debating progressive politics in Europe and beyond
Since 2008, the world has been witnessing a struggle between politics and financial markets. The objective of a number of policy-makers is to limit the power of the financial industry to avoid another rescue package. The objective of the financial industry is to protect itself from economic interference. The result of this uneven struggle seems [...]
The Eurozone crisis has been a battle over who will ultimately be liable for the billions worth of actual and potential losses on sovereign debt held by European financial institutions. With neither the issuance of collectively backed Eurobonds nor the use of the European Central Bank (ECB) as lender of last resort initially available as [...]
Al Jazeera International produced a good roundup of the current problems of the Eurozone. I gave my two pennies worth at the end of the report: With the eurozone recession set to get worse, world leaders (…) will have to face a number of challenges. For two years the debt crisis has loomed over Europe. Greece, [...]
It may be hard to imagine that Europe’s crisis could worsen, but it just has. European Union leaders failed at their summit two weeks ago to produce anything of substance. China and Brazil are clearly reluctant to come to the rescue by providing a large injection of foreign cash. And the recent G-20 summit in [...]
It is often claimed that imposing a haircut (i.e. a partial default) on holders of Greek bonds is fair, sets incentives correctly, and avoids moral hazard. Haircut fans on Right and Left use slightly different arguments, but the basic point is the same. If you invest money, you must accept the risk of losses. If [...]
The countries most affected by Europe’s sovereign debt woes and Europe’s most energy dependent countries are largely the same. Greece, Ireland, Portugal, Italy, and Spain all import more than two thirds of their energy requirements. The context is one where Europe depends more generally on a wide range of commodities imported from abroad. The last [...]
Sometimes a counter-intuitive statement is based on a clever insight. For example, the statement ‘fiscal austerity can lead to higher government deficit ratios’ sounds implausible, but (most) economists agree that, at least under certain conditions, it may well apply. The reason is that the austerity reduces output, and thus the denominator of the deficit ratio, [...]
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 [...]
The European powers that be continue to accumulate failures. A break-up of the euro area is increasingly on the table. This is clearly not a desirable outcome. Yanis Varoufakis has explained why forcing Greece out of the euro would lead to the unravelling of the euro zone, while Barry Eichengreen has argued that a break-up would [...]
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 [...]
The least one can say is that at least the EU Ministers meeting in Brussels on Thursday 21 July took decisions to avert immediate crisis as the Vox EU letter from 13 economists asked.[1] The package seems to have been somewhat grudgingly accepted by the markets. The aim of the exercise was only in part [...]
Everyone knows that Greece will default on its external debt. The only question concerns the best way to arrange it so that no one really understands that Greece is actually defaulting. On this topic, there is no shortage of expert plans – among them bond buy-backs, bond swaps, and the creation of Eurobonds, a European [...]
SocialEurope Journal: SEJ Article: A Breakthrough Opportunity for Global Health http://t.co/VYXi6Wag SocialEurope Journal: SEJ Article: When Neo-Liberals drop their Mask http://t.co/saAJbUZH SocialEurope Journal: SEJ Article: At least nine EU countries in recession: stimulus urgently needed http://t.co/oNN0v98l SocialEurope Journal: SEJ Article: European Monetary Union: Doomed to fail or just another Stepping Stone? http://t.co/pMuqDvkA SocialEurope Journal: SEJ Article: Creating Jobs in recession-hit Communities in Europe: Why Microcredit will not help http://t.co/zJb4XxJl SocialEurope Journal: SEJ Article: German State Elections send Merkel an Economic Message http://t.co/yVG4Xr5n SocialEurope Journal: SEJ Article: Two dangerous Myths about a 'Grexit' http://t.co/vOhdnVIp SocialEurope Journal: SEJ Article: Finding a Way out of the Crisis – Growth and Employment in Europe http://t.co/Q8JhRRSg 
All Content
Follow US on Social Media