Does a Central Clearing House Reduce Systemic Risks?

During the Lehman debacle we learned that one of the many problems regarding the credit default swaps was the absence of a central clearing house. Tim Geithner and others are then defending the idea that the imposition of a clearing house would reduce systemic risk in the CDS markets.

However, as highlighted by the FT Alphaville, Darrell Duffie, one the leading scholars on the theme, argues that the size of the CDS markets ($27 trillions) is far too small to have any positive impacts in terms of decreasing systemic risks, as argued by Geithner.

Source: Central counterparties and CDS risk, a contrarian argument (FT Alphaville)