Rebuilding Iraqi banks challenges Peru RPCV McPherson
Read and comment on this story from the Lansing State Journal on Peru RPCV Peter McPherson and the challenges he will face as the top financial adviser for the U.S. government's reconstruction of Iraq. The challenge that awaits him in Baghdad is that the currency is shot, banks are in chaos and the economy has crumbled in the wake of war and Saddam Hussein. "The banking system is virtually nonexistent,'' McPherson said. "Even many of the institutions are literally at ground zero,'' having been destroyed in the war. Read the story at:
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Rebuilding Iraqi banks challenges McPherson
MSU president now officially top adviser for financial matters
KEVIN W. FOWLER
For the Lansing State Journal
EAST LANSING - MSU President Peter McPherson says universities should strive to make a difference in the world.
That's what he aims to do in Iraq for the next 130 days.
McPherson, 62, was officially tapped Friday morning as the top financial adviser for the U.S. government's reconstruction of Iraq - a move anticipated for more than a week. Michigan State University trustees granted him an unpaid leave of absence at a hastily arranged meeting later in the day.
Provost Lou Anna Simon will be interim president until McPherson's return, expected this fall.
McPherson - the longest-tenured president in the Big Ten Conference - has made global study a priority since arriving at MSU in 1993. But he was an acknowledged expert in international banking and foreign affairs long before he arrived in East Lansing.
"It's the dimension of the problem,'' McPherson said Friday, explaining what prompted him to pack for Baghdad - where he expects to be within a few days. "It's the real possibility of making a difference.''
McPherson temporarily leaves behind a mounting financial problem in East Lansing; the strained state budget threatens university funding across Michigan.
The challenge is nothing like what awaits him in Baghdad - where the currency is shot, banks are in chaos and the economy has crumbled in the wake of war and Saddam Hussein.
"The banking system is virtually nonexistent,'' McPherson said. "Even many of the institutions are literally at ground zero,'' having been destroyed in the war.
Accepting challenge
McPherson has dealt with international financial problems before.
He oversaw the management of $8 billion of debt as a Bank of America vice president, working with Canada and countries in Latin America, before taking the MSU job.
In the 1980s, McPherson dealt with international trade and tax issues as deputy director of the U.S. Treasury. And he managed a $6 billion-a-year program involving 70 countries as an administrator for the Agency for International Development.
Reconstructing Iraq's mangled economy will likely be a tougher task than any of those. But McPherson said he will borrow from lessons learned in recent international efforts rebuilding Bosnia and Afghanistan after conflicts there.
Iraq - a nation of 24 million people - faced economic scandal and secrecy during the Saddam years. Among McPherson's first challenges will be figuring out where the regime's money is, how it should be spent domestically, and how much of it is owed to foreign countries. He also wants to strengthen the nation's banking system.
McPherson's broad experience makes him the right man for the job, supporters say. So does his work ethic, forged on the family farm while growing up near the west Michigan town of Lowell.
"All the guy does is work,'' Trustee Joel Ferguson said. "He doesn't go home when he's supposed to. And since his wife (Joanne) isn't going with him, he'll be at work even longer.''
The game plan
The good news: U.S. troops are finding lots of money, gold and jewels in Iraq, much of it stashed in Saddam's family hideaways. And as one of the world's largest oil producers, Iraq should have steady income.
McPherson said Iraq will be helped by its relatively high literacy rate and number of college graduates.
"This can't be just Americans coming and saying 'This is what we're going to do,' '' he said. "It must be done with and for Iraqis.
"They don't know you. You don't know them. But we'll work together.''
McPherson is assembling an economic team to help rebuild Iraq but admits he doesn't know exactly what awaits him in the Middle East. He doesn't even know where he'll be staying.
But MSU's president insists he's coming back to East Lansing - a sentiment he said was reinforced upon his arrival home from a briefing in Washington, D.C., Friday.
"It's such a beautiful campus,'' McPherson said. "I have a deep affection for this place ... a deep commitment. And there's a whole lot more work we're going to get done here.''
Contact Tim Martin at 377-1061 or tmartin@lsj.com. Click on a link below for more stories on PCOL
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