A readership of one

The intended readership of the Washington Post today is one person; let us call him “the man without the mustache”. This limitation is oddly liberating in the sense that writers need no longer bother with understanding or facts or contrary expertise. They have only to ask themselves: How will this play down the street ?1

An answer to this question can be found in the Post April 16, 20262, in which David Lynch discovers that the Trump administration now approves of the World Bank and the IMF. Lynch’s lead is “Under pressure from the administration, the IMF and World Bank have modified their policies, de-emphasizing issues that irk the president such as climate change and taking steps to support key U.S. foreign policy objectives in places like Argentina and Ukraine.” In this passage, remarkable in its misrepresentation of the goverance and operations of the two entities, Lynch has endorsed the notions that the US runs the Bank and the Fund as minor subsidiaries of the USG and that this imaginary arrangement actually promotes the global development missions of the two institutions by forcing them to be more efficient. Lynch’s article is so misinformed, with rare exceptions, that one imagines Scott Bessent to have dictated it. As convenient as parroting the White House line may be to access journalists, “convenient” does not always signify “true” and the result is an article that should have been relegated to the NY Post3.

Misrepresenting the Fund

Lynch’s sources. Lynch mainly used sources from the IMF. I am not revealing a secret when I tell you that many Fund people, present and past, have a somewhat constrained understanding of reality and that their value as sources can only be appraised in that light. Douglas Rediker (US ED in the Fund, 2010-12) encapsulates this understanding in speaking of what the US can do from its dominant perch above 19th Street. Lynch cites Rediker: “Having a large pool of capital, both at the Bank and at the Fund, available to advance your specific narrow interests in some cases and your broader global financial stability interests, without dipping into U.S. taxpayers’ funds, turns out to be a good thing”. This confounding of the interests of the largest shareholder in the Fund and the Bank with those of the global economy is the message that Lynch sought to describe as a good thing and as a return to the lost world of 1946.

An example of what the US can tell the servants to do is the Bank’s current plan for a US$2 billion loan to Argentina. The official version will be “sustainability”, “poverty alleviation”, u.s.w. The unstated rationale is that Kristalina Georgieva (Bulgaria, MD of the IMF since 2019) has no more money to give to Javier Milei4. As a result, Bessent had to instruct the Bank to make up the difference given Argentina’s heavy debt service in 2026. This is consistent with Rediker’s account of the US-Bank-Fund mechanism but not with the Post’s fairy tale about the US-Bank-Fund purpose (“global financial stability”).

Another Fund source for Lynch’s piece is Mark Sobel (Fund staff for decades and US Treasury Representative to the IMF from 2015-18) who chides Georgieva for “… getting over her skis in talking about climate and gender and inequality and whatnot …”. Sobel’s remarks, beyond being deeply sexist—the patronizing tone about Georgieva, the casual dismissal of what Sobel implies to be frivolous girl issues like climate change, gender, and inequality—characterize the US view that it alone decides what is worthy of serious consideration in this life.

We learn from anonymous “analysts” that Dan Katz (ex-Bessent CoS at Treasury, “dispatched” by Bessent to occupy the position of First Deputy Managing Director at the Fund) acts as an “effective bridge between his current and former employers”. Lynch blithely accepts this blatant conflict of interest—does Katz work for the Fund or does he work for Scott Bessent ? Does the USA get a superweight of its shares in the Fund because that institution is now paying Katz’s salary? Does Lynch understand that Katz has no business being at the Fund at all ? 5 This is Lynch accepting American corruption and cronyism as the normal course of business and I am sure he is mystified why anyone could possibly object6.

Misrepresenting the Bank

Lynch reports that Bessent is seeking to “refocus lending to poor and most fragile countries”. It has long been a staple of the corridor talk of the US and the UK Executive Directors in the World Bank that “taxpayers’ money” cannot be used to finance socialism, etc, etc, in China. Such talk ignores the facts that Bank lending to China is profitable and that the profits are recycled through the Bank’s net income into funding for the Bank’s concessional window (IDA, the International Development Association)7. Bessent has apparently forgotten that the World Bank Group has at least three windows one of which (IDA) lends only to poor and fragile countries and does so at a steep discount.

“Humanitarian endeavors”. Lynch makes the indolent claim that “Banga had begun overhauling the bank’s development portfolio to emphasize job creation rather than humanitarian endeavors.” The Bank is not a humanitarian organization. It finances development investments. A passing acquaintance with the Bank’s work or interviewing staff who do projects at the Bank would have shown what the institution does and that the Bank has long focussed on employment creation through capital formation and technical change. To better understand the Bank, Lynch ought to have started with Parminder Brar’s magisterial series on the Bank at mdbreform.org, but this probably wouldn’t get him points down the street.

The green transition. One of the rare insightful sources that Lynch could find is Clemence Landers (USA) who was an advisor to the US ED in the Bank in 2015-17. Landers is astute enough to see what Banga is doing—changing the “nomenclature” about the green transition without changing anything fundamental in what the Bank does. If Banga gives in to the US on the 45 percent target for green lending, fine; the 45 percent is an arbitrary number and can be manipulated anyway. The Bank can lower the target to placate Bessent, exceed the revised target to satisfy the NGOs, and thereby continue with the green transition.

What these misrepresentations reveal

The misrepresentations of Lynch and some of his sources do not reveal misunderstandings in the sense of not having data or methods to analyze data. What they reveal is a strategy to hold the fleeting attention of the Post’s one reader by creating an alternative reality. Some examples follow.

Venezuela. Lynch notes that “On [April 16], the IMF said it would resume dealing with Venezuela after a seven-year break, effectively recognizing the government of President Delcy Rodríguez.” The reference to “a seven-year break” should be to “a twenty-two-year break”8 and the contradiction is not a minor one. The Fund’s official line (https://www.imf.org/en/news/articles/2026/04/16/pr26123-venezuela-imf-announces-resumption-of-dealings) was that it stopped dealing with Venezuela because of questions about the legitimacy of the Maduro government. How convenient that questions about the legitimacy of Maduro’s regime were one of the (admittedly fluid) rationales for Trump’s invasion of Venezuela. The reason for Lynch to include passing reference to Venezuela is to confirm that the US is running the IMF; a secondary reason is give the Post’s few remaining readers the wrong idea about how a financial “deal” with Venezuela will be as cheap and quick as invading that country.

China’s trade surplus. Lynch’s sources have explained one complex problem clearly9: (a) China has an export surplus, (b) China is not doing enough to raise domestic demand, and to thereby lift imports to lower its balance of trade surplus, and (c) the Fund has not moved China off its trade surplus. Parts (a) and (b) are true, as is part (c) but Lynch misrepresents why (c) has failed. Moving China off its surplus has not failed for lack of trying. It has failed because the Fund can do little or nothing about China’s surplus. The Fund can bully Costa Rica, threaten Zambia, choke Sri Lanka, suborn Pakistan and Egypt, and throw Greece into the flames, but it cannot do anything about China’s surplus and everyone knows it. Lynch’s ex-IMF sources know it. Kristalina Georgieva knows it. Even Bessent and Katz know it but they go along with the charade because it placates the man without the mustache. It is bad journalism to credit the US administration with something that has not happened and will not happen because of anything the IMF does.

Argentina. Lynch contends that the “IMF and World Bank have modified their policies, de-emphasizing issues that irk the president [again, the fallacy that the purpose of the Bank and the Fund is to please the White House] such as climate change and taking steps to support key U.S. foreign policy objectives in places like Argentina and Ukraine.” The US has no foreign policy interests in Argentina, key or otherwise. Now, it may have the personal interests of some members of the US administration and of certain North American financial institutions; one may excuse Lynch for not understanding the difference in the rush to deadline.

Ukraine. The US does have “key foreign policy interests” in Ukraine, but the actions of the US in support of Ukraine in the Fund are small compared to what the US is doing to betray Ukraine. It has escaped Lynch’s notice that the US administration is causing the deaths of thousands of Ukrainians, preventing Ukraine from defending itself, and indirectly funding the continuation of the war against that country.

The IMF claims (anonymously) that it has been “sharpening its policy advice and supporting an ‘orderly rebalancing’ of the global economy”. These are common Fund obfuscations. Lynch gives no example of sharper advice—the Fund cannot either for that matter—and the anguished cries of the private credit cabal in the FT suggest that the impending re-balancing will not be orderly. Had the Fund really sharpened its policy advice (Senegal ? Argentina ? Venezuela ? Pakistan and Egypt ?) it would have bragged about its success interminably during the Spring Meetings.

All of the above energy. Lynch writes that “The World Bank last year abandoned its long-standing refusal to finance nuclear power development and moved closer to the Trump administration’s preferred “all of the above” energy policy, which makes room for fossil fuels including coal.” This again shows that Lynch does not bother to understand how the Bank works and, more fundamentally, what its purpose is.

The Bank has indeed softened its refusal to fund nuclear power.10 The new nuclear policy is nonetheless, meaningless, though it has fooled people like Lynch into believing that it is a real change. The delusion that the Bank will fund “all energy” including coal is, again, a trap set for Trump’s ego, into which his cultist apparatchiks have jumped. The rapid fall in the costs of renewables-plus-batteries is making coal uncompetitive today and will make it less competitive tomorrow. Will African countries import high-cost coal or tax imports of Chinese equipment to flatter the US government or borrow from IBRD to develop dirty energy ? Only if it is significantly cheaper, which is not the case today. Banga has outsmarted the White House with a few blank sheets of paper.

The language of business. Lynch writes that “The former Mastercard executive chairman (Ajay Banga) is fluent in the language of business that Bessent and his boss appreciate”. The language of business, to the man without the mustache, involves bankrupting four casinos, dozens of lawsuits for non-performance of contracts, and blatant corruption in his companies and in government. That language, to Bessent, involves rolling up a loss-making hedge fund, refusal to respect US financial disclosure laws, encouragement of identity theft from within the USG, and a general tolerance of corruption throughout the Cabinet.

Climate finance and gender. I here paraphrase my post on Bessent’s 2025 speech to the Spring Meetings as a way of showing again what Lynch is hiding from his readership.

Bessent snipes at climate finance in the Bank and the Fund but he has no idea what he is talking about. Part of his myopia on climate is that he cannot distinguish between mitigation and adaptation. The poorest Bank member countries generate ^[10] small amounts of greenhouse gas (GHG) emissions per capita; their capacity to absorb mitigation investments, with public or private finance, is small^[11]. The same low-income countries, especially those in the tropics where temperatures and floods will increase the most under global heating, will require concessional global finance for large-scale adaptation investments ^[12] (dams for hydro power and flood control) and local finance for smaller investments (soil conservation, construction standards, regulation). There is much that the Bank could do to be more effective in mitigation and adaptation finance, but it is less able to do better work when the representative of its principal shareholder is so poorly informed.

Bessent’s sneer at the gender work of the Fund reveals that he does not understand that the returns to investments in women and girls—political power, health, education, training for and access to jobs, freedom from violence and harassment—are high. Such investments can help, modestly, to fix the world’s longest-standing, most important, market failure: discrimination against women. The obvious thing for Bessent would be to tell the US representatives in the Fund and in the Bank—we are concerned that the Fund is trying to do things in which the Bank has a comparative advantage; please express firmly the administration’s concern to Bank and Fund management that while the US supports the gender transformative agenda and wants it to be extended, it insists on more effective collaboration between the two institutions on their respective programs to strengthen the rights, status, capacities and welfare of girls and women.

The '“Board of Peace” (BoP). My Substack “Why is Ajay Banga still President of the World Bank ?” (April 16, 2025) discusses this ongoing crime. With respect to Lynch’s piece, he claims that ”many analysts” saw Banga’s joining the Board of Peace as “illustrative of his desire to get in harness with the administration”. While I do credit David Lynch for that apt livestock metaphor, he is wrong to recite the Bank’s rationale for joining the Board of Peace (the “Bank said it was mandated by a United Nations resolution on the postwar reconstruction of Gaza”) and he fails to understand the many serious conflicts of interest created by Ajay Banga’s personal role in the BoP.