March 16 (Bloomberg) -- Paul D. Wolfowitz, the Deputy Secretary of Defense, will be nominated to be the next head of the World Bank, a U.S. official said.
President George W. Bush will name Wolfowitz later today, the official said. He would replace James Wolfensohn, 71, who said in January that he would leave the institution when his term ends May 31.
Wolfowitz's nomination must be approved by all of the World Bank's member countries, which analysts said would be largely a formality. By tradition, the U.S. chooses the head of the World Bank, and European officials choose the managing director of the International Monetary Fund.
Treasury Department spokesman Rob Nichols declined to comment on the nomination.
Other candidates for the World Bank position included former Hewlett-Packard Co. Chief Executive Officer Carly Fiorina and Bush administration AIDS policy chief Randall Tobias.
Wolfowitz was a strong advocate of the Iraq war, advocating the toppling of Saddam Hussein and helping the administration craft its rationale for the invasion. The U.S. official said Wolfowitz is a proven leader, intellectually and operationally.
World Bank Scope
His management experience running the Pentagon, the largest government agency with nearly 700,000 civilian employees and 1.3 million in uniform will serve him well at the World Bank, the official said.
Responding to a report in the Financial Times earlier this month that Wolfowitz was a candidate for the World Bank, a Defense Department spokesman said he would remain at the Pentagon. ``Secretary Wolfowitz has been asked to stay on in an extremely important job, one that he likes doing very much,'' Defense Department spokesman Larry DiRita said March 1.
Under Wolfowitz, the Bush administration may now try to narrow the focus of the World Bank, returning the international lending institution to its roots of primarily financing large infrastructure projects and limiting the practice of handing out zero-interest loans, analysts such as Alan Meltzer, who led a 2000 congressional inquiry into the World Bank, said.
Management Goal
The lender, the largest financier of projects in developing nations, broadened its scope under Wolfensohn, who sought a more ``humanizing'' role for the bank, according to Joseph Stiglitz, a Nobel Prize-winning professor at Columbia University and former chief economist of the World Bank.
Since taking over in 1995, Wolfensohn cut by 40 percent financing for dams, bridges and infrastructure projects, and shifted that money to programs promoting climate change and development.
The U.S. is seeking to scale back some of Wolfensohn's projects, overhaul the bank's $20 billion a year lending operation and more effectively manage more than 10,000 employees scattered in 109 nations, Meltzer said.
Bush named Wolfowitz, 61, as deputy to Defense Secretary Donald Rumsfeld in February 2001. Then dean of Johns Hopkins University School of Advanced International Studies, Wolfowitz was a veteran of both the State and Defense Departments.
State, Defense Veteran
He served as undersecretary for policy for Vice President Dick Cheney when Cheney headed the Pentagon during the administration of former President George Bush, the current president's father.
From 1986 to 1989, Wolfowitz was the U.S. ambassador to Indonesia, and assistant secretary of state for East Asian and Pacific Affairs from 1982 to 1986. He worked on arms control and disarmament issues in federal agencies in the 1970s.
Wolfowitz was a critic of former President Bill Clinton's approach toward China and Russia, and urged tougher stances on those countries' missile transfers to Iran. He also supported providing international financial assistance to Indonesia during the Asian financial crisis, testifying before Congress that it served U.S. interests.
From 1995 to 2001, Wolfowitz was a director of toy maker Hasbro Inc. He received a Masters degree in administration and a Doctorate in political science and economics from University of Chicago.

WASHINGTON - A closely divided Senate voted Wednesday to approve oil drilling in an Alaska wildlife refuge, a major victory for President Bush and a stinging defeat for environmentalists who have fought the idea for decades.

By a 51-49 vote, the Senate put a refuge drilling provision in next year's budget, depriving opponents of the chance to use a filibuster to try to block it. Filibusters, which require 60 votes to overcome, have been used to defeat drilling proposals in the past.
"This project will keep our economy growing by creating jobs and ensuring that businesses can expand," Bush said in a statement. "And it will make America less dependent on foreign sources of energy, eventually by up to a million barrels of oil a day."
Sen. Ted Stevens, R-Alaska, who has fought for 24 years to open the Arctic National Wildlife Refuge to oil companies, acknowledged it still could be "a long process" before a final drilling measure clears Congress. Lawmakers must agree on the final budget, something they failed to do last year, or Wednesday's vote would have been for naught.
Also, the House did not include an Arctic refuge measure in its budget, a difference that will have to be worked out in future negotiations.
Nevertheless, the Senate made clear by Wednesday's vote that a majority now supports tapping what is believed to be 10.4 billions or more of barrels of oil within the refuge's 1.5 million-acre coastal plain, said Sen. Lisa Murkowski, R-Alaska. Two years ago, a similar attempt to use the budget process to open the refuge failed by three votes.

But that was before Republicans last November expanded their majority, adding a number of GOP senators who favor drilling. Only seven Republicans, all moderates, bucked their party Wednesday and voted with most Democrats against opening the refuge.
Environmentalists said while the vote was disappointing, they haven't given up the fight. "It only strengthens our resolve to protect America's most pristine national wildlife refuge for our children's future," said Larry Schweiger, president of the National Wildlife Federation.
"The battle is far from over," said Lexi Keogh of the Alaska Wilderness League. She said environmentalists will push to keep the ANWR provision out of a final budget document.
The oil industry has sought for more than two decades to get access to the oil. In 1980, Congress said the oil could be developed, but only if lawmakers specifically authorized the Interior Department to sell oil leases. Repeatedly Congress has failed to do so.
Environmentalists for years have fought such development, contending it would lead to a spider web of drilling platforms, pipelines and roads that would adversely impact the calving grounds of caribou, polar bears and millions of migratory birds that use the refuge's coastal plain.
"The fact is it's going to be destructive," Sen. John Kerry, Mass., said during debate on an amendment that would have stripped the drilling language from the budget measure. Democrats fell two votes short of the 51 needed.
Kerry and other drilling opponents argued that more oil would be saved than ANWR could produce if Congress enacted an energy policy focusing on conservation, more efficient cars and trucks and increased reliance on renewable fuels.
Drilling supporters countered that the refuge's oil can be pumped while still protecting the environment and wildlife. (oh yeah, excuse me while I barf over your bald-face lie...)
Modern technology, drilling techniques and environmental restrictions would dramatically limit the industrial footprint that would be left on the tundra and protect wildlife, said Murkowski. "We know we've got to do it right. ... It's a fragile environment."
One GOP senator after another argued that with foreign imports accounting for more than half of the oil the country uses, every available barrel should be pursued. The Alaska refuge represents the largest potential onshore oil find in the country, they said.

But drilling opponents rejected the suggestion that ANWR's oil would have much impact on global markets, today's high oil and gasoline prices, or the continued U.S. reliance on foreign producers.
"We won't see this oil for 10 years. It will have minimal impact," argued Sen. Maria Cantwell, D-Wash. It is "foolish to say oil development and a wildlife refuge can coexist."
Cantwell and other Democrats accused Republicans of trying "an end run" by attaching the refuge provisions to the budget, saying the question of drilling in an ecologically pristine refuge — a "special place" as many environmentalists called it — should be debated as separate legislation or as part of a broad energy bill.
"It's the only way around the filibuster," countered Stevens, defending the use of the budget process. He said that approach is justified for issues that have special importance such as getting at ANWR's oil, something he characterized as a matter of "national security."