The World Bank’s ambitious plans to rebrand itself as a climate bank, lavishing billions to change the weather, appear to be hitting a snag: nobody knows where the money is going. Up to $41 billion is “unaccounted for,” says anti-poverty group Oxfam International. The bank disputes Oxfam, but Oxfam’s audit is a warning to the bank to get back to its founding mission of fostering development — not meddling in newfangled climate schemes. 

The missing billions came to light in an Oxfam audit that examined the bank’s “climate finance portfolio” spanning the years 2017 and 2023. There’s a gap of between $24 billion and $41 billion in climate funds “between the time projects were approved and when they closed,” Oxfam said. That amounts to some 40 percent of the bank’s climate spending. The group adds that “there is no clear public record showing where this money went or how it was used.”  

It’s “a fundamental breach of trust,” Oxfam’s Kate Donald said. It’s not clear if the “funds were even spent on climate-related initiatives,” Oxfam reported. “The Bank is quick to brag about its climate finance billions,” Ms. Donald said, “but these numbers are based on what it plans to spend, not on what it actually spends once a project gets rolling.” While poor record-keeping is being blamed, the problem appears to be mission confusion.

That’s because the purpose of the bank is a contested point. The institution emerged, along with the International Monetary Fund, to aid the reconstruction of World War II-ravaged economies under the rubric of Bretton Woods’ gold-backed currency system. The bank later expanded its mission, aiming to alleviate poverty in the developing world by fostering economic growth. Now, though, the left wants to shift the bank’s attention to the climate issue.

The New York Times is one the pillars of the liberal establishment utzing the bank to pursue change in the on climate. The bank needs to “do more to step up and tackle this generational challenge,” the Times decreed in an  editorial last year. To that end, the bank will “need to figure out how to raise and leverage the massive amounts of capital that are going to be necessary,” the Times averred, to “mitigate a changing climate.”

The Times subsequently estimated the cost of such ventures at $1 trillion a year. It touted the call of the United Nations’ climate chief, Simon Steill, for a “quantum leap in climate finance.” Yet “the countries that control the World Bank,” the Times fretted, “have not allocated huge new sums for climate issues.” Nor, the Times lamented, has the private sector “stepped in to fill the gap.” What to do, then, but to squeeze more lucre from the World Bank?

A “slow-motion stickup in broad daylight” is how these columns, in an editorial titled “The Great (World) Bank Robbery,” described the push to loosen the bank’s lending rules to gin up more money for climate projects. The bank’s founding agreement bars lending money beyond the institution’s capital. It’s known as the gearing ratio, and for the World Bank it’s one to one. Decades ago, Robert McNamara’s attempt to loosen it was foiled by President Reagan.

Today’s climate militants are more adamant than McNamara ever dared to be. The bank’s new president, Ajay Banga, vows to boost lending on climate financing, even though promoting growth is the best path to lifting up the world’s poorest. Oxfam’s audit discloses the danger of the bank moving too fast on climate lending without adequate safeguards. That’s especially worrisome since American taxpayers are, in the end, on the hook for the bank’s recklessness.