Posted by hkarner - 4. Januar 2017
Daniel Gros is Director of the Brussels-based Center for European Policy Studies. He has worked for the International Monetary Fund, and served as an economic adviser to the European Commission, the European Parliament, and the French prime minister and finance minister. He is the editor of Economie Internationale and International Finance.
JAN 4, 2017 Project Syndicate
BRUSSELS – Another year, another threat to the European Union’s survival. The good news is that the greatest disruption of 2016, Britain’s vote to exit the EU, appears manageable. The bad news is that both France and Italy face the prospect of a populist political takeover this year. Either outcome could well spell the end of the EU.
The EU has lately become a prime target for populists. The phenomenon first took hold in Greece, when the left-wing Syriza party came to power in January 2015. But Syriza was not trying to pull Greece out of the EU; rather, it wanted a better deal with the country’s creditors, who had imposed devastating austerity measures on Greek citizens.
Syriza’s approach largely reflected the will of the people. In a June 2015 referendum, voters overwhelmingly rejected a deal proposed by Greece’s creditors that would have meant even more austerity. Yet the government’s acceptance of a largely unchanged deal just a few days later received broad support. Greek voters understood that better terms were not worth losing eurozone membership. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, Brexit, Europe, France, Greece, Gros, Italy, Populism, Project Syndicate | Leave a Comment »
Posted by hkarner - 29. Dezember 2016
Deutsche Wirtschafts Nachrichten | Veröffentlicht: 29.12.16 19:49 Uhr
Der Investor George Soros sieht die EU am Ende. Die Schuld gibt er Angela Merkel.
George Soros liefert in einem Artikel für das Project Syndicate eine düstere Analyse über den Zustand der EU: Nach Ansicht des einflussreichen Investors ist die EU am Ende, weil Deutschland sich nur an seinen „engen eigenen Interessen“ orientiert habe. Anders als die USA nach dem Zweiten Weltkrieg hätten Deutschland den „anderen Nationen ein Austeritätsprogramm auferlegt“, statt ihnen mit nach der Lehman-Pleite im Jahr 2008 mit einem neuen Marshall-Plan zu helfen.
Der Zerfall sei durch Bundeskanzlerin Angela Merkel ausgelöst worden: „Als Lehman kollabierte hat sich Deutschland nicht reich genug gefühlt, um zusätzliche Verpflichtungen zu übernehmen. Als die europäischen Finanzminister erklärten, dass sie keine andere systemisch wichtige Finanzinstitution scheitern lassen würden, hat die deutsche Bundeskanzlerin Angela Merkel erklärt – indem sie die Wünsche ihrer Wähler richtig interpretierte -, dass jeder Mitgliedsstaat die Sorge um seine eigenen Institutionen selbst übernehmen müsse. Dies war der Beginn des Prozesses des Zerfalls.“ Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, DWN, Europe, Merkel, Soros | Leave a Comment »
Posted by hkarner - 14. Dezember 2016
Posted on December 12, 2016 by iMFdirect
By Maurice Obstfeld (pictured) and Poul M. Thomsen
Greece is once again in the headlines as discussions for the second review of its European Stability Mechanism (ESM) program are gaining pace. Unfortunately, the discussions have also spurred some misinformation about the role and the views of the IMF. Above all, the IMF is being criticized for demanding more fiscal austerity, in particular for making this a condition for urgently needed debt relief. This is not true, and clarifications are in order.
The IMF is not demanding more austerity. On the contrary, when the Greek Government agreed with its European partners in the context of the ESM program to push the Greek economy to a primary fiscal surplus of 3.5 percent by 2018, we warned that this would generate a degree of austerity that could prevent the nascent recovery from taking hold. We projected that the measures in the ESM program will deliver a surplus of only 1.5 percent of GDP, and said this would be enough for us to support a program. We did not call for additional measures to achieve a higher surplus. But contrary to our advice, the Greek Government agreed with the European institutions to temporarily compress spending further if needed to ensure that the surplus would reach 3.5 percent of GDP. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, ESM, Finanzkrise, Greece, IMF, Obstfeld, Thomsen | Leave a Comment »
Posted by hkarner - 10. Dezember 2016
on December 8, 2016 RGE EconoMonitor
After the UK Brexit and the Trump triumph in the US, the rise of anti-establishment Italy is hardly a surprise. It is the effect of half a decade of failed austerity doctrines in Europe and decades of failed political consolidation in Italy – ever since the notorious Tangentopoli scandals.
While Italy’s constitutional referendum heralds a political earthquake that will eventually affect both France and Germany, the immediate result is more uncertainty in economy, political polarization and market volatility.
End of an era in Italy – and Europe
Only hours after Italians had casted their ballot in the referendum on constitutional reforms, Prime Minister Matteo Renzi announced his resignation after heavy defeat.
Renzi’s ‘Yes’ camp included most of his Democratic Party (DP) and centrist allies, and the tacit support of moderate voters, including some from Silvio Berlusconi’s Forward Italy (FI). In turn, the opposition lineup featured Beppe Grillo’s Five Star Movement (M5S), the regional Northern League (NL) led by Matteo Salvini in alliance with the far-right Brothers of italy’s (Fdl) and Berlusconi’s Forward Italy (FI), a significant minority of PD allies, a number of small leftist groups,
According to projections, almost 60% of voters rejected constitutional changes. “My government ends here,” said Renzi from Palazzo Chigi. Moments later, he acknowledged that his pledge to resign if defeated at the polls had been a mistake. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, Deflation, Endgame, Italy, M5S, Referendum, Renzi, RGE Monitor, Steinbock | Leave a Comment »
Posted by hkarner - 7. Dezember 2016
Deutsche Wirtschafts Nachrichten | Veröffentlicht: 06.12.16 03:30 Uhr
Die Euro-Gruppe erwägt einen vorsichtigen Abschied von der Austeritäts-Politik – und setzt Deutschland sanft unter Druck.
Die Euro-Finanzminister haben sich der Aufforderung der EU-Kommission nur teilweise angeschlossen, dass Staaten wie Deutschland eine lockerere Haushaltspolitik zur Ankurbelung der Wirtschaft einschlagen sollten. In einer am Montagnachmittag veröffentlichten Erklärung der Eurogruppe hieß es, dass Deutschland, Luxemburg und die Niederlande ihre gute Haushaltslage nutzen „könnten“, um die Binnennachfrage und Wachstumsmöglichkeiten zu stärken.
Dies hänge ab von den besonderen Umständen des Landes, während zugleich die mittelfristigen Ziele sowie die Vorrechte der jeweiligen Regierung und die nationalen Regeln respektiert werden müssten.
Die EU-Kommission hatte Mitte November angeregt, dass im kommenden Jahr in der Euro-Zone insgesamt 0,5 Prozent der Wirtschaftsleistung mehr investiert werden könnten. Die Brüsseler Behörde erwähnte Deutschland dabei zwar zunächst nicht ausdrücklich, sie zog damit aber trotzdem heftige Kritik durch Bundesfinanzminister Wolfgang Schäuble auf sich, der ihr Kompetenzüberschreitung vorwarf. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, DWN, ecofin, Euro | Leave a Comment »
Posted by hkarner - 26. November 2016
Michael Hudson: Donald Trump Wants to Make the 1% Even Richer,” The Real News Network, November 18, 2016.
Economist Michael Hudson explains how economic terms like capital gains are deployed to mislead the public about who is benefiting from economic policy and where wealth is going.
SHARMINI PERIES, TRNN: Welcome back to the Real News Network. I’m Sharmini Peries coming to you from Baltimore.
Today I’m being joined in our Baltimore studio by economist Michael Hudson. Michael has a new book out January 20 – J is for Junk Economics: A Survivor’s Guide to Economic Vocabulary in an Age of Deception. Michael is a distinguished Research Professor of Economics at the University of Missouri, Kansas City. Thanks so much for joining us Michael.
MICHAEL HUDSON: Good to be here in your Baltimore studio.
PERIES: Thank you. So Michael, in the first segment we spoke more generally in terms of how people are misled through our policy makers in Washington in particular. But give us some specific examples of some of the terms used to mislead us. Den Rest des Beitrags lesen »
Posted in Artikel, Audios/Videos | Verschlagwortet mit: austerity, Debt, Hudson, Trump, USA | Leave a Comment »
Posted by hkarner - 29. Oktober 2016
Source: The Economist
The gap between poor and rich regions in Europe is widening
Austerity is partly to blame
THE beautiful but rubbish-strewn streets of Catania, Sicily’s second-biggest city, are a world away from swanky Trento, in the country’s richer north. About a quarter of Sicilians are “severely materially deprived”—meaning that they cannot afford things like a car, or to heat their home sufficiently—compared with just 5% in Trento. Italy is not unique. In many places, the divide within countries appears to be getting worse.
According to an analysis by The Economist, the gap between richer and poorer regions of euro-zone countries has increased since the financial crisis. Our measure of regional inequality looks at the average income per head of a country’s poorest region, expressed as a percentage of the income of that country’s richest part. The weighted average for 12 countries shows that regional inequality was declining in the years leading up to the financial crisis of 2007-08, but has increased since then (see chart).
The poorest area in Slovakia, the euro zone’s most geographically unequal economy, now has an income per person of just 28% of the richest, a slight fall from before the crisis. In Calabria, Italy’s poorest region, income per person as a share of the country’s best-off part, the province of Bolzano, was 45% in 2007 but is only 40% now. Elsewhere poor regions of the euro zone have seen income falling in both relative and absolute terms.
An exception is Germany: in its once-communist east, excluding Berlin, GDP per person reached 67% of that in former West Germany last year. (Most of the catch-up took place in the early 1990s, but continues more slowly.) Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, Economist, Euro, Inequality | Leave a Comment »
Posted by hkarner - 29. Oktober 2016
Source: The Economist
The founders of the euro have fundamentally different ideas about how the single currency should be managed
The Euro and the Battle of Ideas. By Markus Brunnermeier, Harold James and Jean-Pierre Landau. Princeton University Press; 440 pages; $35 and £24.95.
THE euro crisis that first blew up in late 2009 has revealed deep flaws in the single currency’s design. Yet in part because it began with the bail-out of Greece, many politicians, especially German ones, think the main culprits were not these design flaws but fiscal profligacy and excessive public debt. That meant the only cure was fiscal austerity. In fact, that has often needlessly prolonged the pain. Later bail-outs of countries like Ireland and Spain showed that excessive private debt, property bubbles and over-exuberant banks can cause even bigger problems for financial stability.
That is one early conclusion of “The Euro and the Battle of Ideas”, by three academics from Germany, Britain and France. They describe thoroughly the watershed moments of the crisis, how power shifted to national governments (especially in Berlin) and the roles played by the IMF and the European Central Bank (ECB). They blame euro-zone governments for failing to sort out troubled banks more quickly, for not realising that current-account deficits matter when public debts are in effect denominated in a foreign currency, for not making the ECB into a lender of last resort and for not pushing through structural reforms in good times. Den Rest des Beitrags lesen »
Posted in Artikel, Books | Verschlagwortet mit: austerity, Brunnermeier, Debt, Economist, Euro, France, Germany, James, Landau | Leave a Comment »
Posted by hkarner - 9. Oktober 2016
Source: The New York Times
Philip Hammond, Britain’s chancellor of the Exchequer, said this week that the government would borrow more to finance new infrastructure projects.
LONDON — As Europe has grappled with the trauma of a devastating financial and economic crisis, policy makers have consistently relied on one approach to managing the damage — budget austerity.
Shrink government spending by trimming pensions and cutting social programs, the logic runs, and the markets will gain confidence in the tough-minded people in charge. Confident markets make for happy markets. Money will pour in, and good times will roll.
Even as prosperity has remained painfully elusive across much of Europe, leaders have time and again renewed their faith in the virtues of this harsh medicine.
Until now. Europe is re-examining the merits of austerity. Some policy makers are flashing tentative signs that they may be prepared to slacken their grip on public coffers to spur growth and improve the lot of ordinary people suffering joblessness and diminished wealth. In the clearest sign of this shift, the heavily indebted Italy is increasingly inclined to challenge Germany — the guardian of austerity — to loosen European purse strings. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, Deflation, Europe, Inflation, Italy, NYT, UK | Leave a Comment »
Posted by hkarner - 27. September 2016
Paola Subacchi is Research Director of International Economics at Chatham House and Professor of Economics at the University of Bologna. Her forthcoming book, The People’s Money: How China is Building an International Currency, will be published by Columbia University Press.
SEP 27, 2016, Project Syndicate
SIENA – Now that Italian Prime Minister Matteo Renzi’s credibility is weakening at home, he will need all the friends he can get to clear the hurdle of a constitutional referendum in December – and thereby avoid likely political disruption. Renzi will need the support not just of his own party, which is deeply divided over the referendum, but also of an Italian electorate that has grown disillusioned with politics in general.
The referendum has become a litmus test for Renzi and his government partly because of his ill-considered warning earlier this year that he would resign if the proposed reform of the Senate (the parliament’s upper house) were voted down. But Renzi’s bigger problem is that he is a mid-term, unelected prime minister who promised, in 2014, to bring change to a country that has heard it all before. Den Rest des Beitrags lesen »
Posted in Artikel | Verschlagwortet mit: austerity, Euro, Finanzkrise, Italy, Project Syndicate, Renzi, Subacchi, Unemployment | Leave a Comment »