On Financial Restraint

New Zealander Robert Wade, Professor of Political Economy and Development at the London School of Economics and Political Science and author of Governing the Market, debates global finance with the UK’s leading economic commentator Anatole Kaletsky in Prospect‘s December 2007 issue. Wade argues global finance is out of control, citing an increase in serious financial crises in wealthy countries over the past two decades. He discusses the “outer wheels” driving this instability which include: the US dollar standard and the response of central banks in countries running trade surpluses like China. Wade says these outer wheels need to be reconfigured. “Global economic governance has to find a better way to rein in trade imbalances,” he says. Wade has also worked at the IDS Sussex, the World Bank, Brown  University, and the Institute for Advanced Studies at Princeton and Berlin.