Wolfowitz Resigns World Bank Position

Paul Wolfowitz, embattled head of the World Bank, has resigned amid controversy over ethics violations regarding Shaha Ali Riza, his companion. Wolfowitz was nominated by the Bush Administration in March 2005.

Domestically, former Deputy Secretary of Defense Wolfowitz is known as an architect of the US war in Iraq and infamous for underestimating the cost of the conflict. From February 2003:

Mr. Wolfowitz spent much of the hearing knocking down published estimates of the costs of war and rebuilding, saying the upper range of $95 billion was too high, and that the estimates were almost meaningless because of the variables. Moreover, he said such estimates, and speculation that postwar reconstruction costs could climb even higher, ignored the fact that Iraq is a wealthy country, with annual oil exports worth $15 billion to $20 billion. "To assume we're going to pay for it all is just wrong," he said.

Current estimates put the cost of this conflict at more than $500 billion in direct outlays and more than $1 trillion in total. That's just US costs - it does not factor in the cost of innocent lives lost in Iraq.

Insightful comment from Tyler Cowen (tip):

As an outsider it is hard to judge many aspects of Wolfowitz's tenure. I take his continuing unwillingness to resign to be the biggest argument against his managerial abilities. He has lost the public relations battle and can no longer be effective. Why should he want the job any more? The obvious hypothesis is that he is emotionally committed to a losing battle, and is not placing much weight on the long-term interests of the institution he is running.