debating progressive politics in Europe and beyond
Yesterday Ben Bernanke added his voice to those who are worried about Europe’s debt crisis. But why exactly should America be so concerned? Yes, we export to Europe – but those exports aren’t going to dry up. And in any event, they’re tiny compared to the size of the U.S. economy. If you want the [...]
In the political discussions about the origins and causes of the current Eurozone debt crisis the rules of the Stability and Growth Pact often play a prominent role. Also yesterday, when the German Bundestag voted on the proposed Euro rescue fund, the Pact was regularly cited. Let me be clear: this discussion is misguided as the [...]
The latest economic data suggests that recession is returning to most advanced economies, with financial markets now reaching levels of stress unseen since the collapse of Lehman Brothers in 2008. The risks of an economic and financial crisis even worse than the previous one – now involving not just the private sector, but also near-insolvent [...]
Once again my head talking about the Eurozone crisis, this time on Al Jazeera English’s Inside Story programme:
In one sense Greece was finished the moment the Great Recession cut its growth rate (in the second quarter of 2009) from among the highest in Europe to almost zero. Given its high, and increasing, debt-to-GDP ratio, not to mention the preceding run on Dubai’s private-cum-sovereign debt, Greece’s stalled economy precipitated a run on Greek [...]
The world was expecting Eurobonds to come out of last week’s Franco-German summit; instead, the eurozone will get economic governance. According to German Chancellor Angela Merkel and French President Nicolas Sarkozy, the great leap forward to the creation of Eurobonds would perhaps be the culmination of that process, but for the moment small steps remain [...]
I wrote a brief column for the New York Times last week, which I thought is worth reposting here: The eurozone crisis is yet again coming to a head. Even though the reluctant readiness of the European Central Bank to buy Italian and Spanish bonds has eased the immediate pressure for the time being, there [...]
Investors are anticipating the unravelling of the 21 July 2011 “solution” and a breakdown of the interbank-market that would throw the economy into an “immediate recession” like the one experienced after the Lehman bankruptcy. This column argues that this will happen without quick and bold action. The EFSF can’t work as designed but if it [...]
Financial markets abhor uncertainty; that is why they are now in crisis mode. The governments of the eurozone have taken some significant steps in the right direction to resolve the euro crisis but, obviously, they did not go far enough to reassure the markets. At their meeting on July 21, the European authorities enacted a [...]
Europe is clearly in a serious crisis that requires courageous decisions of great magnitude to be taken. The SPD has concluded that the Federal Government must change its policies if it is to lead Europe out of the crisis. The party chairman, Sigmar Gabriel, and the chairman of the parliamentary group in the Bundestag, Frank [...]
Last week, the European heads of government added €109 billion to the existing €110 billion rescue plan for Greece. As Europe’s financial sector would have otherwise taken a huge hit, this column address the question: How did the financial sector manage to negotiate such a gigantic wealth transfer from the Eurozone taxpayer and the IMF [...]
European monetary union has always been haunted by a spectre. That spectre is the irresponsible member country with an uncompetitive economy and a large budget deficit, building up too much debt and having to be bailed out. This bogeyman had a strong hold on the imagination of policymakers from the start, especially in Germany. Hence [...]
All Content