Guardians of Finance: Making Regulators Work for Us

March 8, 2012

4:30pm - 6:00pm

Santa Monica


Speakers

James Barth and Ross Levine

Videos

Description

The recent financial crisis was an accident, a perfect storm fueled by an unforeseeable confluence of events that collided and brought down the global financial system. And policymakers? They did everything they could, given their limited authority.

At least that's the story that's been fed to the American people.

But economists and regulatory experts James Barth and Ross Levine are here to debunk that version of events. In a provocative new book, they argue that the financial meltdown was no accident. It was negligent homicide.

Authors James Barth, left, and Ross Levine argue for establishing a financial Sentinel with the authority to demand information and the ability to make an informed and impartial assessment of financial regulation.
Authors James Barth, left, and Ross Levine argue for establishing a financial "Sentinel" with the authority to demand information and the ability to make an informed and impartial assessment of financial regulation.

In "Guardians of Finance" (written with Williams College economist Gerard Caprio), Barth and Levine show that senior regulatory officials around the world knew (or should have known) that their policies were destabilizing the global financial system. They had years to process the evidence that risks were rising and the authority to change their policies - but they chose not to act until it was too late.

Barth and Levine maintain that the current system is simply not designed to work on behalf of average citizens. It is virtually impossible for the public and its elected officials to make an informed and impartial assessment of financial regulation and to hold regulators accountable.

But there's a potential solution at hand: the establishment of a "Sentinel" empowered to demand information and evaluate it in terms of the public interest - rather than that of the financial industry, the regulators or politicians.

"This book will become a classic for those who want to learn what was behind the global financial crisis-not just what went wrong, but why current reforms won't work. Most important, it offers guidelines to prevent the next crisis by forcing regulators, the Guardians of Finance, to work for the public interest rather than for narrow elites."

- Nouriel Roubini, Co-Founder and Chairman, Roubini Global Economics
Guardians of Finance: Making Regulators Work for Us

James Barth is the Senior Finance Fellow at the Milken Institute and the Lowder Eminent Scholar in Finance at Auburn University. His research focuses on financial institutions and capital markets, with an emphasis on regulatory issues. Barth was previously chief economist of the Federal Home Loan Bank Board and later of the Office of Thrift Supervision. He has been a professor at George Washington University and associate director of the economics program at the National Science Foundation. Barth is the author of multiple books, including "The Rise and Fall of the U.S. Mortgage and Credit Markets." He holds a Ph.D. from Ohio State University.

Ross Levine is the James and Merryl Tisch Professor of Economics at Brown University, Director of the William R. Rhodes Center for International Economics and Finance, a Research Associate at the National Bureau of Economic Research, and a member of the Council on Foreign Relations. His work focuses on the links between financial sector policies, the operation of financial systems, economic growth, and income distribution. Levine has written several books and published over 100 articles, including papers in leading finance and economics journals.