John Taylor (famous for the Taylor rule for determining central bank interest rates) moved from academia into government with the election of the Bush administration, taking the role of Treasury Undersecretary for International Affairs. This book tells the story of his experiences in that role post 9/11. It is a fascinating insight into how 9/11 changed the role of the Treasury department, from one of the usual international policy issues, currencies, G7, IMF etc, to one of crisis management of all issues stemming from the war on terror. There are plenty of insights into how the Treasury (and John Taylor in particular) were involved in making key changes to the IMF, World Bank and currency management during his time in the post. The focus however, is much more one of how Treasury staff had to turn themselves into ‘Financial Warriors’ to cut off funding for terrorists and assist the new Afghan and Iraqi governments in building sustainable financial institutions and stable economies.

The book starts with the response to the attack of 9/11 and runs through how the Treasury had to act with real haste but also with carefully choreographed planning to freeze the assets of terror organisations and Al Quaeda in particular. Taylor provides a real insight into how this coordination had to be carried out and how the US used its influence and power to force the issue. He describes the setting up of a war room and how that war room coordinated the response both across the US government and the rest of the world’s key financial institutions.

Perhaps the most fascinating chapters are those on the reform of the World Bank (and the associated push for debt relief for the poorest nations) and the financial restructuring of Iraq after the US led invasion – undoubtedly key achievements of Taylor’s time as Undersecretary. The game theory in the negotiations to secure the appropriate amount of debt relief and the replacement of lending by grants is interesting to follow.

Where the financial warriors were most involved at the sharp end, though, was in Iraq. He describes how the Treasury’s team arrived in Baghdad in the immediate aftermath of the US victory to try and pick up the pieces, amidst all the broken glass, dust and rubble. Here his warriors really did have to be on the ground to pay the Iraqi workers, track down the records of the central bank, help put in place a new financial system and issue a new currency.

Throughout the book Taylor emphasises the need for game plans, clear organisational structure and a sense of mission in whatever he set out to achieve. This he argues was crucial in cutting through international financial bureaucracy. In doing this he seems to have made a clear decision to carry over his beliefs from academia into government, with a clear preference for rules over discretion.

The book is a valuable insight into the post 9/11 events from a financial perspective. It is not only a source of interesting information, but also well written and an easy read. My only reservation is that the author leaves the impression that his plans were almost always successful. With that one caveat, I can recommend it to all who have an interest in international finance at the sharp end.

James Barty

Head of Macro Strategy, Omnis, Deutsche Bank