WAYNE SWAN MP
MEMBER FOR LILLEY
SBS WORLD NEWS
SATURDAY, 15 SEPTEMBER 2018
SUBJECTS: Global Financial Crisis, Collapse of Lehman Brothers, Fiscal Stimulus.
HOST: It’s ten years since the collapse of US Bank Lehman Brothers – widely seen as the pivotal event of the Global Financial Crisis. A decade on, it’s feared the seeds of another crisis are growing, with not enough lessons learned from that tumultuous period.
RENA SARUMPAET: Fort Myers, Florida, back in 2008, dubbed ground zero for America’s great recession. In one district, nearly half of the properties foreclosed. Ten years on, a booming economy sees house prices here up, unemployment below the national average. But the scars linger.
NATALIA: I have two jobs plus an internship. Getting 4-6 hours of sleep.
SARUMPAET: Over in London, Natalia, now a pasta chef, but once a young Lehmans banker. Joining 2.6 million Americans made jobless in 2008 alone. The GFC began with sub-prime mortgages in America. A banking credit squeeze made it a financial crisis. Then an economic one, as the US Congress rejected President Obama’s bailout bill in late September.
In Australia, then Labor Treasurer Wayne Swan stands by the government’s actions, guaranteeing bank deposits and issuing a massive stimulus package.
WAYNE SWAN, MEMBER FOR LILLEY: They saved Australia from recession, and the fact other countries did not engage in stimulus as large as ours, and didn’t provide the sort of protection for the financial system we did, they experienced anaemic growth for years and years.
SARUMPAET: Beneath the record stock values, widespread fears that the seeds of another crisis are in place. Rising interest rates are already pressuring emerging economies like Argentina and Turkey.
ANALYST: The next crisis will be a debt crisis. And that will be the biggest crisis ever. Global debt is far higher than in 2008.
SARUMPAET: Britain’s Gordon Brown says since 2008, only the small things were dealt with, with penalties still unclear, and no early warning system.
GORDON BROWN: People became complacent again, and I feel we’re sleepwalking into the next crisis.
SARUMPAET: Wayne Swan has a wishlist of measures to crisis-proof the Australian and global economies.
SWAN: Government should be willing use the force of fiscal policy to protect their people, when markets are a threat. The ongoing need for strong regulation of the financial sector. And more generally, more international cooperation co-operating between larger countries to secure collective efforts to avoid those disasters.
SARUMPAET: A message, he says, for President Trump, amid growing protectionism and moves to wind back banking regulation.
MEDIA CONTACT: DANIEL DE VOSS 0403 775 158
Authorised by Noah Carroll, ALP, Canberra