BY SEAN HEALY

Leaked internal correspondence has revealed a deep crisis of morale in the World Bank, with staff fearful of being humiliated by top executives or of being made redundant, incensed at being forced to compete against each other in the bank's “internal market” and resentful of bank president James Wolfensohn, who has been accused of being arrogant, dictatorial and “isolated from reality”.

Wolfensohn had asked the bank's 8,000 employees in its Washington, DC, headquarters to respond to his view that “mistrust and lack of team spirit” as well as “malaise” pervade the institution.

The response was an outpouring of recriminations, many targeting Wolfensohn himself.

One email, written by a member of the bank's Middle East and North African department, said Wolfensohn was “quick to rebuke and humiliate managers, often in open meetings ... He does not practice the values and behavior he espouses for the rest of us ... Managers at all levels live under fear.”

The bank's internal market, the system by which departments charge others for services rendered, also came under fire, one staff member calling it “a source of competition, hostility and huge transaction costs”.

Bank spokesperson Caroline Anstey admitted that a fear of downsizing was contributing to the morale problems — 300 jobs have been cut in the last six months. “What you are seeing now is a great sense of insecurity, with some staff genuinely fearful for their jobs and some push-back from those who resist change,” she said.

There have been no promises from bank spokespeople of a review of the World Bank's pro-competitive advice to borrower countries — surprising given how stunning the failure of such policies within the institution itself has been.

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