Bold Actions Of G20 London Summit

As I recognize it, there remains a debate between those who believe that the current economic environment compels a dramatic rethink of the foundations, systems and structures upon which the global economy operates, and those who believe that such sweeping reforms are both unnecessary and politically impossible.

In short, there are those who seek to begin the process of crafting a ‘new Bretton Woods’ and those who seek to ban the use of that phrase altogether.

In my earlier post, I wrote(scribbled) about "the global financial sector is in need of structural reform". I believe that the current economic crisis provides an opportunity to reshape the global financial system in ways that more accurately reflect the global nature and risks inherent in 21st-century banking, finance and capital flows.

This G20 gathering represents a true ‘free market’ where there is competition for ideas, creativity and leadership. It provides the perfect opportunity for a 21st-century successor to the intellectual and creative leadership of John Maynard Keynes to emerge.
To be successful, it is imperative that the United States play an active leadership role at the London Summit. The US has a unique role. The failure of the US to assume a leadership role, especially with the presence of President Obama, would undoubtedly be seen as an
opportunity missed.

The most innovative and bold structural proposals have come from Europe, where a recent report by the High Level Group on Financial Supervision in the EU, under the direction of Jacques de Larosière, contains some very worthy, realistic and detailed recommendations.
Unofficial groups, such as the G30 Financial Reform Working Group chaired by Paul Volcker, have similarly issued reports which I urge summit participants to review carefully and consider seriously.
The proposal is important because it seeks to address the systemic nature of risk, which underpins the existing financial system, and also because of its inherent inconsistency.
Given the magnitude and scale of the issues now confronting summit participants, those officials tasked with its preparation should not feel bound to adhere strictl to the agenda and working groups created four months ago.
Now is not the time for caution, but rather the time for bold assertion of leadership, ideally by the United States, but hopefully with the collective support of the global community.