How is the American government reacting to the news that the United Nations oil-for-food program was a cesspool of corruption and that the U.N. was funding anti-Israel propaganda during the Gaza pullout? It has sweetened the terms of the $1.2 billion loan it is offering the United Nations. The funds are to be used to construct even more palatial offices from which the bureaucrats can launch their corrupt anti-Israel and anti-American schemes. Our Meghan Clyne broke the story in Friday’s New York Sun. Her scoop was confirmed that day by a press release from the U.S. Mission to the United Nations – the American State Department – reporting that the terms of the loan had been improved to 5.35%, from 5.54%.

What better indication could there be of the bizarre upside down world of the United Nations? With interest rates rising for ordinary American borrowers, they are dropping for the lucky ducks at Turtle Bay. Why the American taxpayers should shoulder this burden is beyond us. If the idea is to buy some goodwill for the Bush administration and Ambassador Bolton at the United Nations in advance of the General Assembly, it strikes us as misguided. True, the Volcker Commission and Saddam Hussein have already proven that the United Nations is subject to being bought off. But it doesn’t logically follow that America has to respond by entering into the bidding war.

Any enterprising senators or vice presidents watching this situation unfold can only wonder whether that $1.2 billion below-market-rate loan might be better used as startup funds, for, say, the democratic opposition in Syria and Iran, or civil society in Red China or Russia. Certainly plenty of Americans will have little difficulty imagining better uses for the funds. If the U.N. needs a loan, there are plenty of banks in New York that can decide whether the world body is creditworthy without relying on the American taxpayer to subsidize the deal.