BUSH, BARACK, AND THE MELTDOWN
Kathryn C. Lavelle - Ellen and Dixon Long Chair in World Affairs and Associate Professor of Political Science at Case Western Reserve University
Friday October 9, 2009
Clark Hall 206
Case Western Reserve University
We will be meeting in a different location this week. (Baker-Nord Room, 206 Clark Hall) There will be no parking in the visitors lot next to Crawford Hall on October 9th.
As two wise scholars once said, “every government would bribe business to bring prosperity, if only it knew how.” As they did not think to say, “every government would keep the financial markets from doing incredibly stupid stuff that screwed up the economy royally, if they only knew how.”
Dealing with the economy is a tough job for politicians. Knowing how, unfortunately, has two dimensions: knowing what economic activity makes sense, and having ways to influence it. Each is problematic. Politicians may share the same beliefs that lead to unwise market behavior; but even if they do not, they may for many reasons feel unable to prevent that unwise behavior. Politicians face a catch-22: it’s good if markets go “up,” but that supposedly depends on “market confidence,” which in turn may depend on the same silly beliefs that can lead to bubbles and crashes. Prudent measures may reduce confidence and so lead to the same results they are meant to prevent -- a crash, or at best stagnation.
The Bush administration had first crack at the economic crisis caused by the financial market meltdown; now the Obama administration is trying to cope. How have they done? What should they have done different? What has been the role of Congress in the response? How is the Obama administration’s understanding of the economy different from the Bush administration’s? And how has each been constrained by both political and economic forces?
Kathryn C. Lavelle is especially qualified to understand how governments deal with financial markets. Her work focuses on the politics of building markets and regulating financial arrangements around the world. For two of the last three years, she was on leave in Washington DC. In 2006-07, as an American Political Science Association Congressional Fellow, she worked on the staff of the House Financial Services Committee for chairman Barney Frank. In 2008-09 she was a fellow at the Woodrow Wilson Center, working on her book about how Congress and international financial institutions seek to influence each other. So she has had an especially good vantage point to observe how both the Bush and Obama administrations have addressed financial market issues.
The discussion will be moderated by Ken Grundy, as I cannot attend. I can’t help but make one remark, however, that perhaps Professor Lavelle can address.
When government leaders feel their fate depends on “confidence” within financial markets, then they might feel they have to comfort the actors who’ve done the stupid things that put the economy in a mess in the first place. A critic would say that these are the only evident justifications for appointing the head of the New York Federal Reserve Bank during the greatest market mess-up since 1929 as Secretary of the Treasury, and a Secretary of the Treasury who championed deregulation as chief economic adviser, and reappointing a Federal Reserve Chair who has been less than effective.
But perhaps Professor Lavelle, or others in the gathering, have a more optimistic view….
About Our Guest
Kathryn C. Lavelle’s ongoing research concerns the intersection between domestic and international politics in the issue-area of finance. Her forthcoming book analyzes the relationship between the US Congress and the International Monetary Fund (IMF) and World Bank by focusing on the activities of public and private sector interest groups on issues related to global capital flows. In 2008-9, she completed the research and drafting of the project as a residential fellow at the Woodrow Wilson International Center for Scholars in Washington, DC. The framework builds on her experience in the 2006-7 academic year as an American Political Science Association Congressional fellow, where she worked on the staff of the House Committee on Financial Services for Chairman Barney Frank (D-MA).
Given the extraordinary events in domestic and international financial markets that have occurred since she began the project, Dr. Lavelle has begun work on her next book, which will explain the process of financial politics in the US to an international audience.
Her first book, The Politics of Equity Finance in Emerging Markets (Oxford University Press, 2004) analyzes the historical and political processes that led to the ownership structures of large firms in middle and low-income countries. As a result of these processes, the book uses insights from international relations to argue that corporate governance will fail to institutionalize along the lines of either the Anglo-American or Continental models in emerging markets. To conduct the initial research for this project, Dr. Lavelle was awarded a 1999 West Africa Research Association Fellowship to travel to Abidjan, Cote d'Ivoire.
Dr. Lavelle's interest in international political economy and international organizations extends to her dissertation research that examined the ideological and institutional restructuring of the United Nations Conference on Trade and Development (UNCTAD). To complete the dissertation, she conducted interviews and archival research at the UNCTAD secretariat and its adjoining missions in Geneva, Switzerland. She was subsequently selected as a participant in the 1997 Academic Council on the United Nations System (ACUNS) workshop on international organizations held at Brown University. To update the work, she spent the summer of 2003 as a Visiting Research Scholar at the Ralph Bunche Institute for International Studies, Graduate Center, CUNY.
She has published articles, book reviews, and book chapters appearing in Perspectives on Politics, International Organization, Review of International Organizations, The Journal of Modern African Studies, Third World Quarterly, Review of International Political Economy,International Journal of Political Economy, International Studies Review and The Columbia Journal of World Business.
Friday Lunch Upcoming Topics and Speakers:
October 16: Virtue, Vice, and Contraband: The History of Contraception in America. With James M. Edmonson, Curator, Dittrick Medical History Center and Museum
October 23: Reforming Cuyahoga County Government. Speakers TBA
October 30: The University’s “Internationalization” Initiative. With David Fleshler, Associate Provost for International Affairs
November 6: TBA
November 13: What Should the Common Reading for New Students Do? With Mano Singham, Director, University Center for Innovation in Teaching and Education and Mayo Bulloch, Director, Educational Enhancement Programs at Case Western Reserve University
November 20: Chesapeake Bay and the Need for Dark Green Environmentalism. With Howard R. Ernst, Associate Professor of Political Science, U.S. Naval Academy
November 27: Thanksgiving Break
December 4: What the Health Care Reform Legislation Will Do, or Why Health Care Reform Failed, or Health Care Reform: What Next? or All of the Above. With Joe White, Professor of Political Science
The Friday Lunch discussions are held on the lower (ground) level of Crawford Hall. Visitors with mobility issues may find it easiest to take advantage of special arrangements we have made. On most Fridays, a few parking spaces in the V.I.P. lot in between Crawford Hall and Amasa Stone Chapel are held for participants in the lunch discussion.
Visitors then can avoid walking up the hill to the first floor of Crawford by entering the building on the ground level, through the garage area under the building. The further door on the left in that garage will be left unlocked during the period before the Friday lunch. On occasion, parking will be unavailable because of other university events.
For more information about these and other Center for Policy Studies programs, please see http://policy.case.edu.