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The Soon Coming Judgment Of God Upon America and How To Escape It 135
Some nations have benefited from loans but the vast majority have become worse off. In
1991 an internal World Bank report was leaked; the report revealed that over a third of the bank
projects completed that year were judged failures by the banks own staff. Over the previous 10
years the bank had seen the failure rate dramatically escalate by 150 percent.
A high-level internal audit team had come to similar conclusions. They released a report
entitled “Effective Implementation: Key to Development Impact.” The report was prepared for
the Bank's president by Willi Wapenhans. The report was based on 1,800, then current, Bank
projects for which the bank had lent $138 billion. Policy makers from a number of the 113
nations who had current projects in construction were interviewed for the report.
The report noted that the project failure rate among completed projects had escalated
dramatically between 1981 and 1991. The failure rate went from 15 percent in 1981 to 30.5
percent in 1989 and then to 37.5 percent in 1991. The “Bank staff also said that another 30
percent of the projects in their fourth or fifth year of implementation in 1991 had major
problems. The worst affected sectors were water supply and sanitation, where 43 percent of the
projects had major problems, and the agricultural sector, where 42 percent of the projects were
failing.”
443
Poor World Bank investments drag down the whole economy in the recipient nations.
Since loans only go to governments, the loans, whether successful or not, lead to bigger
government, which in turn leads to bigger government payrolls, higher taxes and more
government intervention into the private sector. All these only put additional strains on
struggling economies; the higher taxes further burden those who are poor and hungry.
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Imagine that you borrowed money to build a house but were never able to inhabit it. You
could consider several reasons that might be typical of failed development projects. The house
was built in an inaccessible area; or it could be because it fell down when you were finished
building; or that although you exhausted your money, it was never finished. If your imagining it
was never finished, imagine further that being exposed to the weather it rotted and fell down. In
any of these cases, how would you pay back your loan? Because you had no house to live in, you
would have to rent one. Even worse, you may be forced to live on the street. These poor nations
are facing huge debts and they often have almost nothing to show for it, their taxes have gone up,
their wages down and their economies have faltered. If the United States, the richest nation in the
world can’t pay off its own national debt, how will these poor nations ever do it? They simply
won’t be able to.
The very policies of the World Bank and IMF are designed to bring a high failure rate to
the projects they fund. When a project fails, the citizens of the nation are still accountable for the
debt but they end up getting nothing in return. Kevin Danaher recognized that the Banks policies
are a major part of the problem and that the result is a “the steady transfer of wealth out of Third
World countries to the bankers of the industrial countries.” He wrote about it in his book,
50
Years Is Enough: The Case Against The World Bank and the International Monetary Fund, he
states:
The unwritten goal of the World bank and the IMF—one that has been
enforced with a vengeance—has been to integrate countries into the capitalist
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