Two aspects of global imbalances -- undervalued exchange rates and sovereign wealth funds -- require a multilateral response. For reasons of inadequate leverage and eroding legitimacy, the International Monetary Fund has not been effective in dealing with undervalued exchange rates. In this working paper, CGD senior fellow Arvind Subramanian and his co-author propose new rules in the World Trade Organization to discipline cases of significant undervaluation that are clearly attributable to government action. Placing exchange rates and sovereign wealth funds on the trade negotiating agenda may help revive the Doha Round by rekindling the interest of a wide variety of groups, many of whom are currently disengaged from the round.

U.S. Sec. of Defense Robert Gates and more than 50 retired three- and four-star generals are calling for the next American president and Congress to rely more on development and diplomacy alongside defense in responding to global problems. Gates met last week with the House Foreign Affairs Committee while retired U.S. Marine Corps Gen. Anthony Zinni and retired U.S. Navy Adm. Leighton W. Smith, Jr. testified before the Senate Foreign Relations Committee and launched the Center for U.S. Global Engagement's National Security Advisory Council. CGD senior associate for outreach and policy Sarah Jane Staats reports that the "brasstops" have concluded that the U.S. can no longer rely on military power alone to keep it safe from terrorism, infectious disease and other global challenges that recognize no borders. Are the presidential candidates and Congress listening?

Read the blog and comment