Conable a lot because he was kind of, you know, sort of plain old guy. You know, he was kind of a regular guy with-from such a different-such a different world from the one he found himself in .. BECKER: Mm-hmm. LAMB: .. but so artless in expressing that. And-so he was kind of miscast in a fairly sort of noticeable way. But I thought that-I thought that he had a-he had a capacity for sort of, you know, to be honest, for seeing where some important things, and where some bullshit was being tried out on him. You know, he had a kind of, you know, a sort of main street Republican good sense about him that I used to find quite appealing. BECKER: Yeah. LAMB: I never-! always felt embarrassed whenever he made a speech because it was so-so hokey, and he was so ill at ease. And, you know, I would sort of feel what-you know, why doesn't he crack the whip more on these fractious lieutenants of his? But I thought he was a sort of decent guy, with a kind of bedrock integrity that I, you know, I respected. BECKER: If I may ask, what's your thought about the entire Wolfowitz affair or .. LAMB: You know, the irony is that for some reason, partly I suppose becaus was told that Wolfowi tz was told coming was told by friends in the U.S. government that Wolfowitz was essentially given a briefing on the senior people in the Bank before he came in, and I'm sure it was a highly partial briefing. BECKER: Yeah. LAMB: But I was told that as part of that briefing he was told that I was a son of a bitch, but I knew my job. So he sort of came in pre-disposed. You know, one of Paul's kind of quirkinesses was that having been told I was told this guy is no friend of the United States, but he's good at his job, which, you know, was already a spin .. Geoffrey B. Lamb November 19, 2007-Final Edited 75 BECKER: Yeah. LAMB: .. you know, but he found that attractive. well disposed towards me, So I kind of got on well with him at the outset. He liked arguing with me. He seemed to like the fact that, you know, I told him-he's an intellectual, so he likes arguing .. BECKER: Ideas. LAMB: .. ideas. He doesn't change his mind. I mean, he is-he's absolutely not shiftful on most things that he's made up his mind about. BECKER: Yeah. LAMB: But, you know, we got on personally quite well. He landed-he almost literally land-walked into the job as the debt forgiveness deal was announced by the G-8. I was on vacation in Britain when that June 2005 meeting took place in London of the finance ministers, and Robin Cleveland called me on my cell phone and said, you know, "Where are you?" And I said, "I'm on my way from Cornwall to London with my family," and she said, "Can you be here," you know, "tomorrow?" And so I went along. I didn't go in the meeting, but I was sort of there to brief Paul, and so on. And I remember him sort of being all excited about the debt forgiveness and saying, "So what do you think of the deal that we got?" all kind of pleased, and so on. And I said to him, "Well, I suppose it's not quite the worst deal we could have got, but it's close." And-and he was sort of-he wasn't- you know, the thing about it, Jim-Jim would have been beside himself with rage if you said that to him. BECKER: Yeah. Yeah. LAMB: Wolfowitz was not angry. He was just kind of taken aback .. BECKER: Yeah. LAMB: .. and then intrigued. So, from that point of view, you know, you could actually argue. He did actually, in my view, come through on the debt forgiveness stuff, because he stood up to the U.S. and the G-8 on the issue of Geoffrey B. Lamb November 19, 2007-Final Edited 76 financing of the debt forgiveness in a way that I think was politically tough, but he didn't-he didn't walk away from me. I was in charge o(it. He didn't walk away. It sort of happened. And I think he got as good a deal as we could have got from it. So 1-I was fine with him on that core issue, which was .. BECKER: Right. LAMB: .. to do with my portfolio. BECKER: Right. Geoffrey B. Lamb November 19, 2007-Final Edited 77 Geoffrey B. Lamb November 19, 2007-Fina/ Edited 78 BECKER: Yeah. One final question, if I-oh, actually two questions-how did the [Bill] Gates appointment come about? LAMB: Oh. I don't exactly know, in the sense that I knew a number of the Gates people, for two reasons: one, because Gates is a big donor to IA VI, which. . · BECKER: lA VI. LAMB: .. which I now chair the board of. BECKER: Uh-huh. LAMB: lA VI. And so-and one or two occasions, as it happens, I'm sure you're very familiar with this yourself. You know, when you're a board member or a board chairman, your function is sometimes to run a bit of a kind of back channel settling of disputes or, you know, of difficult issues with some external party, and in this case, there were a couple of run ins between the CEO and the Foundation . BECKER: I see. LAMB: .. or a particular senior individual at the Foundation, and I would be sort of calming the waters a bit, or finding a way through. So 1-I'd come into contact with them that way. And then when I was-when I was in my job as vice president-or maybe even when I was in IDA job-1 don't quite remember-the Gates Foundation had wanted to set up a rather novel form of trust fund with the Bank in order to provide funding for polio eradication. And the structure that we worked out was essentially using Gates money to pay down the difference between an IDA loan for polio eradication and an IDA grant, to pay it down to a grant. And I was interested in that because it was a creative use of financing for a global public good. It was much-it was much more valuable to the world for Pakistan to eradicate polio, then it was valuable to Pakistan. BECKER: Mm-hmm. LAMB: I mean, Pakistan has got lots of other problems. BECKER: Yeah. Geoffrey B. Lamb November 19, 2007-Final Edited 79 LAMB: But the world wanted Pakistan to eradicate polio. So, therefore, the world was informed the Gates Foundation was prepared to make a special payment to make that happen. So it was sort of a creative thing that we worked. So I'd come into contact with them that way, with the CEO and a few of the others. And it actually-you know, it actually-what, three or four months before I was due to-well, before I was due to retire, Patty Stonesifer, the CEO, phoned up and said, "A little bird tells me you're due to retire. When you do, don't talk to anyone until you talk to us." And that was, you know, and I said, "Well, fine, I'm not talking to anyone while I am still in this job. When I'm not in this job," you know, "I'll give you a call," which is what I did. BECKER: Oh. LAMB: So that-it-it literally happened like that. BECKER: Mm-hmm. LAMB: So, you know. BECKER: And my final question always is, you know, what does the-what do you think of the future role of the Bank and development and all that? And you've more or less answered that. But I thought that if there is anything that you didn't say that you might want to say? LAMB: I mean, I answered it, Bill, on the-you know, on what I thought would be a-would be the only part for it on the IBRD side BECKER: Right. Right. LAMB: .. when I thought any real use for IBRD over the longer term. My view is a bit somber on the concessional finance side, because I think one of the things that's happened, partly because of the public goods agenda that's become .. BECKER: Mm-hmm. LAMB: . .is that the sense that the Bank and IDA-IDA in the first place- other funds as well-are the kind of natural forum for trying to do the big development jobs in the world. That sense, I think, is really evaporating. And, you know, it used to be the case-I'm obviously oversimplifying-that the Bank would go to the donors and say well, here we are again, you know. We've got some jobs to do. Clearly, the Bank is the entity to do them. Now Geoffrey B. Lamb November 19, 2007-Final Edited 80 let's just talk about how we do this and what it's going to cost. Whereas, increasingly, you know, people are saying well, maybe we'll set up a global fund to do this, maybe we'll set up a special entity to do that. Maybe the markets can do this, and we don't need the World Bank to do it. And I think, you know, that's okay from one point of view, although I think the transaction costs on developing countries are quite high on poor countries. But the thing that-and this applies to across the street, to the IMF as well- the thing about the public good that is represented by the set of skills and experience in this place, once you-once it starts to bleed away, it's very hard to think of circumstances under which it would BECKER: Come back. LAMB: .. come back. And, you know, the biggest risk across the street with the Fund is, you know, [Dominique] Strauss-Kahn said okay to 10 percent cuts. Their business is-their business as it has been is evaporating. The fact is the Fund does some of the highest quality macro and financial analytical work in the world. And as well as being a huge repository of data and knowledge and so on, and the Bank in a different kind of way is just an enormous-I've become-! can't bear all the talk about the Knowledge Bank and all-you know, that sort of just bores me. But, you know, there are all of these people who are very good at a lot of development things. They're not- probably not as good compared to the cutting edge as they were 10 years ago. That's part of the problem. But it's very hard if you don' f you don't keep that together, it's very hard to see how you get it done. I mean, I'm very aware at the Gates Foundation-and partly because it's my habit anyway-but we'll get a novel question, or we'll get, you know, something that somebody' s puzzling about, or some data that somebody wants to get at, and the Gates Foundation will throw whatever it takes to get whatever it needs to get at the highest possible level of expertise. And when we at Gates go to get that development expertise, we will very often find ourselves, you know, looking down the telephone book that you still get from the Bank, and calling people up and just being astounded at the depth of the bench. BECKER: Mm-hmm. LAMB: So I sort of worry about that almost as much as-you know, I think the financing will get done one way or another. I think it will probably get done a bit less effectively if it's chopped up into lots of special funds and initiatives and facilities. Maybe not, but I think it will probably be less Geoffrey B. Lamb November 19, 2007-Final Edited 81 effective. But there won't be-there won't be this corpus of expertise. BECKER: Well, the Bank then-what you're saying is that the Bank can't expect to be the leader of these-in these different . LAMB: No. BECKER: . in dealing with issues, but to keep its edge, it has to be a partner. LAMB: That's right. BECKER: Constantly a partner with the sort of ... LAMB: That's right. But the instinct to say we ought to be in charge. We ought to be in the lead . BECKER: Right. LAMB: .. is still very strong here. BECKER: Right. LAMB: And I think that may mean that people change less quickly than they would. They're less flexible. They're less agile than they need to be. BECKER: Well, thank you very much. It's been really wonderful. LAMB: Oh, I enjoyed it. I enjoyed it. [End of Tape 4, Side A] [End of interview] Geoffrey B. Lamb November 19, 2007-Final Edited