Does the current financial crisis undermine the credibility of corporate governance efforts--or prove they are needed now more than ever?
Weakened by the economic crisis, President Medvedev and the Kremlin do not want to risk any chance of allowing popular dissent to develop in Russia's regions. But by attacking its opponents the Kremlin is showing its helplessness. Before the crisis it had hoped to modernize the country, now it must resort to damage control.
The genius of all great systems is their ability to reinvent themselves, to adapt to changing environments. That's the reason why those whose response to the current crisis is to announce the end of capitalism are so misguided. Capitalism will survive. But it will not, and should not, survive unchanged. We are going to enter an era of resurgent regulation at the national level and global level.
The United States has long relied on a financial system that intertwines its economy with China and Japan, allowing us to run huge trade and budget deficits. Now, as this ad-hoc system may be leading the world toward a global depression, most policymakers agree that the U.S. should reduce its trade deficit with Asia, while Asian countries should abandon their strategy of export-led growth.
Unless Beijing can get its economy going again, the government is likely to face their first sustained wave of protests in decades. Thus far, China has kept labor protests separate from one another, preventing them from developing a common theme or a common leader. But if China's downturn turns into an outright recession, the country could face its first serious threat to the regime.
As emerging-market powers have grown economically, their geopolitical rise is occurring equally quickly. The G20 summit highlights a new ‘new world order,’ in which emerging powers have a stronger voice in international institutions. Despite their sometimes differing agendas, countries like China, India, Russia, and Brazil are learning to work together to earn a voice in this new economic order.
The G20 meeting scheduled for November 15 will begin to restructure the global economic order, presenting new challenges to the leaders of wealthy nations. The U.S. must support new global financial institutions and regulatory systems, and President-elect Obama will need to convince Americans that stronger multilateral mechanisms will actually help preserve our sovereignty and influence.
The current financial crisis and resulting credit squeeze raises many questions about how to finance big capital projects. Carnegie hosted a discussion investigating how the financial crisis will affect nuclear reactor construction in the United States.
In his first—and possibly last—state-of-the-nation speech, President Medvedev seemed to focus on returning Putin to the Kremlin instead of adequately addressing Russia’s troubled economy. It is clear from the address that the president intends to increase United Russia's dominance by increasing its control over both the regional elite and the government.
China’s just-announced nearly $600 billion stimulus package is almost certainly overkill for China’s needs—China’s domestic demand expansion this year is too strong to warrant this much money spent any time soon. But the stimulus announcement is just in time to give a needed lesson to the U.S. government about what an effective stimulus package might look like.