Blog Post

Tim Geithner and Europe’s phone number

According to a famous (yet apocryphal) joke by Henry Kissinger, there is no telephone number to call to speak to Europe. Indeed the fragmentation of European power and representation makes it difficult to determine who can speak for the EU or the euro area. US Treasury Secretary Tim Geithner however has found out with whom to speak to discuss responses to the euro crisis. This, at least, is what his official schedule indicates: from January 2010 to June 2012, the last date for which his calendar is publicly available, he had no less than 168 meetings or phone calls with Euro-area officials, plus 114 with the IMF. And the person he spoke most often with, apart from the IMF chief, was the ECB president.

By: Date: February 4, 2013 Topic: Global Economics & Governance

According to Henry Kissinger’s famous (yet apocryphal) joke, there is no telephone number for Europe. US Treasury Secretary Tim Geithner, however, seems to have resolved Kissinger’s dilemma by calling not one number but dozens. This, at least, is what his official schedule indicates: from January 2010 to June 2012, the last date for which his calendar is publicly available, he had no fewer than 168 meetings or phone calls with euro-area officials, plus 114 with the International Monetary Fund. And the person he spoke to most often, apart from the IMF chief, was the European Central Bank president.[1]

I had the idea to examine this data when I was recently asked to speak at a conference on the US and the euro-area crisis. I was looking for some sort of quantitative evidence of the involvement of the Obama administration in the European discussion, and thought the frequency of these contacts would provide an informative indicator. Obviously, the calendar does not indicate what the subject matter of discussions was. But what else could have justified 58 contacts in 30 months between Tim Geithner and the ECB’s successive presidents, Jean-Claude Trichet and Mario Draghi? Admittedly, he may have had a more diverse array of topics to discuss with German Finance Minister Wolfgang Schäuble (36 contacts) or his French counterparts (32 contacts). But why would have he called them significantly more than the UK Chancellor of the Exchequer (19 contacts), with whom euro-area issues must also have been discussed? The one institution with which he certainly addressed other issues is the IMF (114 contacts with successive Fund chiefs Strauss-Kahn and Lagarde, and deputies Lipsky and Lipton), but here again, knowing how concentrated on Europe the IMF has been in recent years, the euro crisis certainly featured high on the agenda.    

Figure 1 displays the distribution of contacts for the entire period. Three striking facts emerge:

  • First, the data confirm the key role played by the IMF and the frequency of contact it has with the US Treasury Secretary. Nevertheless, there were significantly more contacts with European policymakers (168 against 114), which can be regarded as indicative of the direct involvement of the US administration in European policy discussions;
  • Second, the ECB emerges on top of all European institutions, far ahead of the European Commission and even further ahead of the Eurogroup, for which only two contacts are recorded (a G3 conference call in March 2011 and Geithner’s participation in a Eurogroup meeting in Poland in September 2011). There is little doubt that for the US Treasury, “Mr Euro” is first and foremost the ECB president. This finding is especially striking, as the ECB’s institutional interlocutor is the Fed, not the US Treasury.;
  • Third, there have been many more bilateral contacts with the German and French finance ministers than with the European Commission or the chair of the Eurogroup. This confirms the driving role of major national capitals.

Figure 2 displays the number of monthly contacts distributed into three broad groups: European institutions, national governments, and the IMF. It indicates four episodes of intensive transatlantic consultations:

  • Before the agreement on the first Greek programme in May 2010. In March, Geithner had no fewer than 9 calls or meetings with Fund chief Strauss-Kahn;
  • In autumn 2010, in the run-up to the Irish programme. In November 2010, at a time of controversy between the IMF and the ECB over a possible bail-in of Irish bank creditors, Geithner had 5 contacts with the Fund and 5 with Jean-Claude Trichet;
  • From spring 2011 to end 2011 (with a short respite in late summer/early autumn). This was a period of intense discussions on the restructuring of the Greek debt and the search for a comprehensive response to an escalating crisis. The US administration was especially vocal on the so-called “firewall”. Contacts during this period were more frequent than ever before and involved all categories of European partner;
  • In spring 2012. During this period, in which discussions increasingly focused on the plans for a banking union, contacts with the Fund were relatively less frequent, in comparison to those with European institutions and national capitals. During this period Geithner had several contacts with his Spanish counterpart De Guindos, and with Italian PM and Finance Minister Mario Monti. 

Summing up, the data suggests constant and very active involvement on the part of the Obama administration in the search for solutions to the euro crisis. They also tell us who matters in Europe in the eyes of the US administration: clearly, the one European institution that really counts is the ECB. In spite of the complex governance arrangements in place, other European institutions matter much less than Berlin and Paris.  

Thanks to Julian Lentz for his assistance in the compilation of data.


[1] Excluding contacts with Mario Draghi prior to his appointment to the ECB. Draghi was chairing the Financial Stability Board, so presumably contacts up until November 2011 were devoted to G20 affairs.


Republishing and referencing

Bruegel considers itself a public good and takes no institutional standpoint. Anyone is free to republish and/or quote this post without prior consent. Please provide a full reference, clearly stating Bruegel and the relevant author as the source, and include a prominent hyperlink to the original post.


Warning: Invalid argument supplied for foreach() in /home/bruegelo/public_html/wp-content/themes/bruegel/content.php on line 449
View comments
Read about event More on this topic

Upcoming Event

Oct
11
08:30

EU - CELAC Economic Forum- Channels for a joint future

On 11 October Bruegel together with GIGA and Real Instituto Elcano will organise a conference on relations between the EU and the Community of Latin American and Caribbean States.

Speakers: Paola Amadei, Angel Badillo, Paulo Carreño King, Darío Chirú, Linda Corugedo Steneberg, Guillermo Fernández de Soto, Bert Hoffmann, Felipe González, Enrique V. Iglesias, Trinidad Jimenez, Emilio Lamo de Espinosa, Maryleana Méndez Jiménez, Federica Mogherini, Luicy Pedroza, Mario Pezzini, Mario Soares, Everton Vargas, Dylan Vernon and Guntram B. Wolff Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels
Read article More on this topic More by this author

Blog Post

Global Imbalances

The recent IMF’s External Sector Report highlighted the persistence of imbalances and a switch of imbalances towards advanced economies. We review recent contributions on this topic.

By: Silvia Merler Topic: Global Economics & Governance Date: September 21, 2017
Read about event More on this topic

Past Event

Past Event

14th Asia Europe Economic Forum (AEEF)

The 14th Asia Europe Economic Forum will be held in Seoul on 20-21 September 2017.

Topic: Global Economics & Governance Location: Seoul, Korea Date: September 20, 2017
Read about event More on this topic

Upcoming Event

Sep
26
12:30

Global Excess Imbalances: How worried should we be?

This event will discuss excess external imbalances, risks from current configuration of imbalances, and potential policy responses to help correct imbalances while supporting global growth.

Speakers: Gustavo Adler, Zsolt Darvas, Maria Demertzis and Luis Cubeddu Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels
Read about event

Upcoming Event

Sep
28
12:30

Unfinished business: The unexplored causes of the financial crisis and the lessons yet to be learned

At this event Tamim Bayoumi will present his upcoming book on the financial crisis, showing how the Euro crisis and U.S. housing crash were, in fact, parasitically intertwined.

Speakers: Tamim Bayoumi, Maria Demertzis and Aerdt Houben Topic: European Macroeconomics & Governance, Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels
Read about event More on this topic

Upcoming Event

Oct
2
10:00

Europe and Japan: Monetary policies in the age of uncertainty

The 5th Bruegel - Graduate School of Economics, Kobe University conference will focus on monetary policy.

Speakers: Kosuke Aoki, Ulrich Bindseil, Grégory Claeys, Zsolt Darvas, Ester Faia, Lex Hoogduin, Martin Hellwig, Miles Kimball, Eric Lonergan, Benoît Mojon, Tamotsu Nakamura, Marianne Nessén, Athanasios Orphanides, Wataru Takahashi, Tokiko Shimizu and Guntram B. Wolff Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels
Read article More on this topic More by this author

Opinion

Is China Deleveraging? Too Early to Cheer

This blog post was originally published on BRINK “Deleveraging” is the new buzzword in China. The leadership clearly wants to scale back its epic borrowing, but it is not necessarily ready to pay the price for it, namely, the price of having less support for growth. The question is whether the recent efforts of China’s leadership to […]

By: Alicia García-Herrero Topic: Global Economics & Governance Date: September 13, 2017
Read article More by this author

Podcast

Podcast

Surprising priorities for Europe and China

Bruegel’s Alicia García-Herrero and Robin Niblett of Chatham House discuss a new joint report on EU-China relations. How easy was it to find common ground with Chinese partners? And what should be the priorities for economic cooperation between Europe and China?

By: The Sound of Economics Topic: Global Economics & Governance Date: September 13, 2017
Read about event More on this topic

Past Event

Past Event

EU-China economic relations: looking to 2025

This event will see the launch of a report on EU-China relations and discuss issues such as trade and investment, industrial cooperation and innovation and global governance

Speakers: Victor Chu, Ian Davis, Alicia García-Herrero, Dame Clara Furse, Tony Graziano, Anatole Kaletsky, K.C. Kwok, Lawrence J. Lau, Ina Lepel, Hanna Müller, André Sapir, Robin Niblett, György Szapáry, Jean-Claude Trichet, Zhang Yansheng, H.E. Ambassador Yang Yanyi, Liu Xiangdong, Gunnar Wiegand, Guntram B. Wolff, Huang Ping and Elena Flores Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: September 13, 2017
Read article Download PDF More on this topic

Book/Special report

EU–China Economic Relations to 2025. Building a Common Future

The EU and China, as the world’s second and third largest economies, share a responsibility in upholding the rules-based, global free trade system and other forms of multilateral cooperation, especially on combating climate change. This report sets out the main conclusions of a research project between European and Chinese think-tanks, which addresses the prospects for the EU–China economic relationship. A Joint Report by Bruegel, Chatham House, the China Center for International Economic Exchanges and the Institute of Global Economics and Finance at The Chinese University of Hong Kong.

By: Alicia García-Herrero, K.C. Kwok, Tim Summers, Liu Xiangdong and Zhang Yansheng Topic: Global Economics & Governance Date: September 13, 2017
Read article More on this topic More by this author

Opinion

Hong Kong should add the euro to its dollar peg

Volatility offers an opportunity for the territory to rethink its strategy. With the economy now more synchronised with China than ever before, the dollar peg may no longer provide an accurate reflection of the real value of the Hong Kong dollar.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: September 12, 2017
Read article More on this topic More by this author

Blog Post

North Korea: sanctions and marketization from below

What’s at stake: despite Western sanctions, North Korea has been in the news all summer. The country was in the spotlight for the death of American student of Otto Warmbier in June, and for the frequent missiles tests in July and August. We review recent contributions on the impact of economic sanctions.

By: Silvia Merler Topic: Global Economics & Governance Date: September 11, 2017
Load more posts