Between 1929 and 1931, global financial relations suffered a catastrophic breakdown that exacerbated the Great Depression, contributed to the break-up of the global economy, and stunted the development of sound welfare provision in Europe and North America. Could such a breakdown occur again? Is the global financial system more stable and robust today than in the 1920s? To answer these questions, Randall Germain canvasses the political and economic foundations of global finance during the 1920s and 1930s, and compares these foundations to what exists today. In many ways today's global financial system is more secure, stronger and better entrenched than its inter-war antecedent. However, on the big question of how to combine political authority with technical expertise and adequate financial resources, we are no further ahead. In today's world, like that of the 1920s, no single institution at the global level offers a combination of attributes that inspires confidence: financial stability continues to be frail and inadequately anchored by publicly sanctioned authority. The policy conclusion is clear: a sustained debate about how to anchor public authority in a globalized financial environment needs to be started before the next financial crisis unfolds, and this debate needs to be focused on how best to combine political authority, technical expertise and financial resources within appropriate international financial institution/s.
A light lunch will be provided.
Randall D. Germain is Associate Professor of Political Science at Carleton University, Canada. He is the author of The International Organization of Credit: states and global finance in the world-economy (Cambridge University Press, 1997), the editor of Globalization and Its Critics: perspectives from political economy (Macmillan Press, 2000), and the co-editor with Michael Kenny of The Idea of Global Civil Society: politics and ethics in a globalizing era.. His work has been published in journals such as The European Journal of International Relations, Global Governance, Review of International Studies, Global Society and Review of International Political Economy.