Increasingly during the current financial crisis, reporters have been banking on Simon Johnson for analysis and advice.
Johnson, a professor at MIT’s Sloan School of Management, is not only willing to answer when the media call, he also has something to say.
Drawing on his time at the International Monetary Fund, Johnson speaks with authority on the steps governments might take when banks go bad.
Simon Johnson
“We need to encourage or, more likely, force the large insolvent banks to break up,” Johnson wrote last month in his blog, The Baseline Scenario. “Their political power needs to be broken, and the only way to do that is to pull apart their economic empires.”
Johnson founded The Baseline Scenario with James Kwak, a former consultant at McKinsey & Company and the founder of Guidewire Software who is now a student at Yale Law School.
Peter Boone of the London School of Economics also contributes to the blog.
The Baseline Scenario’s mission is to explain issues related to the global economy and to propose solutions to the current mess.
The authors include a section entitled “Financial Crisis for Beginners.”
“If you’re confused, this page is for you,” they write, before trying to explain in clear English such mind-numbing concepts as credit default swaps and bank recapitalization.
A wide of variety of media have asked Johnson to do this kind of explaining for their readers, viewers or listeners.
The NPR podcast and blog “Planet Money,” a project devoted to clarifying the obscure, has turned to Johnson several times. He’s also been on “Bill Moyer’s Journal.”
Johnson has been quoted in many newspapers including The Christian Science Monitor and The Washington Post.
Joe Nocera, a business columnist for The New York Times who has also proven to be a clarifying voice during the financial crisis, turned to Johnson in January to help define recapitalization, the injection of billions of dollars into banks by the government in order to balance the banks’ books.
“It’s not rocket science,” Johnson said. “When you do a recap, you need overkill. But then, you also have to take the bad assets off the books.”
A native of England with degrees from Oxford University, the University of Manchester and MIT, Johnson assumed his professorship at MIT in 2004.
In March 2007, he took a leave from MIT to work at the IMF, staying there until August 2008.
He’s also a senior fellow at the Peterson Institute for International Economics in Washington.
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