By Gordon Brown
The Washington Post
Friday, October 17, 2008; Page A25
This is a defining moment for the world economy.
We are living through the first financial crisis of this new global age. And the decisions we make will affect us over not just the next few weeks but for years to come.
The global problems we face require global solutions. At the end of World War II, American and European visionaries built a new international economic order and formed the International Monetary Fund, the World Bank and a world trade body. They acted because they knew that peace and prosperity were indivisible. They knew that for prosperity to be sustained, it had to be shared. Such was the impact of what they did for their day and age that Secretary of State Dean Acheson spoke of being “present at the creation.”
British Prime Minister Gordon Brown listens to questions after an EU summit in Brussels, Thursday Oct. 16, 2008. European Union leaders have agreed to stick to ambitious plans to cut greenhouse gases by 20 percent by 2020, but divisions over how to share out the cuts have been widened by fears over the impact of the financial crisis.(AP Photo/Yves Logghe)
Today, the same sort of visionary internationalism is needed to resolve the crises and challenges of a different age. And the greatest of global challenges demands of us the boldest of global cooperation.
The old postwar international financial institutions are out of date. They have to be rebuilt for a wholly new era in which there is global, not national, competition and open, not closed, economies. International flows of capital are so big they can overwhelm individual governments. And trust, the most precious asset of all, has been eroded.
When President Bush met with the Group of Seven finance ministers last weekend, they agreed that we all had to deal with not only the issue of liquidity in the banking system but also the capitalization and funding of banks. It was clear that national action alone would not have been sufficient. We knew we had to send a clear and unambiguous message to the markets that governments across the world were prepared to act in a coordinated manner and do whatever was necessary to stabilize the system and address the fundamental problems.
Confidence about the future is vital to building confidence for today. We must deal with more than the symptoms of the current crisis. We have to tackle the root causes. So the next stage is to rebuild our fractured international financial system.