At the Association of Financial Professionals (AFP), which took place in San Antonio in November, the number of attendees (thousands) and exhibits from some of the largest banks and financial firms were positive indicators of an economy seemingly undecided about which direction to go. It appears, at the AFP anyway, banks were open for business.
Former Secretary of State Condolezza Rice, who served in the George W. Bush administration, was the keynote speaker. Rice largely served as the balance to the extreme views of former Secretary of Defense Donald Rumsfeld and Vice President Dick Cheney. Her address to the audience provided insights to the actions she took while serving the government, but was not an apology (nor a defense it seemed) for Bush and the more strident powers on his team.
Key points she made in her address:
1) Despite Afghanistan being a “quintessential failed state,” we “can’t afford to lose faith in helping weak countries.” She noted that the “weak and failing states are the biggest threats” to us.
2) When asked about the BRIC countries (Brazil, Russia, Indian and China), she noted she would rename them the BIC countries because Russia didn’t fall into the category. As a Russian expert, Rice said that after the collapse of the USSR, “we thought (Russia) was on its way to capitalism.” However, “the 1990s was a disaster for the Russian people.” Most notably, the rise of the oligarchs caused hardship for the people and caused a larger gulf between the haves and have nots. She said “Russia wasn’t ready” due to its “state-ism and tyranny.”
3) Brazil and India “have the ability to be super economies,” Rice noted, but are slowed due to Brazil’s dramatic poverty and “it’s hard to do business in India.”
4) China is the most dramatic of the Bric stories, but Rice doesn’t see it “supplanting the U.S as a global economic leader. “China is an economic miracle,” she said, but there are challenges. “It’s an authoritative state,” she noted, which doesn’t “have the feel of what’s going on with the public.” Case in point, she noted were safety issues with products. Further she questions their creativity and imagination. She said the real problem was her doubt that a country “so terrified of the internet” could lead up global innovation. “China always is an early adopter, but not an original creator,” she said.
5) She did give a nod to the mantra of the Bush administration stating that the United States needs private sector growth, which means minimal regulations, low taxes and free trade.
Rice went on to extol the goodness of America, stating that “when there is a problem, the world is glad we’re here.” The world overall respects America because it doesn’t matter where you came from, it matters where you’re going.” She added that immigration is core to America’s spirit and some of its greatest businesses have been founded by immigrants, such as Google founded by a Russian. She said “a world without U.S. leadership is a much weaker place.”
Finally, regarding the bailout program produced by the Bush administration with the 2008 financial crisis, she explained that at the time it “felt as if everything was becoming unstable, not only were countries in a panic, no one was lending. Libor was stuck…….the bailout was to be a shock to the system to get (the economy) going. Maybe it took longer than expected (to work into the system). Maybe something might not have been right, but we had to act. Not acting was not an option.” She seemed confident the actions taken were correct. “Today’s headlines and history’s judgment are never the same.”