Georgia’s U.S. Sen. Johnny Isakson and the European Commission’s Anthony Smallwood both see no quick solution to the current global financial crisis, but they came to understand its extent in different ways.

The two men met during an Atlanta Press Club luncheon at the Commerce Club downtown on May 11. Mr. Isakson was the luncheon speaker and Mr. Smallwood was in town to celebrate “Europe Day” at the European Union Center of Excellence at the Georgia Institute of Technology.

Following the luncheon, they both participated in a GlobalAtlanta video interview during which they recounted their concerns about the scope of the crisis.

Mr. Isakson traced his recognition of the extent of the crisis to a bipartisan trip he made with Senate Majority leader Harry Reid in Europe and Central Asia to study climate change and nuclear waste issues in August of last year.

While in Astana, the capital of Kazakhstan, he was struck by the number of cranes and construction projects, and then noticed that there was no activity at any of the sites for high-rise and mid-rise buildings.

He asked then-U.S. Ambassador John Ordway why all the construction had come to a halt and was told that Kazakhstan’s main bank had invested heavily in U.S. sub-prime mortgages and was suffering the consequences.

“What a small world we live in,” he said at the luncheon, pointing to the scope of the crisis.

Kazakhstan had oil resources and had had enough capital to build Astana from scratch in just 10 years, he noted, but now was suffering along with many other places in the world.

Mr. Smallwood is the press and cultural counselor at the European Commission’s Delegation in Washington. He  said that he knew Europeans, who had upon learning of the crisis experienced briefly a feeling of “schadenfruede,” a German expression for a mild sensation of delight derived from the suffering of another.

But those feelings quickly passed when Europe’s financial institutions realized that they also were vulnerable and that the crisis would reach throughout Europe, even sacking the savings of pensioners in the smallest of villages.

During the luncheon, Mr. Isakson said that he and U.S. Sen. Kent Conrad, a Democrat from North Dakota, felt compelled to propose a Financial Crisis Inquiry Commission to fully investigate the causes of the economic collapse.

On May 19, Congress passed a financial fraud bill including their proposal for the 10-member bipartisan commission that is to have subpoena power and the authority to refer to the U.S. attorney general and state attorneys general any evidence that institutions or individuals may have violated existing laws.

While the commission may get to the root of the causes, Mr. Isakson predicted that it will take five years before the U.S. economy reaches “a new normal,” which he defined as including full employment, a restored savings rate, participation by investors in the markets once again and a concern about deficit spending.

Mr. Isakson also called for a review of the deregulation of the banking industry including the Gramm Leach Bliley Act of 1999, which dismantled aspects of the Glass-Steagall Act of 1933 that had regulated banks during the Great Depression into the 1990s.

Mr. Smallwood said that he hoped for a recovery based on the development of new sustainable technologies that will help ease unemployment through the development of new “green jobs.”

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