debating progressive politics in Europe and beyond
“Our biggest problems over the next ten years are not deficits,” the President told House Republicans Wednesday, according to those who attended the meeting. The President needs to deliver the same message to the public, loudly and clearly. The biggest problems we face are unemployment, stagnant wages, slow growth, and widening inequality — not deficits. The major [...]
The discussion about the fiscal cliff in the US and its potential implications for the US domestically and the wider global economy is still going on. And again Paul Krugman took the stage to explain why trying to cut the deficit too fast now, launching what he calls an austerity bomb, is completely counterproductive. Some [...]
This month the eurozone returned to recession, three years after it emerged from the deep recession of 2008-09. Paul De Grauwe argues that the current situation has been produced by policy failures at the beginning of the crisis. The best initial policy would have been for the eurozone’s creditor countries to increase spending, while the struggling periphery [...]
I wish President Obama and the Democrats would explain to the nation that the federal budget deficit isn’t the nation’s major economic problem and deficit reduction shouldn’t be our major goal. Our problem is lack of good jobs and sufficient growth, and our goal must be to revive both. Deficit reduction leads us in the [...]
Following the financial crisis of 2007, Eurozone countries have been separated into two large blocks dependent on their capacity to honor their domestic public finance constraints. The predominant view, and that of the EU institutions, is built upon a questionable causation, national fragility and profligacy. Hence, reestablishing credibility and the survival of the common currency [...]
The rating agencies are at it again. Moody’s Investors Services says it’s likely to downgrade U.S. government bonds if Congress and the White House don’t reach a budget deal before we go over the so-called “fiscal cliff” on January 2, when $1.2 trillion in spending cuts and tax increases automatically go into effect. Apparently the [...]
Despite the fact that many European economies are facing an austerity-induced recession, the ‘Austerians’ are already back on the attack. When travelling this week to Riga, Christine Lagarde, head of the IMF, rediscovered that Latvia, back in 2009, had been one of the Troika’s first guinea pigs in Europe to test out the policy of [...]
It may have been established primarily as a political union, but especially in the new member states the EU is increasingly failing to convey the notion that it is a value-based political community as well, and not only a business club. An (understandably) materialistic mentality in the new member states may be partly to blame [...]
Fifteen months ago I reported on what was then a affliction primarily hitting Anglo-Saxon politicians, Chronic Deficit Disorder (“neurotic fear of red ink”). Since then the malady has spread through Europe and entire populations. Throughout the developed world public sector deficits and debt are not the major problem, and in all but a few not [...]
The World Economic Forum 2012 is held again in Davos this week. It is the ‘Glastonbury of Globalisation‘ as Larry Elliott of The Guardian aptly put it; but the preparation for this year’s meeting was unusual as the so-called Global Issues Group, comprising members of the world’s multilateral and regional institutions, issued a strongly-worded warning message to [...]
In my last comment I demonstrated that the US public debt is not very large, and its annual servicing quite small. It occurred to me (and to several people who wrote to me in response to my comment), that it might be illuminating to carry out a similar exercise for the annual public deficit. You [...]
The National Institute of Social and Economic Research (NIESR) uses the term ‘depression’ to mean any period in which output remains below its previous peak. [1] The UK depression has already lasted three years and is likely to last five years or more; ie, longer than that of 1930s.[2] Not only must Osborne’s Plan A [...]
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