Crisis simulation – US experts play at global meltdown
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Crisis simulation – US experts play at global meltdown

It’s July 2000 and the world economy is in crisis. Who will save it? The US cavalry of course. Sixty grown men and women, some of them high rankers in the US government or civil service, spent a full Saturday in a New York mansion, wrestling with a hypothetical global meltdown, sending frantic messages from room to room, while the snow fell outside.

By David Shirreff


Russia is close to invading Ukraine, which has repudiated its foreign debt; Brazil has agreed to pay the European banks but refuses to pay the Americans; the equity derivatives market is thrown into chaos by a UK insurance subsidiary; thousands of Americans are suing their pension funds for being overweight equities when the stock market dived.


These are just a handful of the crises that hit four teams of US policy-makers as they sat in their respective rooms trying to hammer out a response - for the White House, for Congress and for the American people.


The setting was the imposing Harold Pratt house on the upper east side of Manhattan, headquarters of the US Council on Foreign Relations (CFR), a body founded in 1921. These modern policy-makers bent to their task were watched quizzically by the busts and portraits of their illustrious predecessors - Cyrus Vance, David Rockefeller, Walter Mallory and General Tasker H Bliss.


Why were they doing it? The CFR decided its members should pay more attention to financial and economic crises. This is a way of "forcing us to think our way through high-cost, low-probability events" says CFR senior research fellow Roger Kubarych, who led the project.





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