In her first official act as head of the International Monetary Fund, Christine Lagarde Tuesday made two appointments that will be seen as payment to the governments that assured her ascent to the post.
Ms. Lagarde, who was selected over Mexican central bank chief Agustin Carstens late last month, is proposing American David Lipton as her No. 2 at the fund, while suggesting the creation of a fourth deputy managing director that would go to Min Zhu, a former Chinese central banker.
An American has always held the post of first deputy managing director, a quid pro quo for the U.S. backing a European as the IMF's leader.
"David will bring deep experience, personal integrity and a longstanding commitment to public service to the position, and is held in high regard by the international economic community," U.S. Treasury Secretary Timothy Geithner said in a statement.
That's all true. But it will do nothing to erase questions that the real reason Mr. Lipton is getting the job is because the Obama administration opted to reinforce the status quo by endorsing Ms. Lagarde, ensuring the placement of friend close to the decision making at the IMF. (John Lipsky, the current No. 2 who became acting managing director after Dominique Struass-Kahn resigned in May to fight sexual assault charges, is set to resign in August.)
The same suspicions will follow Mr. Zhu. China, an advocate for a stronger voice for emerging market countries at the fund, still opted to back a former French finance minister over a former finance minister from Mexico. On a visit to Beijing during her campaign, Ms. Lagarde indicated that she thought China deserved an enhanced role in IMF management.
Mr. Zhu will be the first Chinese to serve as a managing director at the IMF. He has been serving as special adviser to the managing director since last year.
"As Deputy Managing Director, he will play an important role in working with me and the rest of my management team in meeting the challenges facing our global membership in the period ahead, and in strengthening the Fund's understanding of Asia and emerging markets more generally," Ms. Lagarde said in a statement . "I am looking forward to working closely with Min, David and my other team members."
The appointments of Mr. Lipton and Mr. Zhu require approval of the IMF's 24-member executive board. That apparently is a rubber stamp. Ms. Lagarde's press release doesn't even bother with the conditional tense, stating that both men "will" be excellent advisers.
And they may well be. Mr. Lipton, who is currently an adviser to President Barack Obama, has a PhD in economics and served at the Treasury Department during the Asian financial crisis. Mr. Zhu is a former economics professor who is recognized as one of the world's better economists.