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President Obama knows all too well that you get no credit in politics for the bad outcomes that you’ve managed to avoid. And so yesterday at the White House Summit on Global Development, as he outlined the programmatic successes of his administration’s global development policy (all genuine and worthy of acclaim), he didn’t even bother to mention the response to the global financial crisis that consumed him and his administration for much of its first year and continued to require major efforts from the White House, Treasury, and Federal Reserve in the years that followed.
Yet, when we consider what could have happened, just how perilous the economic conditions were for the United States and the world during that time, it is not unreasonable to conclude that the cause of global development was served at least as much by these efforts than by any single development initiative launched by an American president.
We know from a body of evidence assembled by the IMF, World Bank and others that economic shocks can set back development gains disproportionately – a temporary shock can lead to longer term losses in gains around poverty reduction and income growth. We also know just how much was at stake in the global economy when President Obama took office and how much depended on effective policy responses. My favorite accounts of this period come from the autobiographies of three actors on the front lines: Tim Geithner, Ben Bernanke, and Barney Frank.
Granted, a developing country finance minister or central bank governor might resist crediting the actions of a country on whose shores the crisis began. But there was nothing pre-determined when it came to the smart,aggressive, and politically painful policy responsesthat were launched in the waning days of the Bush administration and carried forward during the Obama administration. Surely no one who has watched the US Congress in recent years can look back with confidencethat it would have acted as decisively as it ultimately did to approve the crisis measures requested by these two administrations.
As a political slogan, “it could have been worse” will never be a winner. But I do think it’s important on the world stage, as much as it is domestically, to remind voters and politicians of the critical role policy has played in avoiding and mitigating bad, sometimes disastrous, outcomes at key moments.
We are living in a period of political backlash against the very activist policies that saved the global economy from calamity less than a decade ago. It maybe asking too much of voters that they should feel better off as a result of TARP, swap lines, and quantitative easing (1, 2 and 3). But neither should the architects of those measures shy away from claiming their successes and even attributing some of their benefits to cocoa farmers in rural Cote D’Ivoireand factory workers in Vietnam.
So by all means, President Obama should embrace the successes of Feed the Future and PEPFAR in terms of lives saved and poverty reduced, but in the same way, he deserves to take a bow for making the global financial crisis less severe than it could have been.
President-elect Trump will come into office at a time when Americans are more dependent than ever on global cooperation. Today we revisit why effective US leadership on development matters and how it can be improved.
CGD founding president Nancy Birdsall has seen a few US presidents come and go in her long career as a leading development economist, but her message to all occupants of the White House has remained fairly steady: Enact smart policies that help developing countries build stable, prosperous economies of their own—and that will help people at home too. This week she joins the CGD Podcast to talk about some of those ideas, and why development should be a priority for the next US president.
The Obama administration has taken some important steps to put women’s economic empowerment at the center of US foreign and development policy, but there’s still plenty of work left to do. Researchers and advocates alike have made the case for why gender equality—and specifically women’s economic empowerment—is critical for achieving economic growth, eradicating extreme poverty, and improving the health, education, and well-being of people worldwide. This blog post turns to concrete ways that the next US administration can promote women’s economic empowerment, thereby maximizing the impact of its development agenda.
The next US president will face ongoing and emerging global health crises. The next administration must work to transform the US approach to global health and global health security to protect the health of Americans here at home and ensure the long-term sustainability of US-supported health gains abroad. So, what changes should the next US president and administration implement? Here are our six concrete recommendations.