by Jeffrey Dastin:
An impressive crowd filled Luce auditorium to capacity, and security guards attempted to block entry even to the assertive Globalist reporter. The attraction was a discussion with World Bank President Robert Zoellick about global dilemmas of the twenty-first century. Mixing seriousness with a personal levity, Zoellick emphasized the importance of multilateralism and suggested that history and interdisciplinary study have shaped his view of the economy.
The discussion began as a conversation between friends. Zoellick answered a question regarding public service first by praising his interviewer Ernesto Zedillo, director of the Yale Center for the Study of Globalization, for his work in strengthening democracy as the former president of Mexico. Zoellick then claimed his love of history drew him away from the private sector. It taught him the virtue of patriotism and the complexity of public issues. He continued to be influenced by a historical perspective, warning against the dramatization of the recent financial crisis, for example: the late 1960s was as tempestuous an era, albeit for different reasons.
The financial crisis most significantly shows the need “to modernize multilateralism,” Zoellick said. There has been a multi-speed recovery, with emerging markets faring better than the United States. Zoellick called on policymakers to focus on the fundamentals of growth, whether microeconomic or structural, and to put protectionist interests aside. This look to global rather than national concerns reflects a new era in which half of economic growth comes from different emerging markets. Institutions must adapt to the expanse and interconnectedness of today’s economy. “I do think there is a challenge for those of us interested in America’s role in the world to continue to press how [international engagement] serves America’s values, its interests,” Zoellick stated earlier.
The role and limited membership of the G20 exemplify some difficulties of multilateralism. “The numbers don’t add up,” Zoellick said. The world has more than twenty economic players. However, adding members is not the solution. “More people makes it more representative and therefore legitimate, but the more people, the harder it is to get things done.” Zoellick argued that the G20 should act as an informal guide to all nations whereas the World Bank’s “G187” can represent them. Interestingly, Zoellick referenced the inefficiencies in the League of Nations to justify why the G20 should not be bureaucratic. This, along with multiple references to the 1944 Bretton Woods Conference, again suggested how history shapes Zoellick’s thought.
The conversation remained engaging throughout, touching on the panacea of Chinese currency appreciation and structural problems in American entitlement programs. Zoellick cautioned against currency instability due to large deficits, which has driven markets to use the anachronistic gold as an alternative measuring value. Zedillo then asked, “How do you feel about your child?” The lighthearted question referred to Zoellick’s defining project, the Doha Development Round, which attempts to lower global trade barriers. In recent years since the failed 2003 Cancun conference, “a deal is doable,” Zoellick said. “[You try] to liberalize as much as you can while dealing with everybody’s politics.” Compromise is the solution.
Except for this latter point, the conversation failed to address Zoellick’s specific work at the World Bank, such as the aid package he organized for Haiti last year. Zedillo’s role was also lacking, limited to brief points interweaved into his questions. Such a prominent world figure surely had more to say. But the joy each took in the conversation made up for it. In the spirit of Eli, Zoellick referenced a book by Kenneth Rogoff but withdrew his praise: “[He] is at Harvard and before that [he was at] the IMF, which is kind of like Harvard.” Ironically, Rogoff was an undergraduate at Yale.
Jeffrey Dastin ’14 is a freshman in Saybrook College. Contact him at jeffrey.dastin@yale.edu.