From predatory to progressive finance: reorganizing finance for inclusive growth Tamara Lothian Senior Visiting Scholar and Lecturer in Law Columbia University May 27, 2014

From predatory to progressive finance: Outline of remarks The problem presented Lessons from recent experience Points of departure for an alternative approach Development of an alternative approach in the US today The alternative futures of finance and the programmatic agenda of progressives in the US and elsewhere

The problem presented Finance as master rather than servant: the corruption of finance Legal and institutional aspects of the problem in the US: Hollowing out of the New Deal reforms to the benefit of speculative capital Legal and institutional solutions: reorganizing finance in the service of the real economy and to the benefit of a program of socially inclusive economic growth Comparative law as the practice of micro-institutional innovation and reform

Lessons from recent experience Finance and democracy: US in the 1930s; Sweden in the 1990s; Iceland today; contrasting case studies: US and Europe today Finance and the real economy: financial deepening versus financial hypertrophy; Northern Europe; post- war East Asia; US and Germany in the 1930s Finance and the institutional conditions of socially- inclusive growth: opportunities and constraints

Points of departure for an alternative approach From regulation to reorganization Reorganization in the service of two ideals: tightening the link between finance and the real economy; finance and the project of socially inclusive growth Bailouts, bankruptcy and debt relief: Restructuring as experimental reorganization (Geithner and Piketty notwithstanding)

Development of an alternative approach in the US today Repudiation of regulatory dualism Restricting financial activities unrelated to the expansion of output and the enhancement of productivity Creating a nationwide system of entrepreneurial finance Reinventing and multiplying the GSEs Generalizing “high finance” to the US financial system as a whole Restructuring as experimental reinvention

The alternative futures of finance and the programmatic agenda of progressives in the US and elsewhere The imperative of structural vision Worked out at an intermediate level, for example, in the organization and governance of financial markets The importance of confronting and reshaping the prevailing understanding of financial crisis, recovery and reform Using materials and examples from the progressive tradition in American politics, political economy and legal thought (viewed in comparative and historical perspective)