McPherson to lead financial repair of Iraq

February 21, 2007

MSU President M. Peter McPherson will join coalition efforts to restore the Iraqi government.

McPherson met with the Bush administration in Washington on Thursday to discuss the financial reconstruction of Iraq.

The university president obtained financial experience while working second in command for the U.S. Department of Treasury under former President Ronald Reagan.

"It is true that the White House has been talking to Peter about some sort of borrowing of him for work in Iraq for the next couple months," MSU Trustee Colleen McNamara said, adding McPherson "may be back by the beginning of fall term."

It is unknown when McPherson will leave for Iraq and MSU spokesman Terry Denbow said the president has no plans to permanently leave MSU.

In January 1999, the MSU Board of Trustees offered McPherson a position as a senior consultant, making him eligible for retirement status. He has to remain president until 2003 under the deal, which will pay half the average of the five highest deans or directors.

Provost Lou Anna Simon will act as MSU's interim president during McPherson's absence. Simon did not return repeated phone calls and McPherson declined comment Thursday night.

Thursday morning, McPherson told Peter Magrath, president of the National Association of State Universities and Land Grant Colleges, he plans to leave MSU for at least two months to take part in the rebuilding of Iraq.

In the past month, Iraq has seen major warfare followed by civilian looting and mayhem. Coalition forces have set up a temporary government run by the U.S. military.

McPherson's future duties in Iraq aren't clear, but economics Professor Charles Ballard said the task of rebuilding Iraq's economy won't be easy. Iraq owes hundreds of billions of dollars in unsettled debts and claims to several countries.

Ballard added McPherson's experience at the Bank of America dealing with indebted Latin American countries such as Peru will help in negotiating Iraq's finances.

Ballard said expecting McPherson back at MSU by the fall is optimistic.

"If the job of restoring Iraq's financing could be completed in that time that would be quite an accomplishment," he said.

The White House has not made an official announcement of the appointment and many MSU officials have deferred comment until that happens.

The board will hold a public meeting at 9 a.m. today in the Administration Building's fourth floor boardroom to examine how to proceed without McPherson, McNamara said.

Despite McPherson's absence, the board still will need to handle upcoming budget cuts, maintain a $1.5-billion fund-raising campaign and continue to compete for a federally funded Rare Isotope Accelerator this summer.

Michael Perez, co-founder of Students for Peace and Justice, said he was concerned about what kind of statement McPherson's new role would make for the university.

"By doing this he's taking a stance on the war by approving it indirectly or tacitly," the anthropology graduate student said. "It's a smack in the face to the student body who took a stance against the war."

The university can expect student opposition and demonstrations as a result of McPherson's decision, Perez said.

McPherson's background in international financial relations makes him a top pick for running the new Iraqi government's treasury department.

"I, over a number of years, had a broad range of financial management experiences that clearly are helpful in thinking of (university) issues," McPherson said in an interview last month.

From 1989 to 1993, McPherson served as group vice president of the San Francisco-based Bank of America.

He was responsible for the bank's work in Canada and South America and for managing the "bad debt portfolio" - an international portfolio of debts totaling $8 billion.

Previous to McPherson's work in the Bank of America, he was deputy secretary of the U.S. Treasury Department under Reagan, serving as one of three negotiators for the Canadian Free Trade Agreement.

Six years previously, McPherson was an administrator with the Agency for International Development and led a year-long delivery of more than 2 million tons of food to Africa during a famine in the mid-1980s.

He also was a special assistant to President Gerald Ford and director of the White House Presidential Personnel Office from 1975 to January 1977.