LBJ School Professor Travels Across Europe, Russia Providing Insight Into the Global Economic Crisis and America's Role
AUSTIN, Texas-- July 5, 2010-- LBJ School Professor James K. Galbraith spent the summer months traveling across Europe and Russia, meeting with officials and former heads of state, participating in conferences, lecturing at universities and testifying about the state of the global economy and the economic crisis.
Galbraith began his journey, which included seven cities in 29 days, on May 27 with a lecture at the German American Association for American Studies, at Humboldt University in Berlin.
According to Galbraith, the global economic crisis finds its roots in the United States and Washington, D.C. and not in Greece.
“I think the answer is obviously not related to Greece but absolutely related to New York and Washington, to the crisis in the United States, and to a generalized flight to safety; moving out of anything that might be considered problematic,” said Galbraith. “This movement ultimately leads to a political game between the bond markets and the most powerful political entities available, the European Union and the European central bank, over whether those entities will relieve the large financial institutions of the losses associated with a failure of the borrowers to refinance their debts, a game which is being resolved as we speak. And I think the only way it can be resolved which is with the capitulation of the authorities and the Europeanization of Mediterranean debts.”
From Berlin, Galbraith traveled to Moscow on May 30 to deliver a lecture at the Moscow School of Economics. There he also met with President Mikhail Gorbachev and the Gorbachev Foundation.
Following his trip to Moscow, Galbraith returned to Germany on June 3 where he delivered a keynote lecture titled "The Imperative of a Green New Deal" at an inaugural conference of the Institute for Interdisciplinary Social Research at the Friedrich Schiller University of Jena, Germany. The conference was titled "Ways Out of Crisis." Galbraith's remarks focused on what he calls "the great crisis and the small one."
"The great crisis obviously has been underway for two years, although in some respects I think we may look back and say that it really was just beginning," said Galbraith. "We may say that the consequences of the crisis have not yet been felt; that we shall see them in the general decline in standards of living that will follow for a long time -- unless we somehow figure out how to deal with it.
The small crisis is a crisis among we who are economists, and it has been going on for much longer. It is obviously much less significant in and of itself, but it has proven in its own way to have the gravity and intractability of the great one."
Galbraith then traveled to Greece to the Athens Economics University where he gave a lecture on June 8 titled "The Great Crisis and the American Response."
"I'm not going to defend the structure of society here or conduct of the previous Greek government, but the notion that the crisis was caused in some sense by irresponsible public finance in any small country is, it seems to me, clearly a misapprehension," said Galbraith. "It's the nature of credit booms that investors seek every small increase in returns that they can find; that the weak borrowers look good and that poor countries run big deficits financed by capital inflow. It's the nature of credit slumps that the weakest borrowers are singled out for being wicked."
From Athens, Galbraith traveled to Helsinki where he gave brief remarks on June 11 to a conference entitled "Challenges of the Global Crisis to Macroeconomic Theory and International Finance," sponsored by the Bank of Finland and the Banca d'Italia. The conference was held in honor of the memory of the economist Pentti Kouri. His remarks were comments on a paper by E.S. Phelps of Columbia University titled "The Slump, the Recovery and the New Normal." On June 13, Galbraith traveled from Helsinki to Vienna where he delivered a lecture at the Bruno Kreisky Forum and dined with former Austrian Chancellor Franz Vranitsky.
Galbraith's next major stop was in Paris where he testified to the Commission des Finances of the Senat de France on June 17.
On June 18, Galbraith presented the work of the University Inequality Project to the Organisation for Economic Co-Operation and Development (OECD) where he spoke about the movement of global inequality, both over the last 50 years. and in the wake of the economic crisis.
Galbraith ended his trip on June 23 in Washington, D.C. where he participated in a luncheon hosted by the New America Foundation as part of their Bernard L. Schwartz Symposium Series on infrastructure investment and national economic policy.
In addition to his travels, Galbraith also had time to prepare written testimony at the request of the Commission of Deficit Reduction on June 30, which is currently published on the Huffington Post, the New Deal 2.0, and the Campaign for America's Future websites. His piece "Why the Fiscal System Does Not Serve the American People" addressed the Obama administration's bipartisan deficit commission calling the commission's leadership and secrecy into question.
Additionally, Galbraith gave remarks twice at a conference of the Global Progressive Forum and Res Publica in Lisbon, Portugal, July 9 and 10, including concluding remarks in advance of the speech by Portugal's Prime Minister Jose Socrates.
On July 9 Galbraith also penned and essay titled "Tremble, Banks, Tremble" that was published in The New Republic.
Galbraith's next stop was to the Island of Poros where he gave a talk to a Socialist International seminar on July 12.
For audio clips and transcriptions of Galbraith's talks and other information on his travels, visit http://utip.gov.utexas.edu/