Who’s Afraid of the Asian Infrastructure Investment Bank?

This week, Germany, France, Italy, and the U.K. all signed up to join the Asian Infrastructure Investment Bank. The AIIB, a Chinese-led multilateral fund with about $50 billion in capital to invest in public infrastructure, is opposed by the U.S. because it will compete with institutions where America has considerably more influence—organizations such as the World Bank and the International Monetary Fund. An Obama administration official complained about “constant accommodation” of China by the U.S.’s European allies, and the president’s National Security Council issued a statement expressing concern over the AIIB’s environmental and governance standards.

The complaints, however, ring hollow. Washington has singularly failed to play its part in building up the capacity of existing multilateral institutions, including the World Bank and the IMF, while blocking attempts by the rest of the world to fill the gap. If the Obama administration can’t get Congress to put up the cash required, it should at the very least get out of the way of other countries willing and able to lead on multilateral expansion and reform. International financial institutions are too important to global growth and stability to be held hostage by America’s inflated sense of entitlement.