Guest Speaker Rivlin Expresses Concern for Economy

Author: Caroline Stauffer

Alice M. Rivlin spoke in the Robert A. Jones Conference Room on "Greed, Ethics, and Public Policy" on Monday afternoon. Rivlin is the founding director of the Congressional Budget Office, which she headed from 1975 to 1983, and was the director of the White House Office of Management and Budget from 1994 to 1996 during the Clinton administration. She also served as the vice chair of the Federal Reserve Board from 1996 to 1999. Currently she works with the Brookings Institution in Washington, D.C.
To begin the lecture, Alison Stanger, director of the Rohatyn Center for International Affairs, introduced Bicentennial Scholar-in-Residence Madeline Kunin. Kunin, a long-time friend of Rivlin, praised Rivlin's ability to "combine the academic with the practical."
Rivlin's lecture was a message of caution for the current state of affairs in the American economy.
Her concerns were two-fold. First, she voiced her apprehension of the corporate scandals such as those involving Enron and Tyco. Second, she expressed alarm at the growing division of wealth in the country.
"Significant factions are being left out and left behind," she said.
Rivlin voiced her support for democratic government and free market capitalism, but warned that both are demanding institutions. She cited corruption as "the seedy side of capitalism," and emphasized the necessity of protecting low-wage workers from the tyranny of the wealthy. She connected the two systems of capitalism and democracy by noting that both "placed a premium on honesty and leadership."
The same traits that make successful leaders in a capitalist economy, however, can also intensify the problems of corruption, according to Rivlin. Great business leaders in both the public and private sectors tend to be extremely persuasive and successful in portraying the optimistic side of affairs, sometimes to the point of denial.
They also tend to be risk takers and fiercely competitive people. Rivlin blamed the media for excessive focus on corporate profit, almost turning corporate leaders into heroes.
Rivlin also emphasized the realm of uncertainty.
The ability to predict events in the world continues to be limited even with revolutionary technology. Thus, predicting economic and geopolitical change remains difficult.
Rivlin ended her lecture by addressing her second concern -- the increasing struggle for low-wage workers to make ends meet. She questioned how in representative democracies, policies could benefit individual corporations.
The lecture was sponsored by the Christian A. Johnson Foundation.