Failing Upward, Version 3,452,227 (aka the Wages of Nearly Bringing Down the Global Economy)

Corporate American, and apparently important agencies, much prefer to hire people who’ve had Big Jobsno matter how poorly they’ve performed in them, that are very similar to the one at hand, rather than hire someone who relevant skills and experience but for whom a Big Job would be a step up.

You cannot make this up. From the Banking Times, “Ex-Lehman chief risk officer appointed World Bank treasurer,” hat tip Richard Smith:

The World Bank has appointed Madelyn Antoncic as its new vice president and treasurer.

Ms Antoncic served as Lehman Brothers’ chief risk officer from 2002 to 2007 and following the collapse of the bank, stayed on for a year as managing director and senior advisor at the Lehman Estate, helping to maximise value for creditors…

In her new role, Ms Antoncic will be responsible for maintaining the World Bank’s standing in financial markets and for managing an extensive client advisory, transaction, and asset management business.

She will also lead seven Treasury business lines as follows: the Capital Markets Department; Investment Management Department; Pension & Endowments; Quantitative Risk Analytics; Treasury Operations Department; Banking & Debt Management, and Sovereign Investment Partnerships.

Commenting on the appointment, World Bank Group president Robert B Zoellick, says: “Known for her forthrightness, I am delighted Madelyn is taking up this important role.”

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  1. RueTheDay

    “In her new role, Ms Antoncic will be responsible for maintaining the World Bank’s standing in financial markets and for _____managing an extensive client advisory, transaction, and asset management business_____.

    Wait, what?????

    I always thought of the World Bank as 1) being the funding arm of the IMF and 2) being responsible for funding development projects in impoverished countries.

    The above passage makes it sound like they’re a private investment bank.

    1. Yves Smith Post author

      They set up capital markets in developing economies (!) to make the world safe for investment banks and more recently have sponsored funds in developing economies.

      1. ambrit

        It sounds just like the “old” AID, building infrastructure around the world to facilitate Big Business.
        This the Peter Principle on Steroids.

    2. Jim Tarrant

      There’s a vast difference between the development side of the WB, though that also has a lot of problems with country quotas and appointed hacks and the money side. Yet, in general, the WB has had pretty good managers overall. I assume that the investment side, as with the IFC and IMF is totally inside baseball and that we shouldn’t expect to see honesty and accountability on board. Also Zoellick was a Bush appointee so we can’t expect a Wolfenson level of quality.

  2. Moopheus

    How desirable is a job like that? I mean, for someone with the right skills ‘n stuff. And not corrupt and incompetent. Would they really want that job or are there better options? Is the World Bank really a competitive employer? Or are ex-Lehmanites looking for rehabilitation the best they can do?

    1. Yves Smith Post author

      First, income to employees of the World Bank is free of US income tax.

      Second, they get very lavish pensions for public officials, which given that their income when working was tax free, I would assume their retirement pay is too. I don’t know if she is young enough to get in 20 years of service, but a colleague left after what I am pretty sure was 20 years of service ~ 2007, to a $160,000 per year pension. And if she had stayed four years longer, her pension would have been $220,000 a year. And she had serious health problems for a number of years (chronic fatigue syndrome) and they were VERY accommodating about her working hours. She was not able to work full time and yet they kept her on full time pay. Pretty much no private sector employer would have done that.

      Third, even if she decided to quit before hitting the lavish pension stage, she would be a prime candidate for board seats and speaking gigs.

    2. craazyman

      what skills?

      there’s probably about 3,452,227 people worlwide who could do the job, if they had about 4 weeks of on-the-job training.

      Too much nausea for one day. I need another glass of Merlot and it’s only 6:30. Glad I ran 4 miles today, at least I don’t feel guilty. Maybe even a piece of chocolate cake after this Post.

  3. Valissa

    “All experience teaches that, whenever there is a great national establishment, employing large numbers of officials, the public must be reconciled to support many incompetent men; for such is the favoritism and nepotism always prevailing in the purlieus of these establishments, that some incompetent persons are always admitted, to the exclusion of many of the worthy.”
    — Herman Melville

    Cronyism, favoritism, and nepotism have always been factors in human societies. Their opposite is the ideal of meritocracy, which has also always been with us. It’s the ratio between them that varies over time depending on historical conditions.

    Currently there is the appearance that meritocracy is on the downswing and it’s opposites on the rise. I’m not sure if that’s true or if it merely appears to be true because so many are out of work and paying closer attention to how the system operates.

  4. DavidE

    She already has the proven ability to overlook any and all possible risks. What more could you ask for?

  5. bob

    This may seem strange until you remember that Robert Zoellick is the head of the organization, preceded by Paul Wolfowitz.

  6. spark

    Let ’em push our supposedly meritocratic social hierarchy until it breaks!

    Sooner or later, the serfs wake up one morning and the “divine right of kings” looks like nonsense.

  7. ECON

    As per “Too Big to Fail or Too Big to Change” (The Harvard Law School Forum) the banksters have secured a pass on their fraudulent and criminal activities. No surprise that the ex-Lehman executive risk officer ends up with World Bank.

  8. Skippy

    World Bank…equals…Bond Holders with a Difference Bank.

    Skippy…Personally I believe she is the logical / rational choice. Risk Analytics is / has become the *Art of Obfuscation* ie. not all risk is the same…cough…day light must never *shine* upon___certain facts___or the party is over…eh.

  9. Hugh

    Robert Zoellick, there’s you problem right there. He was at Goldman Sachs, was a founding neocon and member of PNAC, was Baker’s lieutenant directing the Brooks Brothers riots during the 2000 recounts in Florida. He is a bigtime free trader, mercantilist, gold standard supporter, and promoter of GM foods. The guy is in other words totally toxic to the wants and needs of ordinary Americans and a complete creature of the Wall Street kleptocrats.

    I mean to give some idea of what a corrupt enterprise the World Bank is Paul Wolfowitz was Zoellick’s immediate predecessor.

    Appointing Antoncic, after what should have been her career destroying tenure as Lehman’s chief risk officer, is just a display of arrogance by our kleptocratic overlords. The scary aspect of this is that from their point of view Lehman blowing up was less a disaster than a golden opportunity. So why would they punish someone who did so much to make it possible?

    1. DavidE

      She is getting favorable reviews as a “white hat” because she complained in 2007 that Lehman was taking on too much risk. Where the heck was she when Lehman was offering subprime and Alt-A mortgages which they did throughout her tenure there?

  10. rps

    Peter Principle doesn’t discriminate. Perhaps Mary Shapiro will bake her cupcakes too as she did Gary Gensler. The exclusive Harvard, Princeton, and Yale club members of incompetence is selective in their membership, “Elite failures need only apply”

      1. ante Yale

        Doesn’t Stephen Roach teach this course at Yale?

        Morgan Stanley did get more than 2 trillion in Fed bailouts…

  11. chris

    Wow, what has happened to our world? I there anything a corporate executive can do that would not get the hired at another job? Example…was in Nardeli robert nardeli maybe not sure how to spell it but his near destruction of home depot landing him a new job at chrysler maybe…..but it was as if he couldn’t do enough wrong at home depot to keep him from getting another high paying executive job….. it is insane as we try to tell our school teachers they are going to be evaluated, hired and fired based on performance when no one corporate america or the government follows those standards…..

  12. Capo Regime

    It will only get better as Hillary Clinton takes on the presidency of the world bank. What with her failing the D.C. bar, her distinguished legal career in Arkansas, amazing stint as a U.S. senator (all that brilliant legislation) then a secretary of state for the ages. Only logical that she join other clods. I can see hear her speech now: “Ummm, you know, I am you know excited to join Madelyn you know at the world bank were we will ummm, work on importan issues to umm you know, make the world better”, I think all options are on the table you know as I and Madelyn, lead the bank to um you know new challenges….. and more incoherent strung along words and platitudes follow. Ugghh.

  13. Doctor Stock

    You’ve Got To Be Kidding ME? Promise me, you are, right? Once again I’m reminded of how the “professionals” and “experts” and so-called “economists” often are like weather men… their forecasts are rarely right, but they have lots of experience in knowing what went wrong… but they still can’t change the future.

  14. H. Alexander Ivey

    Her apointment is another confirmation that ppl tend to choose based on their social level, not their economic or “rational” interests (an idea suggested from reading this site over the years). Perhaps we choose rational – merit – interests when our social level is visibily disappearing. The World Bank and their social status is in no threat of disappearing.

  15. Mike G

    Rule #1: There is a club.
    Rule #2: You are not in it.
    A colossal screwup at a previous job would kill your career if you were not in the club. When you’re in the club, you get shortlisted for plum positions simply because you are in the club. Accountability and performance standards are for the little people.

    Currently there is the appearance that meritocracy is on the downswing and it’s opposites on the rise.

    George W Bush in the White House was the equivalent of a punch in the face to “the appearance of meritocracy.” The neocon-run Coalition Provisional Authority in Iraq took it out back and thrashed it half to death.

  16. SJWise

    The other night I saw Ray Nagin (former New Orleans mayor) on the Daily Show hawking his book. He actually said he was doing consulting on disasters. The worst is “Heck of a Job” Brownie also said he was doing disaster consulting on some show a couple of years ago. So I guess the way to become an “expert” at something is to totally screw it up.

    Hence Greenspan’s economic “expertise”.

  17. JerryDenim

    DavidE already beat me to it, but yeah of course. She’s perfect for the job.

    An organization who’s primary function is to give predatory loans to developing economies could really have their party pooped on by a effective, outspoken and conservative risk manager. It’s much better to have a useful idiot with credentials when all you want to hear is “yes”

  18. readerOfTeaLeaves

    Relevant to this post: “DebtOCracy” with English subtitles now available (free) online at the Real News Network’s website.

    Definitely worth viewing. Powerful stuff, and a sign of international contempt and disgust with Global Finance. Very compelling.

  19. Psychoanalystus

    Look at the bright side: if she can do for the World Bank what she did for Lehman Brothers, then she is indeed an excellent choice…

  20. Schofield

    God foresaw that there would be a Divine Right of Emperors of the Universe Agency Problem and inserted Cooperative Counter-Dominance. Namely the unemployed who would have the time to figure what the f..k is really going on.

  21. DavidE

    Citigroup exec was arrested for embezzeling $19 million from that bank. His response when arrested: “I was just taking an advance on my bonus. I didn’t think they prosecuted bankers for taking money from the bank.”

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