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The three Crises of the Eurozone
The eurozone finance ministers agreed a new bailout for Greece last night; but this will not end the eurozone crisis. Over recent months, it has become increasingly challenging to keep track of what is going on, but as far as I can see we are caught in three overlapping crises that are becoming increasingly difficult to solve: [...]
Good and Bad Deficits
“Deficits are always bad,” thunder fiscal hawks. Not so, replies strategic investment analyst H. Wood Brock in an interesting new book, The American Gridlock. A proper assessment, Brock argues, depends on the “composition and quality of total government spending.” Government deficits incurred on current spending for services or transfers are bad, because they produce no revenue [...]
Ready or not, Transfer Union here we come
The tension of the interregnum is nearly unbearable. A United States of Europe is slowly evolving, like a new planet condensing from the clouds and dust of the cosmos. Yet its final form will take years to consolidate. Once a critical number of member states have ratified stricter fiscal and budget rules — becoming more [...]
Manufacturing Illusions
Suddenly, manufacturing is back – at least on the election trail. But don’t be fooled. The real issue isn’t how to get manufacturing back. It’s how to get good jobs and good wages back. They aren’t at all the same thing. Republicans have become born-again champions of American manufacturing. This may have something to do [...]
Greek Default does NOT equal Greek Exit
Perhaps the greatest enemy of the eurozone, at this particular juncture, is an erroneous assumption: that a Greek default is inextricably linked to a Greek exit from the eurozone. The problem with this assumption is twofold: First, it prevents Europe from escaping a trap of its own making. Secondly, it is false. By now, reasonable [...]
The Riddle of German Neo-liberalism
In late 2008, when the OECD countries had only just been hit by the credit crunch and Keynesians were arguing for a large stimulus package to offset private deleveraging, the German Finance Minister Peer Steinbrück launched an unprecedented attack on Gordon Brown, accusing him of ‘crass Keynesianism’ and claiming that economic stimulus would merely ‘raise [...]
Catastrophe Now: The Euro Runs its Course
In August 1982 the government of Mexico announced it could not service its debts. Thus began an unnecessary, creditor-enforced depression that would sweep Latin American, and usher in the “Lost Decade” with appalling human suffering. Thirty years later we replay this grim history in Western Europe. The sorry fate of the European Union demonstrates the [...]
The Uptick’s Downside
Since late last year, a series of positive developments has boosted investor confidence and led to a sharp rally in risky assets, starting with global equities and commodities. Macroeconomic data from the United States improved; blue-chip companies in advanced economies remained highly profitable; China and emerging markets slowed only moderately; and the risk of a [...]
Blogs
The Australian Labor Leadership Showdown is on
A showdown over the ALP leadership, and therefore the Prime Ministership, has been inevitable for some time, and Kevin Rudd has finally brought it on, resigning as Foreign Minister in the face of direct personal attacks from Simon Crean (himself, apparently, a covert contender for the top job) and others. Readers won’t be surprised to [...]
The Eurozone, the Ant and the Grasshopper
A Special Report commissioned by Channel 4 (UK), based on an earlier post in this blog entitled Never Bailed Out: Europe’s ants and grasshoppers revisited. See also the piece I wrote for Channel 4′s website. And do not neglect to watch the full interview with Mr Robert Halver, Baader Bank’s Chief economist. It sheds plenty of light on what [...]
Austerity and Growth
Or, actually, shrinkage. Watching Europe sink into recession – and Greece plunge into the abyss – I found myself wondering what it would take to convince the chattering classes that austerity in the face of an already depressed economy is a terrible idea. After all, all it took was the predictable and predicted failure of [...]
Greece: There will be Blood
The almost nightly dose of television horror about Greece is hard to watch, and must be nearly unbearable for Greeks themselves — but it is going to get even worse. Even if the current ‘bailout’ package is approved by the troika (EU/ECB/IMF), Greece is headed towards serious conflict and possibly even a military coup. First, [...]
Greece and the Eurozone
I was interviewed by BBC Newsnight yesterday about – you guessed it – the Eurozone crisis. Here is what I had to say. More on the tripple crisis of the Eurozone soon in written format.
Europe’s Crisis of Trust
A couple of weeks ago I stumbled upon an article on “Cameron’s Munich” comparing the alliance between the English and the Czechs at the last European Council with the situation of Munich in 1938. This is just another example how ‘war rhetoric’ has returned into the public debate. I always thought that European integration was always about [...]
The Way ahead for Social Democracy
Dr Steward Wood, UK Shadow Minister without Portfolio, discusses the economic crisis, the situation of European social democracy and explains his ideas for the future of social democracy. This talk was recorded at the event ‘Social Democracy and Europe’s Crisis’, Birkbeck, University of London on 16th February 2012.
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