J. Dennis Hastert Center for Economics, Government and Public Policy FA

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The Political Economy of Latin America: Iron Sharpens Iron Study Abroad Program 2011

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This summer, a select group of

International Relations majors and

Business and Economics majors delved into

an intensive study of the political economy

of Latin America through the Hastert Center

sponsored Iron Sharpens Iron program. This

innovative curriculum gives students the

opportunity to study first hand comparisons

of business and economic policy across

a broad range of countries. ISI 2011 was

The Iron Sharpens Iron group visits the Central Bank of Chile. Pictured from left to right, (front row, back row): Linda Norton, Seth Norton, Joshua Warnet, Libby Strachan, Lauren Hanson, Annie Chestnut, Kevin Skinker, Jared Falkanger, Nate Hatton, Joshua Steddom, Daniel Watts, Mark Amstutz, and Juan Laval, deputy head of legal services at the Central Bank of Chile.

designed to give students analytical tools to understand the unique political economy of Latin America and to examine effective business strategies and sound economic policies in this region. Students in the program enrolled in 8 semester credits of specialized coursework on globalization, business strategy and politics with an emphasis on practices in Argentina, Chile, Peru and Ecuador. A key feature of the program was to illustrate the ways in which the economic policies of different nations have affected development. For example, since the 1980s, the government of Chile has adopted polices supporting privatization and encouraging foreign competition. These practices have strengthened the Chilean economy and the presence of foreign competition has put pressure on local firms to raise quality and contend in the market place. The Chilean economy is now ranked number one in Latin America. Chile has the highest nominal GDP per capita in Latin America and in the last 30 years Chile has halved poverty rates. Seth Norton explained that one of the major problem areas for Latin America, in general, has been hyperinflation. “One of the great successes of Chile

It has been a busy summer at the Hastert Center. In May I taught a course on the globalization of Latin America for the Iron Sharpens Iron program. In June my wife, Linda, and I travelled with the ISI students to Argentina and Chile. We had the pleasure of visiting many commercial and government sites in these countries including the Argentinean cattle auction and the Central Bank of Chile. We were a bit delayed in getting to Chile from Argentina because of a volcano that erupted in southern Chile, but we eventually made it and once we were on the ground our travels went smoothly. It was pleasure to spend time with a great group of students and a delight to watch as they learned about Latin American political economy and the direct effects of government policy on economic success. Upon my return I continued preparation for the Equipping Strategic Professors program where we hosted two sessions of the derivatives training course in late July. Michael Hemler from the University of Notre Dame served as the primary instructor. Representatives from 27 schools participated in this workshop. We were pleased to have guest lectures from Joe Ritchie, Wheaton (class of 1969). Joe has had long distinguished career in commodities and options trading and was the founder of trading firm, Chicago Research and Trading. Joe addressed the appropriate roles of derivative pricing models and the demands for humility and personal discernment to survival in competitive markets. One of the highlights of the program was a visit to the Chicago Mercantile Exchange and the Chicago Board Options Exchange to observe live trading. By all measures, the program was a notable success. Almost all the participants are planning to revise current courses to include derivative and futures market education. Others are even planning to add new courses specifically on the topic. As we move to the fall 2011 calendar, we are pleased to announce a number of stimulating events. One of the themes we are exploring this fall is poverty, development and human dignity. On September 14 &15 we hosted part one of a symposium on this topic. Paul Collier, Director of the Centre for the Study of African Economies at Oxford University, gave a keynote address on September 14 on the topic of his most recent book, The Plundered Planet and the Poorest Countries. Collier is currently advisor to the Strategy and Policy Department of the International Monetary Fund, and advisor to the Africa Region of the World Bank. He provided a thought provoking address on innovative methods of development in the majority world. This lecture was well attended. In November, we will host part two of the symposium on development and human dignity which will feature addresses by The Honorable Joyce Banda, Vice President of Malawi and microfinance entrepreneur, as well as Erica Field, professor of economics at Harvard University and emerging young scholar on economic institutions and entrepreneurship. The November symposium will include daytime roundtable sessions with students and featured speakers. Please contact Grace Dyck at the Hastert Center for information on the full symposium schedule. We are sponsoring other events this fall on topics ranging from the nation’s fiscal imbalances to transportation and energy. Details can be found in the later pages of the newsletter. As always we welcome your feedback and inquiries. Best Wishes for a productive fall season!

Seth W. Norton

Director’s WelcomeSETH W. NORTONDirector, J. Dennis Hastert Center for Economics, Government, and Public Policy

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The ISI group visited the renowned Christian radio station in Quito, Ecuador, HCJB and a few of the students were asked to help with a show. Jared Falkanger, Nate Hatton and Joshua Warnet are pictured here responding to a call in. ISI faculty member Annette Tomal explains “HCJB Radio was started in 1927 by a Chicago trombonist from Chicago Tabernacle. At one time, they were broadcast to 80% of the world from Quito through short-wave radio. Before the Iron Curtain fell, some of the programming included reading the Bible, so that Russian listeners could hand-write copies of the Bible. Currently, this is being done for Chinese listeners. The ministry started a teaching hospital that accepts anyone in need of medical care (the only hospital in Quito that does that). They currently produce 24-hour programming that is downloaded by radio partners around the world.”

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in recent years is that when they reformed their government, they made their central bank independent. Chile has one of the most independent central banks going” said Norton. Students were able to see the strength of this system first hand. They were able to juxtapose the economic policies of different nations and directly see the ways that those policies affect business and development. The first component of the program was intensive coursework, guest lectures and field trips conducted while on the Wheaton College campus from May 10-June 4. The group visited three corporations during the on-campus portion of the trip. Site visits were made to Caterpillar Inc., FONA International and Dover Corporation factory. These site visits introduced students to a range of American business activities and strategies. The students acquired a cognitive map for business activities so they could understand business generally and have a framework for understanding Latin American business. “This was the first time many of these students had ever been in a factory or manufacturing plant” said Greg Bunch who taught business and global strategy to the students. The on-campus portion of the program also featured guest lectures by William Pollard and Floyd Kvamme, Hastert Center Advisory Board members and business leaders. Pollard spoke on the goals of economic activity and the

role of culture in economic life and the varieties of the Latin American economic experience as well as biblical foundations for economic life. Kvamme spoke about entrepreneurial finance and the funding of both new and established businesses. Kvamme also stressed the development of the venture capital business in the United States and Europe and comparable institutions in Latin America. The second component of the Iron Sharpens Iron program entailed travel to Argentina, Chile, Peru and Ecuador from June 4-July 1. Approximately 45 site visits/lectures were scheduled in Latin America. The group met with corporations, NGOs, government agencies, financial institutions, research organizations or “think tanks,” local universities, and members of political parties. The group also visited numerous historical and cultural sites. Some of the highlights were visits to a cattle auction and fish processing plant in Buenos Aires; meeting with Dr. Carlos Ferrero, the former Prime Minister of Peru; academic briefings at the US embassy in each country, and visiting the Institute for Liberty and Democracy founded by Hernando De Soto. Students were overwhelmingly positive in their feedback of the program. Junior, Libby Strachan said “I learned much more than I expected. Getting to visit the countries and speaking to native individuals made for a once in a lifetime learning experience.”

Going Global FEEDBACK FROM HASTERT INTERNS AND SCHOLARS

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Samantha Hinkle’s (International Relations ’12) internship was with Amani ya Ju, a not for profit based in Kenya. The organization is a sewing and reconciliation project for marginalized African women.

1. What was the most helpful insight you gained from being involved as a Hastert Intern and why would you recommend this type of experience to other students?

The Hastert Intern program has enabled me to learn about international business in East Africa. I recommend this experience to other students because it is an incredible opportunity to collaborate with Wheaton College and the Hastert Center to complete a unique internship and gain ground level experience.

2. What skills did you learn this summer that you consider most valuable?

This summer I learned about doing business in Africa in a holistic manner. Though I did not pick up one specific skill, I learned an array of business techniques, including how to do business in a cross-cultural setting.

3. Did your internship experience help you confirm or reject your progress in your career plans?

My internship experience has helped me progress in my career plans; though I have no intention to work with another sewing project, I would like to continue to work with women in post-conflict setting.

Adam Sawyer (International Relations ’12) completed his internship on property rights with the Asociación para una Sociedad más Justa in Honduras. This picture was taken at a group workshop concerning the various steps of property regularization.

1. What was the most helpful insight you gained from being involved as a Hastert Intern and why would you recommend this type of experience to other students?

Even though the classroom environment can be a place of preparation and learning, the professional work place is a totally different ball game. Using time effectively requires creativity, initiative, and organization skills.

2. What skills did you learn this summer that you consider most valuable?

I continue to grow in appreciation for the opportunity to acquire competence in Spanish. Having bilingual proficiency is ever more important in participating in the application of political and economic justice.

3. Did your internship or scholar experience help you confirm or reject your progress in your career plans?

I am still discerning whether I want to pursue the human rights lawyer career path that I was considering upon arrival. A degree in Public Administration might be in my future.

Chelsea O’Donnell’s (English ’13) internship was with Senator Olympia Snowe.

1. What was the most helpful insight you gained from being involved as a Hastert Intern and why would you recommend this type of experience to other students?

I worked with the Senator’s speechwriter and thus spent a good deal of time focused on the creation of a speech and the refinement of prose for political purposes.

2. What skills did you learn this summer that you consider most valuable?

I was not familiar with political databases at the beginning of the summer. I learned to navigate them fairly quickly however, and out of necessity, while doing projects for senior advisors on pieces of upcoming legislation.

3. Did your internship experience help you confirm or reject your progress in your career plans?

My internship this summer has influenced me away from pursuing a career on the Hill. I have learned much from the experience and am grateful for the exposure that it has given me to the legislative side of government. However, the tedium and brokenness of the legislative process has shied me away from pursuing a career on the Hill.

Emma Bayer’s (Political Science ’13) internship was with the Republican Study Committee.

1. What was the most helpful insight you gained from being involved as a Hastert Intern and why would you recommend this type of experience to other students?

The Hastert Intern program added a unique focus to my internship. It encouraged me to actively seek events and opportunities on Capitol Hill that would contribute to my understanding of both the theoretical and practical aspects of political economy and its relationship with energy policy.

2. What skills did you learn this summer that you consider most valuable?

This summer, I learned a variety of skills. Through experiencing the fast-paced climate of a Congressional office, I was forced to prioritize tasks and work at a rate of high efficiency. I mastered many office skills and learned the importance of a first impression and of networking.

3. Did your internship experience help you confirm or reject your progress in your career plans?

My internship helped to confirm my progress in my career plans as I saw the intersection of my two areas of interest become a viable career option. Through the Hastert Intern program I was able to focus on my policy interest in energy’s role in American global competitiveness.

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Jeremiah Coogan (Political Science ’13) and his faculty mentor Dr. Bryan McGraw analyzed different evangelical opinions concerning economic justice. Jeremiah explained that through reading and conversation over the summer, he discerned four growing theological influences within the evangelical world (liberation theologies, Kuyperian sphere sovereignty, Catholic subsidiarity, and “progressive” dispensationalism), each of which contributes to a more

“transformationalist” conception of economic good. He and Dr. McGraw finished the project by shaping these observations into a publishable report titled “Shifting Evangelical Conversation on Economic Justice.”

1. What was the most helpful insight you gained from being involved as a Hastert Scholar and why would you recommend this type of experience to other students?

Yes, I would! My biggest insights were of the complexities involved in public policy argument. My research this summer taught me to look deeper for underlying similarities and differences, rather than simply looking at the specific actions advocated.

2. What skills did you learn this summer that you consider most valuable?

The project has dramatically expanded and challenged my ability to synthesize large amounts of written material. The task of reading arguments in dozens of articles and books and being able to chart the relevant material into a single narrative exceeds by far my previous experiences.

3. Did your scholar experience help you confirm or reject your progress in your career plans?

My research this summer confirmed my plans. My objective has been and remains involvement in theological education, with an emphasis on Biblical ethics. This project falls closely in line with that vision.

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Event Announcements

On September 14, 2011, Dr. Paul Collier, Director of the Centre for the Study of African Economies, addressed an audience of 250 Wheaton students and community members about the topic of his newest book The Plundered

Planet and the Poorest Countries. Dr. Collier spoke about the challenges that the world’s poorest countries face in managing their natural resources and creating sound policy to find sustainable solutions for economic investment and industrialization of these resources. Dr. Collier is currently advisor to the strategy and policy department of the international monetary fund and an advisor to the Africa Region of the World Bank. Professor Sandra Joireman said of the event “It was fantastic to have such a prominent public intellectual on campus. Paul Collier’s work is of tremendous importance to the poorest people in the world.”

Panel Discussion on Fiscal Imbalances October 20, 2011, 7:00 pmBarrows Auditorium. Panelists include Former Speaker J. Dennis Hastert, Congressman Bobby Rush, Andrew G. Biggs of the American Enterprise Institute, and Casey B. Mulligan, economics professor University of Chicago. Michael Gerson, Washington Post columnist and Hastert Fellow, will moderate the discussion.

Development and Human Dignity: Part 2 November 16, 2011, 7:00 pmBarrows Auditorium. Erica Field, Economist from Harvard University will give an address on property rights in the developing world.

Erica Field is the John L. Loeb Associate Professor of Social Science (Economics) at Harvard University. She specializes in Development Economics and will address the advent of well specified property rights on the human well being of impoverished people.

Paul Collier speaks to the Wheaton community about Poverty and Development

The Chicago area has long been known as a leader in economics and finance. The area boasts a thriving stock exchange, numerous investment and portfolio management companies, the famous University of Chicago School of Economics, (home to an astounding number of Nobel laureates), and the Chicago Mercantile Exchange, the world’s leading derivatives marketplace. The city of Chicago has left a historic imprint on the field of economics and the Hastert Center is pleased to exist within an environment of such dynamic research and practice. In fact, many of our graduates go on to study advanced political economy or begin careers in the field of finance and investment. Wheaton College has provided an early training ground for numerous leaders in the finance industry. One of the primary goals of the Hastert Center is to connect the training of economics with politics to strengthen the knowledge base of leaders in both fields. Speaker Hastert says it best, “the vision is to integrate economic analysis with political analysis to address the major challenges to the economy, public policy and ethics in the coming generations.”

This summer, a generous grant from the Chicago Mercantile Exchange Foundation enabled the Center to provide this integrative training on a unique sub-field of finance and economics. The Center offered two one-week long training programs to professors from area liberal arts colleges on the important, but often misunderstood, field of derivatives and futures markets. The program entailed a one week course for professors of business, economics, and finance that addressed the economic foundations of derivatives, futures, and options markets in today’s global economy. Participants visited the major exchanges in Chicago, engaged in classroom experiments, group discussions, guest lectures, and advanced readings. The course was taught by Michael Hemler, Associate Professor of Finance at the University of Notre Dame. A total of 35 professors from a variety of Midwestern liberal arts colleges enrolled in the training program. The primary goal of the program was to increase the knowledge base of professors on the topic of derivatives so that they can strengthen their course offerings and continue to develop their student’s understanding of these issues.

Equipping Strategic Professors: A Training Program on Derivatives and Futures Markets

The derivatives training program attracted professors from liberal arts colleges throughout the Midwest. Wheaton College hosted the first group of 22 professors from July 10-15. A second cohort came the following week. The first group is pictured here with guest speaker, Joe Ritchie (center, middle row), a Wheaton College alumnus and a globally recognized leader in the derivative and finance industry.

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The J. Dennis Hastert Center for Economics, Government, and Public Policy

Wheaton College501 College AvenueWheaton, IL 60187Phone: 630-752-5975Fax: 630-752-5731www.wheaton.edu/hastertcenterhastertcenter@wheaton.edu

MISSION STATEMENT

The J. Dennis Hastert Center for Economics, Government and Public Policy exists to advance the training of Wheaton College students and the greater community in the understanding of market economies, representative democracies, limited government, and the redeeming effects of the Christian worldview on the practice of business, government and politics.

Hastert Center Program SupportHastert Center programming is made possible through the generosity of friends who partner in its vision to advance the training of

Wheaton College students in the understanding of market economies and representative democracies. If your stewardship priorities

resonate with Hastert Center programs, please contact the Center at hastertcenter@wheaton.edu or 630-752-5975. Your investment in

the Hastert Center will have a dramatic effect on students who will make a difference in the marketplace for Christ and His Kingdom.

PG 1 The Political Economy of Latin America: Iron Sharpens Iron Study Abroad Program 2011

PG 2 Director’s Welcome

PG 4 Going Global

PG 6 Event Announcements

PG 7 Equipping Strategic Professors: A Training Program on Derivatives and Futures Markets

Fall 2011 Edition

For further information, please contact Grace Dyck at 630-752-5975 or write to hastertcenter@wheaton.edu.