The way it was initially reported and the way it has been spun is dispiriting. I don't know enough about it to really defend Wolfowitz, but if it's true (1) that he disclosed the relationship when he came aboard, (2) that he acted promptly to transfer the lady out of range of a conflict of interest, (3) that he simply rubber stamped the World Bank's buyout package, and (4) that the Board and other relevant Bank officials were apprised of what was going on, he probably should be ok.
If all of the above is true, the complaint would then be that, instead of rubber stamping the financial package himself, he should have recused himself so that his deputy could rubber stamp it. I don't suppose I would hang him for that. The key, however, is whether the Board was in the loop.
Now that I'm thinking about it, I believe I'd take the view that if Wolfowitz has to go, anyone on the World Bank board or in a senior staff position who knew about it and didn't blow the whistle should also be canned. Gotta be consistent.
The documents Fox provided links to should clear up that the scenario you outlined is exactly the case. When will people learn that the MSM is simply megaphoning the bureaucrats and Dems’ lies about the Bush appointtees. At least wait a day or two for the truth to catch up with the lies before making a judgement.