Vague Leadership from Geithner and Summers
June 15th, 2009
Larry Summers and Timothy Geithner co-authored a piece in the Washington Post today which details five issues that need to addressed in the current financial system and details their plan to deal with each issue. The first 4 issues are domestic in nature, and they lay out plans to deal with each; the fifth priority is the issue regarding regulation in the international financial system, and their plan for addressing this issue is less than clear. From today’s Post:
Fifth, and finally, we live in a globalized world, and the actions we take here at home — no matter how smart and sound — will have little effect if we fail to raise international standards along with our own. We will lead the effort to improve regulation and supervision around the world.
Are they saying anything in that paragraph except “we intend to lead?” But lead where? To a world with better regulations? What are those regulations? What does better mean? I will concede that it is nice that they realized that they could not solve all of the problems in the international financial system in one paragraph, but this is still not the most reassuring statement. I think we all look forward to seeing some more detail (and action) come out in the near future.