SFRC Roundtable hearing tomorrow

[TayTay]

Very cool that they are doing these. I like the format a lot and it should be very interesting with this topic.

Senate Foreign Relations Committee To Explore The Foreign Policy Implications of the Global Economic Crisis

WASHINGTON, D.C. -- Senate Foreign Relations Committee Chairman John Kerry (D-Mass.) today announced that on Wednesday, February 11 at 2:30 p.m. in Room 419 of the Dirksen Senate Office Building, the Committee will hold an on-the-record roundtable on the foreign policy implications of the global economic crisis.

The roundtable will explore the foreign policy and national security implications of the economic crisis, as well as the impact the crisis is having on poverty and in the developing world. “The economic crisis we’re experiencing in the United States is being felt around the world, said Kerry.” “We need to understand how far it is likely to reach and what the national security and political ramifications are of a crisis of this magnitude.”

The roundtable will be the second in a series of occasional roundtables at which participating Senators will come from behind the dais and join the guests at tables in the Committee room. This new format is designed to permit greater interaction between the Committee members and the guests and to encourage a candid exchange of ideas. Innovative thinkers will be assembled for a free-flowing discussion on issues of vital importance, with members encouraged to probe, ask questions, and voice their own opinions. In order to make these sessions a vehicle for public education and spur a wider debate, the roundtables will be conducted on-the-record, be open to the public and the press, and transcribed for future reference.

WHO:

Niall Ferguson, Professor at Harvard University and Harvard Business School and a leading financial and economic historian.
Douglas Rediker, Director of the Global Strategic Finance Initiative at the New America Foundation.
Sebastian Mallaby, Director of the Center for Geoeconomic Studies at the Council on Foreign Relations.
Desmond Lachman, Economist and Fellow at the America Enterprise Institute.

[karynnj]

1. "On the record roundtable"

It will be interesting to see how it works on a topic like this - it should be fascinating.

[karynnj]

2. The link doesn't connect to video, but here is the hearing page - it might work later

http://foreign.senate.gov/hearings/2009/hrg090211p.html

[TayTay]

3. It's up now.

Sen. Kerry is talking about doing more of these roundtables and mentions that Ban-ki Moon, UN Sec Gen, will be at a future one.

JK is advocating for openness in recognizing how bad the banking crisis is. We have to prepare people and those in the relevant industries for the massive work that needs to be done to actually help in this financial crisis.

The actions taken by the US must not just bail out shareholders, and we have to focus on recapitalizing the banks and making them solvent.

Now JK is laying out the stakes globally. There are tremendous problems that threaten the security and stability of a lot of govts in the world. So, the US must not just get their own house in order, but deal with the global fallout from the financial crisis.

[karynnj]

9. Thanks - I just turned it on

[TayTay]

4. David Gordon

Head of Research and Global Macro Analysis
The Eurasia Group
Washington, DC

Eastern Europe: (Ukraine, Belarus, Poland, Baltics, etc) These countries are exposed to the financial crisis. This is the first real time these States have faced a crisis like this since the dissolution of the old Soviet system in the late 80's. Which of these Cos will be support3ed by the Intl community and the Euro community. (Ukraine and Belarus will be left out. Hmmmm. Because they do not have a real plan or sense of where they want to go.) Euro is likely to help with the other States. (So, will these other states be Russia dependent????? )

How will these States interact with the West? Which will look to the East (Russia)

So, ah, what is the world financial crisis doing to Russia? Pooten was increasingly negative toward the US. He blames the US for "infecting the world with the crisis." Russia is becoming more authoritarian and is aggragating political power to itself. (Oh uh, this is bad.) Oligarchs are becoming more dependent on the State to do business. (Transcription interrupted by a phone call, sigh.)

Mr. Gordon is struck by the amount of nationalism in the Asian states. (Damn, this is worrisome. We have to preserve the model of the "liberal" state. We don't need xenophobia getting in the way.)

Mr. Gordon not really with the roundtable format yet. This is more like long hearing testimony.

[YvonneCa]

10. When I use this strategy with students...

...they have trouble getting used to 'new rules' for discussion, too. :) They are used to the teacher asking them questions and they respond...and they remain 'teacher-dependent' for a while. Once they figure out that it's okay for THEM to pose questions to each other, they really get into the process.

I agree about Mr. Gordon...so far, he's in hearing mode. :7

[TayTay]

5. Desmond Lachman

Mr. Desmond Lachman
Fellow
American Enterprise Institute
Washington, DC

Predicts that the world economy will contract by 2%. (Damn, just damn.) IMF forecast. This witness (whose name I missed) thinks that is a "sanguine" forecast. It could get worse.

Trade wars, stagnation and economies contracting. Damn, I need a beer.

Yeah, we know Eastern Europe is bad, what about Western Europe. Well, it's not good. This crisis will test the Euro common currency. A lot of the countries are at high levels of unemployment already. Little disputes are popping up. The Czechs are complaining already about French banking withdrawals.

More ominous news: Russia has a currency crisis developing. China is contracting as well, and is now having trouble becoming a domestic economy. (Ah, yeah, that kind of does suck.)

[TayTay]

6. Douglas Rediker, Director of the Global Strategic Finance Initiative at the New America Foundation.

Deficits. We have a deficit of capital, as we all know. T'aint hardly any money out there to be had. The freeze up of capital is affecting govt who can't get money for their programs for their people either, this doesn't just affect business. Lots of countries did what they needed to do to open up world markets and ah are now in deep trouble.

This raises severe questions as to what will happen to the future of the govts in places hard hit. (Which seems to be everyone, everywhere now.) If govt can't provide for their people, what will this do to the form, liberalization and kind of govts that evolve from this crisis. (The key question.) So, what did we learn from the global depression in the 1930's?

Deficits of Capital, ideology, creativy and

[TayTay]

7. Sebastian Mallaby, Director of the Center for Geoeconomic Studies at the Council on Foreign Relation

IMF forecast Is suffering a reduction in growth much less than China and other countries. How do we deal with that?

IMF forecasts for US growth of -1.6%, the second best in the tracked nation, second only to Canada. (Crap. We are bad, but others are worse. ) Among the rich economies, Britain is the worst. Because they had the biggest financial section with NYC and they had a lot less to fall back on in other parts of the country. Britain bet too heavily on finance for growth and lost the bet.

Iran is in trouble because it bet on energy revenues, which have fallen, and they are in trouble. (There is some room to deal with the Iranians. They have lost the economic support they had even six months ago from energy prices.)

IMF has forecast down 4.7% (or so) for Russia. Wow. This is a swing downward from the forecast just 2 months ago. (Energy again?)

I am going to have to come back and fill in the blanks here from where I had interruptions. Interruptions are a natural event, especially when one is married. Sigh!

Guys, it's a roundtable, shorter presentations.

The world is saving too much at a time when they need to spend to get capital out there.

BTW, IMF info here: http://www.imf.org/external/pubs/ft/survey/so/2009/NEW020709A.htm Yes, it's very worrisome.

[TayTay]

8. Niall Ferguson, Professor at Harvard University

Chi-merica. (China and America.)
Doesn't believe the IMF predictions. But, if they are right we're not, yet, in a great depression. (Whew!) If we avoid a GD, then it's because govts are trying to inject stimulus into their markets.

Ok, the US: We don't know if the stim package will work. The US will borrow about $2 trillion. We are into War fiscal policy without the war. (the last time we had this number was WWII.) (Ah, we do have a war, but it is not doing stimulus like in WWII)

Doesnt' think these 3 thinks are true
1: This crisis has destroyed the legitimacy of the US as a leader
2: speed up the convergence of East and West
3: The Us dollar will lose it's primacy.

Not true because
1: Obama changes the equation and creates better feeling globally
2: Not sure
3: The dollar is not dying. The US really is a safe haven and is stable. The US will not have major political change because of the financial crisis.

World trade has collapsed by 1/4. Wow. This is a crisis of globalization. (Big wow to hear someone say this.) And it hurts others more than the US,. (Hey, look at China and the bet it placed on exports. Hmmmmmm.)

China and Russia have an opportunity for power. They have their problems right now, but there is a chance that they can rise to challenge US dominance. (See World history for more.)

Big loses: Japan, South Korea and Taiwan.
EuroZone is not going to break up because the cost of that is too high. But the strains will show.

We must not do things that push Russia and China closer together. We need to keep Chi-merica going. hmmmm.
Ferguson doesn't want defense spending cuts. He specifically said that he wants more money for IT security and thinks there is a bigger return on that than on building bridges.
He is, relatively speaking, the optimist of the group.