debating progressive politics in Europe and beyond
As is customary at the start of a new year, imposing statistics and trend forecasts are being trumpeted worldwide. For example, in 2016, China is expected to replace the United States as the world’s largest economy. And, by 2040, India’s population will have reached 1.6 billion, surpassing China’s, which will have stagnated a decade earlier. [...]
France is at a crossroads. It has numerous valuable assets, but it cannot postpone long-overdue reforms, or else it will become increasingly irrelevant in a fiercely competitive global economy. This is the economic challenge that President François Hollande, Prime Minister Jean-Marc Ayrault, and all of us in the French government must confront. We face a [...]
Who can deny that Francois Hollande has a serious problem? Polls show his popularity has plummeted – that only just over one-third of the public still support him. In his press conference speech on 12 November he sought to convince a growingly sceptical public that he can turn France around, that “decline is not our [...]
It is fashionable to blame lack of competitiveness for having caused the Euro-crisis. Yet, competitiveness is difficult to measure. The most common indicator is relative unit labour costs (ULC), i.e. the cost of labour compensation, including taxes and social security, per unit of output. These costs are usually measured by an index that shows how [...]
Responding to a piece by Ryan Avent, the noted (and mysterious) German blogger Kantoos asks for help in coming up with ideas about how to reduce Germany’s current account surplus, apart from deregulating services. Let me help him (or her). Germany could go some way to reversing the labour market reforms and the political pressure [...]
Just when you thought the euro debate couldn’t get any more inane, in steps Martin Feldstein with his answer to the euro area crisis. For the euro area to become strong again, the euro must become weak, he opines. The problem, you see, is that countries like Italy, Spain and France have current account deficits [...]
Balanced budgets, wage restraint and more competitiveness for everybody – this is the result of the last European summit and the new definitive solution for the Eurozone crisis. Eurozone leaders (with the exception of David Cameron) have decided to follow the German way of doing business: since the euro’s introduction Germany has actually done everything [...]
Recent debate on support for Greece and other peripheral economies has tended to focus on the packages provided by other member States, which are easily portrayed in the media and by resentment-stoking politicians as a ‘transfer’ from (hard-working, deserving) taxpayers in one country to bail-out (lazy and undeserving, or at best unfortunate) taxpayers in another. [...]
A few weeks ago, and after twelve months of being trapped under the global negative spotlight, Greece managed to produce some impressive news on the economy front. I am not referring to the fiscal adjustment program, which has so far been ambitious and front loaded, cutting the deficit by 6% consequently proving our critics wrong. [...]
To paraphrase Denmark’s Prince Hamlet, ‘To enact austerity or not to enact austerity, that is the question.’ Unfortunately, dear Hamlet, that is a question without a sure answer. The truth is, none of the experts know what is the correct thing to do. Trichet, Bernanke, Geithner, Schäuble, Krugman, Stiglitz, Wolf, Münchau, Soros, all of them [...]
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