Gordon Brown, the former prime minister of the United Kingdom, argued Thursday for a new global financial system to solve economic problems throughout the world and to prevent future dilemmas.
Brown, also an acting member of Parliament, gave the annual Malcolm Wiener Lecture in International Political Economy at Harvard University's John F. Kennedy Jr. Forum last Thursday night to an audience of about 400 people.
"Markets need morals," Brown stressed throughout his speech.
Brown was the Heffernan Visiting Fellow at Harvard's Institute of Politics last week, spending much of his time with students on the campus, which he called "one of the greatest international universities in the world."
A former chancellor of the exchequer and an experienced economist, Brown offered his view on the proper solution to the global economic crisis.
Throughout his speech, Brown emphasized the need for "global coordinated action" to stimulate worldwide economic growth.
"No longer can we make decisions about economic growth without considering Asia," Brown said.
To this point, Brown focused on the trade deficits of many Western countries, like the United States.
"Asian countries [should] become consumers of goods from Europe and America" instead of decreasing imports, Brown argued.
"If Asia becomes a consumer of world goods, the global economy will have 30 million more jobs and somewhere between 50 and 100 million people will be brought out of poverty," he said, citing a current study by the International Monetary Fund.
This coordinated effort would be in the interest of Asian countries as well, Brown said.
"Chinese, Indian and Asian countries want the prosperity that has eluded them," Brown said. "We, with our expertise, can sell to the Asian markets, with a billion potential consumers."
Because the crisis is so global, it requires a global solution, Brown said.
"The first crisis of the global age cannot be solved by national solutions," he said. "We need new policy and new institutions in what is a fundamental shift in the way the world works."
According to Brown, this new institution must be a "global financial system with a constitution . . . for global oversight."
The system would be put in place in order to ensure that people are "undertaking reasonable risk," Brown said.
"Morals do not come from markets, but from people," he said.
Brown concluded his speech by calling his audience, and particularly the Harvard students, into action and public service.
"Things that seem impossible . . . can be achievable," Brown said, using historical moments such as the U.S.'s role in rebuilding Europe after World War II and the sudden end of the Cold War as examples.
"I hope what I say has some use to the future debates you will have in this country . . . [however], justice will only occur when those who do not suffer are as angry as those who do," Brown said.
After the speech, many Harvard students spoke in warm terms about not only Brown's solutions, but also his presence on campus.
"When he arrived on campus there was a real buzz around him . . . It's really exciting to have someone so distinguished in their field, and so dedicated to public service come spend time on campus," said Rosario John Aquino, a freshman at Harvard. "He understands how important it is to address the issues of today to help educate the leaders of tomorrow."
"Gordon Brown really convinced me of how important global action needs to be in the future . . . I think in this new age, it will be really important to coordinate policy not just in economics, but in other areas such as the environment," said Steve Burke, a Harvard freshman.
However, not all audience members were swayed by Brown's words.
"Being the fiscal conservative that I am, "a global coordinated financial system' sounds a lot like socialism. Even more than that, I think Gordon Brown is underestimating the difficulty in coordinating economic policy with Asian countries," said Matthew Condakes, a Harvard freshman.
"Western countries will not always have the same motives or goals as countries like China. Realistically, I think it would be very tough to pull off what he is suggesting," Condakes added.
Thursday marked the 22nd year for the Malcolm Wiener Lecture Series.
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