By B. L. Wilson
U.S. Treasury Secretary Jack Lew said that the global economy is “back on track to growth” after the worst economic crisis since the Great Depression but expressed concern that workers and families in many countries are experiencing the benefits.
“I stress the importance of strong sustainable balanced and inclusive global growth,” Mr. Lew said, “so that the benefits of that growth are shared more broadly in each of our countries throughout the world.”
The secretary’s comments were made Friday during a press conference at George Washington University’s Jack Morton Auditorium. The press conference was scheduled as part of the fall meetings of the IMF and World Bank on GW’s Foggy Bottom Campus.
People in some countries have not benefitted from the global economic recovery because of what the IMF characterizes in its World Economic Outlook as “persistent stagnation.” For nine years in a row the fund has had to scale back its assessment of growth, the most recent slowdown linked to a sluggish U.S. economy and Britain’s vote last spring to leave the European Union.
Mr. Lew did not disagree entirely but chose to look at the situation somewhat differently.
“I stress the importance of strong sustainable balanced and inclusive global growth,” Mr. Lew said, “so that the benefits of that growth are shared more broadly in each of our countries throughout the world.”
He acknowledged that the economy in the United States and globally has been marked by slow growth.
“It’s not a recession. We are aspiring to get to more robust growth, but we are growing in the United States,” Mr. Lew said. “The global economy is growing. It is an important distinction, but it is a mistake to characterize the current economy more negatively than that.”
The secretary said that it is important to keep an eye on relations between the United Kingdom and the European Union and on Greece. “This is the first annual meeting in a long time where we haven’t had something that is described as a Greek crisis,” he said, “and that’s a good thing.”
Mr. Lew would not comment on whether a drop in the pound last week was a response to Britain’s hardline on Brexit and a plan the government has since backed away from that would have required companies in the UK to list all foreign workers.
He said it takes time to understand why movements in currency occur.
As for relations between the UK and the EU, Mr. Lew said that he and President Obama “…have made a strong case for parties to remain in an amicable discussion in pursuit of a highly integrated outcome. We continue to believe that is the best approach.”
Mr. Lew also emphasized that there are promising signs in countries such as Japan, China and Germany, which are embracing policies for stronger growth with more aggressive stimulus tools, including delays in tax hikes and increased spending to support domestic consumption.
This represents “a big change, a good change,” he said, from the years following the economic crisis when austerity measures were favored.
Some recent policy changes were attributed to rising political tensions in the United States and Europe over globalization and trade policies whose fairness have been questioned by working people.
“Some of the tension that we see in our politics over issues like trade doesn’t reflect an assessment that trade is not good for growth,” said Mr. Lew. “It reflects a concern that even if it is good for growth what does it mean for me and that has to reflect itself in policies.”
GW Students at IMF Meetings
More than 100 of GW students volunteered to work at the IMF meetings, which included sessions on the repercussions of Brexit in the United States and Europe, which included as a panelist the GW Graduate School of Political Management Interim Director Lara Brown, and another presentation called "The Shifting Global Economic and Political Landscape: Fragmentation or Integration," which included the chief economic advisor to German Chancellor Angela Merkel, the president of Eurasia Group and a former Australian prime minister.
Tushar Madan, a senior in the Elliott School of International Affairs who is majoring in international affairs and economics, was among the student volunteers who gained experience and close access not only to sessions but also to policymakers.
“Being present at different IMF seminars helped me better understand the thought process that goes into evaluating and creating IMF policy,” Mr. Madan said.
Mr. Madan, who is president of Delta Phi Epsilon, GW's professional foreign service fraternity, said a member of the fraternity, who was also a volunteer, connected with several ministers of the Kenyan Parliament who agreed to come speak with the organization and GW students in the future.