Trump nominates a sharp critic of the World Bank as their new boss

"Do not panic," said the financial expert. The turbulence in the US real estate market is only part of a necessary correction: "The economy is robust and will grow solid over the coming months, if not years."

These words come from August 2007. The financial crisis was approaching, the expert name was David Malpass, he was chief economist of the traditional US investment bank Bear Stearns and wrote in an essay for the "Wall Street Journal" the coming storm small.

Seven months later, Bear Stearns, co-responsible for the crisis, collapsed. Then Lehman Brothers went bankrupt. The world sank in the crisis vortex.

Malpass's career did not hurt that. He set himself up, continued to make false predictions, Donald Trump agreed. And he nominated him as the new president of the World Bank.

AP

Donald Trump and David Malpass

Of course, it's not just the professional misses that make Malpass's appeal so controversial. What disturbs even more is his securitized aversion to the very same World Bank that he now leads in the name of Trump - and possibly destroy it from within.

Malpass, 62, is to follow former Bank President Jim Yong Kim, who had resigned unexpectedly. As the largest shareholder, the US is traditionally allowed to designate the candidate, while the Europeans are the head of the International Monetary Fund (IMF). The search was led by Trump's daughter Ivanka - which led some to erroneously suppose that it might be a woman for the first time, such as Indra Nooyi, the former boss of Pepsi.

AP

World Bank headquarters in Washington

"A very special man," said the US president on Tuesday, when he presented his election for the head of the world's largest development bank - which, like all strangers and anything he can not control, is a thorn in the side. "I've known David for a long time."

Although Malpass has a handsome CV, he worked under Ronald Reagan and George Bush. But the nomination promptly caused horror. "An incorrigible arsonist is now our fire chief," tweeted the Liberian ex-politician Gyude Moore.

An incorrigible arsonist now wants to be our fire chief. Man makes his adult life denigrating multilateralism and now has the "pleasure" of running one of it's pillars. When does it end? https://t.co/fMFWaKgN46

Trump smashes institutions by subordinating them to their harshest critics. Scott Pruitt sued the US Environmental Protection Agency (EPA) dozens of times before directing and bleeding it. Energy Minister Rick Perry, former Home Secretary Ryan Zinke and his designated successor David Bernhardt - all also responsible for environmental issues - once worked for the oil industry.

What holds Malpass from the World Bank is no secret, since 2017 he was in charge of them as US Treasury Secretary and never minced words. He insisted on reducing their "intrusive" role in developing countries to the benefit of the private sector. He criticized the salaries and "first-class airline tickets" of employees. He described it as "often corrupt" and as a symbol that harms global growth.

REUTERS

Ex-World Bank President Kim

Above all, he opposed China, which, as the World Bank's largest debtor, created a Pacific competition with the Asian Infrastructure Investment Bank: "China has plenty of resources."

"Malpass will certainly affect relations with China," said finance expert Scott Morris of the Center for Global Development magazine "Foreign Policy." The open question: "What role will its World Bank play?"

There are some steps that Malpass propagated. He urged the World Bank to reform, a capital increase and more transparency. He pleaded for a relaxation of the mission of pure poverty reduction and for a new look at what the Third World really needs.

Malpass' opponents still see a chance

But first, Malpass is committed to Trump's America First doctrine, which has no room for multilateralism. Malpass would ensure, Trump stressed on Tuesday, that the US taxpayers' money flowing into the World Bank serves "American interests."

Malpass' opponents still see a chance to turn things around - a revolt in his election by all shareholders of the World Bank, where the US has neither the majority nor the right of veto. But to do that the Europeans would have to rally against Trump or ally enough states behind another candidate.

For Trump Malpass is already decided thing. In the White House he graciously turned to his wife and children standing next to him, "I want to congratulate you all." As if the whole family had won a TV casting show.