Ideas on the Future of the Economy

Thursday, July 02, 2009

David Wessel, Wall Street Journal economics editor, Raghuram Rajan, former IMF chief economist, Roger Ferguson, president and CEO of TIAA-CREF, and Gerard Kleisterlee, president and CEO of Royal Philips Electronics, participate in a panel discussion about the state of our economy--and whether they think the U.S. will lag or lead in the global recovery.


Roger Ferguson, Gerard Kleisterlee, Raghuram Rajan and David Wessel

Comments [19]

David Kirschner from Montclair NJ

Is anyone engaging the likelihood that economics is a pseudoscience --- and that we should be far, far more cautious in accepting economists' assertions as credible?

The accepted theories of economics are based on questionable or demonstrably untrue assumptions (e.g., the earth is an open system with infinite resources and infinite capacity to absorb the byproducts of growth, or that all human motivation is fundamentally economic), and there is no way to scientifically test its theories.

Economists have excellent hindsight, but their capacity to tell us what's happening right now or to predict is dismal, and may not be as good even as astrology. When is someone going to stand up and ask the really hard questions?

Jul. 02 2009 11:32 AM
peacepipe from Bronx

bravo Carl and many others -- the 'real' Panel of Ideas is here on the Comments page!

Jul. 02 2009 11:01 AM
Carl from Long Valley

The financial industry caused the problem -- through their GREED and complete disregard of consequences for the public ( there are NO consequences for them). A few high-profile prosecutions are just a circus show for the mass audience (as long as they don't get distracted by Michael Jackson). We had a 20+ year "experiment" with deregulation & 'free markets' (Don't you feel like a lab rat by now?). All there 'experts' on the panel and on TV, etc. should try doing something to help - instead of just talking about how bad things are.

Jul. 02 2009 10:54 AM
RJ from brooklyn

Stephanie also asked about the difference in focus between innovation in *making things* and in what I call *pushing paper*--an illusion of wealth on paper.

Also, I hear a focus on K-12 aimed at a "higher education" focused on producing "innovators" who strictly produce stuff that brings short-term return: ideas for technological stuff, ideas for how to create new business stuff (paper to "trade"). Not k-12 that help young people think, develop ideas, engage the world around them, perhaps *change* this notion of risk/reward culture.

Also, what about a K-12 education that gives us plumbers, electricians, janitors, home-health aids, and other trained personnel who, as a recent book ("Shopcraft as Soulcraft" notes) also provide tremendous inherent value and are stigmatized as "unskilled" and marginal.

Jul. 02 2009 10:53 AM
peacepipe from Bronx

Almost totally ignored, and the biggest gorilla sitting in the corner, is the ENVIRONMENTAL IMPACT of new/big business ventures. For example, silicon valley/Apple etc. are built on having manufacturing in China, where regulations on protecting the planet are lax to say the least.

This is one model that simply can't, and won't, continue. Go ahead and move operations to China--and then see if you can get edible food/drinkable water there in 20-30 years, good luck with that. The shift happening now MUST include massive, drastic changes in the environmental waste/damage model currently used by nearly ALL industries/businesses.

Jul. 02 2009 10:48 AM
Hugh from Brookyn

Just take a look at the sponsors of the Festival of 'Ideas' -- Altria (cancer), Boeing (failing aircraft and bombs), Mercedes-Benz (wildly expensive cars for the wealthiest 1%), Shell Oil (need I say anything), and on.

The only names missing are Citigroup and Goldman Sachs, but they don't need any more influence - Obama has already given them all they could reasonably want, and more.

Don't kid yourselves. This is no festival of ideas. It is a festival of (as Galbraith would have put it) "received wisdom". And WNYC today is merely an enabler, which all that most of public radio -- especially NPR -- has been since the Reagan years.

Somewhere on the order of 5 percent of the speakers are war criminals (Kenneth Adelman, Madeleine Albright, Michael Chertoff). Easily half of the remainder are their idolaters and defenders (David Brooks, Charlie Rose, Niall Ferguson, Thomas Friedman, Jeffrey Goldberg).

A relative handful (Marian Wright Edelman) are actually people with a conscience.

Jul. 02 2009 10:46 AM
LANVY from Saigon Vietnam


I started a fashion business that is "bi-continental": New York - Vietnam. Garment production in NY is extremely cost prohibitive in the tri-state area; oversea production is volume prohibitive (the mininum quantities are too high for a small start-up). On the other hand, the big businesses have made it very easy for big overseas factories to turn away from labor abuse.

We are a SOCIAL ENTERPRISE that addresses the needs of both sides of the world:

1) We produce at small quantities for small buyers in the US

2) 50% of our profit goes towards creating schools, teach new skills, and provide jobs for women and girls formerly abused

We are specifically in Vietnam because of the opportunity for growth given the country's 60% population below the age of 37. (We sell a lifestyle line in Vietnam as well where the margin there is higher than selling in the US)

We are specially in VN because there is an opportunity for us to positively effect the social needs.

We are available for small design houses access overseas production:

Jul. 02 2009 10:43 AM
alex from brooklyn

Your panelists don't understand the link between K12 and higher ed.

Only a fraction of k12 students go on to higher ed, and only a small fraction of them go to our elite institutions. With population growth, those fractions are getting even smaller. We do not need a great k12 nationally to feed our great universities. All we need are a few great local k12 systems amid a large sea of mediocrity (or worse). That's how we got to where we are.

Access, universality, equity and perhaps even justice are what needs to motivate k12 improvement. It's about raising the floor much more than raising the ceiling, because we can raise the ceiling with those small pockets of excellence and that tiny fraction of students.

Of course, looking at what has passed for education reform in the last 10 years, we don't see any efforts to encourage innovative or creative thinking by students. There are not efforts to build upon or expand parts of our education system that the rest of the world wants to emulate. Rather, reforms push industrial-age skills over knowledge-economy skills.

Jul. 02 2009 10:40 AM
hjs from 11211

the standard of living is higher in western europe than china or the USA, but have a good trip

Jul. 02 2009 10:37 AM
david from New York City

My question, as always, is what will be done to bring back the middle class, and encouraging an expanding middle class in the world at large? Will regulation stifle innovation? Well, by my reckoning, haven't we just gone through a period of deregulation and 'innovation'? What a bitter fruit that has produced. Without regulation, it seems to me, that we are doomed to perform the same mistakes over and over again. Anyway, those are my thoughts and questions.

Jul. 02 2009 10:33 AM
Carl from Long Valley

Absolutely NO PROBLEM with increasing the regulation , oversight, AND PENALTIES for crooks & liars that are currently trying to get away with what they have done. How can any rational person believe that we should not go for far more tranparency and regulation???

Jul. 02 2009 10:29 AM
Grad STudent at McGill from Montreal

As a TIAA-CREF policyholder, what are you doing to protect the general account against the risk of LOW interest rates? Also I notice that you are losing out on getting new professors to sign up to Fidelity and Vanguard... why can't you convince them of the superiority of the good old GUARANTEED 3% annual return. It looked good in 2007, 2008 and now! The Ten year Treasury keeps dropping to 1.0% yields.

Jul. 02 2009 10:28 AM
Hugh from Brookyn

Yet again, a 'range' of ideas, a 'festival' utterly excludes progressives or (heaven forfend!) lefties.

Not since the 1930s has the world seen a greater flood of fact condemning the idiocy of right-wing economics. But the 'Aspen Festival' -- in both location and speakers -- proves it's mired at least 30 years in the past.

Jul. 02 2009 10:28 AM
Charles Harris from Island Heights NJ

What risk are you talking about? Unqualkified people taking risk with other peoples money OR RISK BY VENTURE CAPITALISTS WITH THEIR OWN MONEY. President Obama is not inhibiting nthem or the people who financed Google

Jul. 02 2009 10:28 AM
Stephanie Lee Jackson from Brooklyn

I do not hear any distinction being made between business and technological innovation, which is based on ACTUALLY PRODUCING THINGS, and 'financial innovation,' which, as far as I understand it, has meant gambling on getting something for nothing. There's a difference between risking on a bet and risking on a project.

Jul. 02 2009 10:27 AM
Charles Harris from Island Heights NJ

Risk is fine depending on the project and with whose money. There is no public risk when venture capital takes risks. Obama is trying to regulate unqualified people who take risk with other peoples money

Jul. 02 2009 10:26 AM
CH from Staten Island

Common sense would suggest anyone starting a new business should consider if they would want to live where the venture is, and how quickly can they adapt to the surroundings. After all, if it is a success you might want to stick around, and if it fails you may well be stuck there.

Jul. 02 2009 10:24 AM

My wife and I started WARMABLES. WARMABLES is a heat consolidator which keeps food warm up to 6hrs. The idea was triggered by terrible and non nutritious school lunches served to our child. Our child was tired of cold lunches such as sandwiches, so we thought long and hard on how to keep our home cooked left over food warm enough for him to enjoy for lunch.
WARMABLES which now is a small Jersey City base business of ours.

Jul. 02 2009 10:23 AM
Tony from San Jose, CA

I could use a Green Card, but I am thinking about moving to China. The US is turning more and more communist everyday, just like my home country (France).

Jul. 02 2009 10:21 AM

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