The fundamental issue for governments, and their protégé’s, quasi-government organizations(QGO) like the World Bank, IMF and the UN, is one of accountability, or what goes by the QGOs fashionable phrase of “corporate governance”. Corporate governance is ensured in the private sector via the market. If a firm is perceived to even have a shade of corporate mis-governance, the highly competitive international marketplace is very quick to penalize it. To ask for corporate governance in today’s competitive international world, for publicly listed firms, is like mandating rules that a politician has to campaign – she will do so because it is in her self-interest to do so.

However, it is not amusing to note that corporate governance is asked for by "firms" which need it the most, and for whom the market discipline is absent i.e. the GO's, QGO's and their lesser brethren, the NGOs. Institutions like the World Bank prescribe policies for governments - policies that affect freedoms and lives of entire populations, poor and non-poor. The knowledge that such institutions possess, and the human capital of their staff, is nothing short of brilliant, and certainly something that governments of most developed economies cannot match, let alone governments of most poor economies. Thus, and not inconsequentially, the research at these institutions also carries with it a stamp of authority - it comes with the turf. Hence, the necessity for checks and balances, or "market governance" of QGOs is immensely important.

It is in this accountability sphere that the recent mis-steps of one QGO - the World Bank (WB) - needs to be examined. This institution pioneered research on global poverty, and each year publishes "evidence" of where the world is in its war against poverty. The main complex of the World Bank in Washington, DC welcomes you with the slogan "OUR DREAM - is a world free of poverty". But, according to various documents published over the last few years, and evidence reported in its flagship publication, the World Development Report, the dream has turned into a nightmare - the last eleven years, 1987-1998, have shown an increase in the numbers of the world poor, from 1183 million in 1987, to 1199 million in 1998.

The World Bank points out that these eleven years were witness to high economic growth; the two largest economies, China and India, who between them contained more than half of the world's poor in 1987, had per capita income growth rates exceeding 7 percent a year (China) and 4.5 per year (India). Thus, as economic growth has accelerated, poverty reduction has slowed down. What the World Bank does not point out is that, according to its own household survey data, there was no growth in per capita incomes in the developing countries. The correctly stated WB "facts" show that there was no economic growth, and no poverty reduction. How? What the "poverty numbers" monopolist, the World Bank, did was to take economic growth data from a source (national accounts data) which showed that there was large economic growth, and reported poverty numbers from a separate source (household surveys), which showed there was no poverty reduction. Content is not king - ideology is.

The draft WDR correctly reflected the prevailing World Bank (read senior management) ideology about what needs to be done for alleviating world poverty. Economic growth is neither necessary nor sufficient; the "new" mantra is "empowerment" of the poor; the growth process is highly uneven in the developing world; economic liberalization is conclusively proven not to be a solution; so called market-friendly policies have failed; the poor in developing economies need to be empowered in order that they can rightfully claim their share of the resources. etc.

Thus, governments have to pursue policies independent of those which generate growth; in order to reduce poverty, better targeting of the poor is needed; the role of governments (and the World Bank) has to be expanded. "Actions at the global level, by regional and international organizations…are essential to ensure that the gap between the rich and the poor does not continue to grow". Income redistribution should be an important aspect of policy. "The best actions for poverty reduction are those that moderate economic growth and encourage the rich to share their bounty with the poor". "Actions that force too rapid an integration into world markets are good for neither growth nor poverty reduction. Until the preconditions for beneficial integration are in place, countries should open up to trade and capital flows cautiously". (all quotes from draft of WDR, 2000; emphasis added).

The lack of accountability at a QGO is complete - the facts cited are selective and seemingly tailored to fit; flagship publications like the WDR do not consider it necessary to provide evidence for assertions that growth is ineffective and/or that trade and capital flows can be counter-productive for the poor; indeed, considerable evidence on trade, and new (but limited evidence) on capital flows suggests the opposite conclusion.

The lack of substantiation of the revisionist ideology led many critics to dismiss the proposed WDR. Most were in agreement with T. N. Srinivasan's view that the WDR was not even fit for a dog's breakfast. Those who believed that growth is in large part necessary for poverty alleviation were winning over converts, precisely because the WDR was so awful in proving the opposite point of view. It is likely that the report's leader, Mr. Ravi Kanbur, and his mentors realized that the WDR ideology was in a no- win situation and converted a virtual write-off into a write-in. Mr. Kanbur, in an unprecedented fashion, resigned as head of the WDR, stating that he was being pressurized to state heretical views like "growth matters".

By allowing this resignation to happen, it will now be impossible for non-growthwallahs to be won over by reason. "If you believe that evidence was strong on the growth side, then why censor somebody's research - and censure him to the point that he is forced to resign". Now there is doubt. If everybody wanted Mr. Kanbur removed, or wanted to censure the report, or rewrite it, maybe it had something positive to say! The anti- growthwallahs maybe misguided, but they are not stupid. The only way they could hope to live to fight another day was by having their lead representative resign - better to be a martyr, than to be defeated by reason, and evidence.

Regardless of the views expressed, there seems to be little reason to censor the document, or its lead author. Much better for the report to be attacked, or praised, in an open forum. By creating conditions fruitful for a resignation, the World Bank has ensured that any criticism will be (wrongly) associated with the view that it was correct to censor Ravi Kanbur, and/or his no-evidence-is-necessary report on the state of world poverty.

The only "corporate governance" response was to allow research to be openly debated; modification, subtle "coercion" to change one's views, or prevention of publication, are now the (almost) exclusive preserve of the public sector. The very same sector that invokes the slogan "In the name of the poor" before announcing policies that will not help the poor. But it helps to assuage one's guilt, and one's pocket book. Poverty is Big Business; if you don't believe me, just ask the World Bank.