Saturday 29 October, 3.30pm until 5.00pm, Lecture Theatre 1
During the final two thirds of the twentieth century, the US and the dollar reigned supreme in the world. But now, as each year passes, economic power shifts more and more away from the US, and from the West in general, to China and the rest of the emerging economies. So have America’s straitened economic circumstances undermined its claim to a leadership role in global institutions?
For a time it appeared the US economy had come through the Western Financial Crisis better off than most other advanced economies, but confidence in its ability to keep recovering is now low, with some fearing a double-dip recession. Unemployment remains around 9% and annualised growth rates for 2011 look to be under 2%. Wages for the vast majority of non-government workers dropped in April to lower than they were in the recession. And house prices are 33% lower than in 2006. There are signs of resurgence in manufacturing output, but pessimists point out that neither domestic nor foreign consumers have the spare cash to buy American. Moreover, America’s recovery so far has been dependent on unprecedented levels of state stimulus from easy monetary and fiscal policies: historically low interest rates, quantitative easing measures from the Federal Reserve and huge public spending deficits. As the stimulus wears off, are we starting to see some uncomfortable truths about the durability of any underlying recovery? With consumers putting off purchases and reducing debt while producers sit on cash hoards but fail to invest, is it possible to predict anything more than the patient’s continued survival? Sluggish and anaemic growth at best? Long-term structural unemployment?
Will America still be able to live off the rest of the world to the same extent, seemingly able to spend more than it produces for year after year? For how much longer can the world’s biggest foreign borrower be the world’s leading political and military power? Or, while long term relative decline may be irreversible, is it too early to write America down? Could it use that borrowing power and its reserves of chutzpah to turn things around and astonish the world again? Is there life yet in the America’s famed, and some say unique, economic resilience, its aspirational spirit, labour market flexibility and intrinsic business drive?
Listen to session audio:
 | Professor Iwan Morgan head of US Presidency Centre, Institute for the Study of the Americas, University of London; author, The Age of Deficits |
 | Phil Mullan economist and business manager; author, Creative Destruction: How to start an economic renaissance |
 | Martin Wolf associate editor and chief economics commentator, Financial Times; author, Fixing Global Finance |
| Chair: | |
|
Angus Kennedy
convenor, The Academy; author, Being Cultured: in defence of discrimination |
Now the technology exists to extract the reserves, the promise is of an industrial renaissance
Ed Crooks, Financial TImes, 6 October 2011
The US needs a New Deal - but Obama has displayed zero appetite for big liberal ideas
Alexander Cockburn, First Post, 9 September 2011
The ill-tempered struggle in Washington over raising the federal debt limit is enough to make anyone gloomy about the future of the US. Clive Crook, my FT colleague, rightly contrasts the stasis among politicians with the “unrivalled energy and ambition” of US workers.
John Gapper, Financial TImes, 27 July 2011
Of course, no one would deny that there are cyclical elements in the downturn of 2008. But they were accompanied by structural imbalances that had been building over at least 15 years, and that are at the heart of the US economy’s inability to bounce back in a normal cyclical way.
Michael Spence, Project Syndicate, 14 July 2011
The debt debates underway in the US and the EU are so inward-looking and overwrought that surprisingly few people are making the connection.
Gideon Rachman, Financial Times, 5 July 2011
Although America’s recovery from recession is disappointingly slow, policymakers doubt the merits of another monetary or budgetary push
Economist, 16 June 2011
Capitalism has been corrupted by paper money and debt. Sustainable prosperity will require a return to economic orthodoxy. This book maps the way back.
Richard Duncan, CLSA Books, 14 December 2009
The key is to acknowledge that, in a world of adjustable currencies, international lending must be denominated in the currency of borrowers, not just in that of a few dominant advanced economies. Only by tackling imbalances in the international financial system is there a chance of global financial stability.
Martin Wolf, Yale University Press, 30 January 2009
