Rethinking Financial Regulation for the 21st Century

This event was joint with GW Law Business and Finance Law program and featured Professor Emeritus Arthur E. Wilmarth, Jr. and discussant Professor Erik Gerding.

The financial crisis of 2007-09 and the pandemic crisis of 2020 showed that global financial markets are dangerously unstable. Those markets are dominated by “too-big-to-fail” universal banks – commercial banks that engage in capital markets activities – and large shadow banks, such as private equity firms, securities broker-dealers, and hedge funds. Governments and central banks rescued financial markets in 2008 and 2020 with enormous bailouts and unconventional monetary policies. Those policy measures produced soaring global debt levels, aggressive risk-taking by investors, heavily indebted sovereigns, and bloated central bank balance sheets. In addition, large technology companies are seeking to enter the banking business, a development that could transform the banking industry and extend government bailouts for banks across our commercial economy. The seminar discussed regulatory policies that would return our financial system to a structure that is much more stable and far less dependent on government bailouts.

This webinar was moderated by Dr. Sunil Sharma, Distinguished Visiting Scholar at the Institute for International Economic Policy, with introductory remarks made by IIEP Co-Director Jay Shambaugh and Director of the Business and Finance Law Program at the George Washington University Law School Jeremiah Pam. This event was co-sponsored by the GW Law School’s Business and Finance Law Program and the Institute for International Economic Policy at GWU.

About the speaker:

Arthur E. Wilmarth, Jr. joined the GWU faculty in 1986, after 11 years in private law practice. Prior to joining GW Law’s faculty, he was a partner in the Washington, DC, office of Jones Day. During his 34 years as a member of the faculty, Professor Wilmarth taught courses in banking law, contracts, corporations, professional responsibility, and American constitutional history. He served as Executive Director of the Center for Law, Economics & Finance from 2011 to 2014.
Professor Wilmarth is the author of Taming the Megabanks: Why We Need a New Glass-Steagall Act (Oxford University Press, 2020), and co-editor of The Panic of 2008: Causes, Consequences, and Implications for Reform (Edward Elgar, 2010). He has published more than 40 law review articles and book chapters in the fields of financial regulation and American constitutional history. In 2005, the American College of Consumer Financial Services Lawyers awarded him its prize for the best law review article published in the field of consumer financial services law during the previous year.
Professor Wilmarth has testified before committees of the US Congress, the California legislature, and the DC Council on financial regulatory issues. In 2010, he was a consultant to the Financial Crisis Inquiry Commission, the body established by Congress to report on the causes of the financial crisis of 2007-09. During 2008-2009, he served as Chair of the Section on Financial Institutions and Consumer Financial Services of the Association of American Law Schools, after serving as the Section’s Chair-Elect and Annual Program Chair during 2007-2008. Professor Wilmarth is a member of the international advisory board of the Journal of Banking Regulation, published by Palgrave Macmillan Ltd. He is also a member of the advisory board of the American Antitrust Institute.

About the discussant:

Erik Gerding is a Professor at the University of Colorado Law School. His research interests include securities, banking law, the regulation of financial markets, products, and institutions, payment systems, and corporate governance. His research also focuses on the application of technology to financial regulation, including analyzing the use of technologies in governing financial markets. Professor Girding’s book Law, Bubbles, and Financial Regulation (2014) examines the interaction of asset price bubbles and financial regulation. Prior to joining academia, Professor Gerding practiced law in the New York and Washington D.C. offices of Cleary Gottlieb Steen & Hamilton LLP. His practice at the firm included representing clients in the financial services and technology industries in an array of financial transactions and regulatory matters.

About the moderators:

Sunil Sharma is a Distinguished Visiting Scholar at the Institute for International Economic Policy, Elliott School of International Affairs, The George Washington University, Washington, D.C., USA, and a Senior Associate at the Council on Economic Policies, Zurich, Switzerland. He was Assistant Director in the IMF’s Research Department from 2015-2018, and the Director of the IMF- Singapore Regional Training Institute (STI) in Singapore from 2006-2015. Before moving to Singapore in 2006, he was Chief of the IMF Institute’s Asian Division in Washington, D.C. Prior to joining the IMF in 1992, Dr. Sharma was on the Economics faculty at the University of California, Los Angeles (UCLA). He has a Ph.D. and M.A. in Economics from Cornell University, a M.A. from the Delhi School of Economics, and a B.A. (Honors) from St. Stephen’s College, Delhi University. His current interests include rethinking capitalism and democracy, systemic hazards, complex systems, the international financial architecture, and the institutional structure and design of financial regulation.

Jay Shambaugh is Professor of Economics and International Affairs, and Co- Director of the Institute for International Economic Policy at the Elliott School of International Affairs, George Washington University. His area of research is macroeconomics and international economics. He has had two stints in public service. He served as a Member of the White House Council of Economic Advisors from 2015-2017. Earlier, he served on the staff of the CEA as a Senior Economist for International Economics and then as the Chief Economist. He also spent 3 years as the Director of the Hamilton Project at the Brookings Institution. Jay is also a Faculty Research Fellow at the NBER and Non-Resident Senior Fellow in Economic Studies at Brookings. Prior to joining the faculty at George Washington, Jay taught at Georgetown and Dartmouth and was a visiting scholar at the IMF. He received his Ph.D. in economics from the University of California at Berkeley, an M.A. from the Fletcher School at Tufts, and a B.A. from Yale University.

Jeremiah Pam is the Director of the Business and Finance Law Program at George Washington University Law School. He has extensive work experience in international affairs and international crises, including six years practicing in international finance and sovereign debt restructuring at Cleary Gottlieb Steen & Hamilton LLP in New York, followed by government service as a financial diplomat and strategist with the Treasury Department in Baghdad and Washington, and with the State Department in Kabul. Mr. Pam teaches courses on financial stability, international crises, and economic and technological innovation. He also served for four years as a U.S. Air Force officer prior to law school. Mr. Pam received a JD from Columbia, an MBA from the Massachusetts Institute of Technology, an MA in Political Science from Columbia, and an AB from Harvard.