At the last ECB Council meeting President Trichet announced – via the code word ‘strong vigilence’ – an interest rate hike at the next meeting. Use of the codeword does allow a get-out if unexpectedly bad data were to come in. Juergen (‘stark wie die Mark’) Stark’s confirmation in today’s Financial Times that interest rates [...]
Mutual Repentance? Trade Unions and Social Democracy in Greece
31/03/2011 by
As seen elsewhere in Europe, the Greek government’s recent employment legislation has not been well received, putting the traditional partnership between the social democratic PASOK party and trade unions in jeopardy. In the context of mutual disappointment, however, can a renewed social partnership revive the country’s flagging economy and hard-tested social cohesion? Party–union relations in [...]
Equality and the Good Society
31/03/2011 by
When we started the initiative for the Good Society – during what became the most severe economic crisis since the 1920ies – our starting point was: There is an alternative. We do have a choice. We do not have to go back to unbalanced growth that leads into crises. We do not have to accept [...]
With notably rare Exceptions
30/03/2011 by
Paul Krugman has some fun with Alan Greenspan who wrote in the Financial Times that free markets work well, with some notably rare exceptions – like 2008. He collects a few ficticious examples in a similar vein, the most obvious of which is: With notably rare exceptions, Japanese nuclear reactors have been secure from earthquakes. [...]
The deepening Libyan imbroglio
30/03/2011 by
While Cameron calls for more arms and, at the recent London conference, la Clinton has effectively recognised the opposition as a government, Prime Minister Recep Erdogan has signalled that Turkey is ready to act as a mediator in brokering an early ceasefire in Libya.[1] Erdogan is said to be in contact with both sides, and [...]
Struck by Mankiw’s Struck-ness
30/03/2011 by
I am struck by the fact that the prominent Harvard economist N. Gregory Mankiw, former Chief Economic Adviser under George W. Bush, is struck by the following graph (due to the equally prominent John Taylor). So, when unemployment is high (in the US) investment, as a share of output, is depressed. And when unemployment [...]
When The Revolution Comes To A Dictatorship Near You
30/03/2011 by
Sitting in the presidential palace of an Arab country must feel like being a domino awaiting one’s turn to fall. Apart from trying to convince the military to remain loyal, sticking needles into a Mark Zuckerberg voodoo doll and checking the liquid worth of one’s portfolio, there is just not much one can do. The [...]
A Brief Commentary on the Relationship between Equality and Justice
30/03/2011 by
No one disputes that equality and justice belong together. Having said that, everyone is clear that they are not the same. Since Aristotle established justice as proportional equality there have been countless attempts to refine the relationship between the two. For the purposes of discussion I shall examine two current issues: First, How much inequality [...]
The IMF as a Global Lender of last Resort
29/03/2011 by
High volumes of currency reserves, which are currently invested in debt obligations denominated in Dollars, are looking for more secure investment opportunities. China and Russia, e.g., are requesting the IMF to emit such alternative “global currency bonds”, denominated in the IMF´s accounting unit SDR-“Special Drawing Right”. Dominique Strauss-Kahn currently supports this idea, suggesting that the [...]
Unemployment: Too much Regulation or Lack of Demand?
29/03/2011 by
On the day after the presentation of the governing Coalition’s budget in the United Kingdom (24 March), an “expert” form the Adam Smith Foundation was quoted in The Guardian asserting that if every small business were to hire only one new employee the UK would have no one without a job. He went on to [...]
Equality Used To Be Hip – It Needs To Be Again
29/03/2011 by
Perhaps the greatest tragedy of this historical period is that in spite of an amazing spate of social progress in many areas, that we seem to be backtracking in the crucial area of equality. It would have been both difficult and disappointing to anticipate in the 70s and 80s that a few decades later we [...]
The euro plus pact – a plus but not a solution
28/03/2011 by
It is often the case with policy and analytical documents produced by international bodies that the most important things are to be found in the annexes. In the specific case of the conclusions of the European Council of 23/24 March 2011, there are two long annexes. And you can pretty much dispense with the rest. [...]
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