In his latest Financial Times column Wolfgang Münchau concurs with much of what I have written here (on the Greek social economy’s deep coma) and here (on the reasons why investors are piling in) but goes on to suggest that Greece should seriously consider exiting the Eurozone. In today’s post I offer an evaluation of his argument. In brief, I argue that, while Münchau’s assessment of the situation on the ground is spot on, the use of the ‘nuclear option’ (i.e. threatening to exit the Eurozone) is neither desirable nor necessary as a means of forcing Europe to change its ways. Continue reading
Greece is about to issue 5 year bonds again. Berlin, Brussels, Frankfurt and Athens are celebrating Greece’s recovery. For my part, I think (and tell the BBC World Service) that this is a sad day for Greece and it is a sad day for Europe. Why do I refuse to be impressed and join in the celebrations? It is because the Greek state and the Greek banks remain deeply insolvent. And, their return to the money markets is a harbinger of the next terrible phase of Greece’s crisis, rather than a cause for celebration. Continue reading
Thomas Piketty has a new book out: Capital in the Twenty-First Century. It is an ambitious volume that sets out to explain the sources of inequality and social tensions in the context of his own anatomy of… Das Kapital. As this book is receiving a great deal of attention, a proper review is in order. Thankfully, James K. Galbraith has provided such a review, published in Dissent – a Quarterly of Politics and Culture. Click here for Dissent’s website or read on…
The Irish and the Greeks are, in many ways, very different people. And yet, caught up in the Euro Crisis, our fortunes have become too close for comfort. Recently, European authorities have devised a creative new method for damaging the people of Ireland and of Greece further. The new method involved imposed changes on the public financing of bank recapitalisations that shift even greater burdens on taxpayers and on the weaker members of our societies. This article examines the changes and answers the pertinent question: Why is Europe doing this?
- James Galbraith, Lloyd M. Bentsen Jr. Chair in Government/Business Relations and Professor of Government, University of Texas – Austin
- Yanis Varoufakis, Visiting Professor at the Lyndon B. Johnson School of Public Affairs, University of Texas – Austin, and
- Jeffrey Sommers, Senior Fellow, Institute of World Affairs
- Moderator: Doug Savage, Institute of World Affairs
Bengt-Ake Lundvall is a co-signatory of the petition by 74 of us in favour of an immediate restructuring of Portugal’s public debt. Here are his reasons for signing the petition. (And, for readers who missed them, here are the reasons I gave for signing the same petition.)
The Centre for Labour and Social Studies (CLASS) kindly invited me to draft a possible Manifesto for the European Left, in view of the May 2014 European Parliament election. Here is the final document I produced entitled THINK BIG, THINK BOLD: Why the European Left must aim for a radical, Pan-European, Green New Deal.
The ‘haves’ of the world are always convinced that they deserve their wealth. That their gargantuan income reflects their ingenuity, ‘human capital’, the risks they (or their parents) took, their work ethic, their acumen, their application, their good luck even. The economists (especially members of the so-called Chicago School. e.g. Gary Becker) aid and abet the self-serving beliefs of the powerful by arguing that arbitrary discrimination in the distribution of wealth and social roles cannot survive for long the pressures of competition (i.e. that, sooner or later, people will be rewarded in proportion to their contribution to society). Most of the rest of us suspect that this is plainly false. That the distribution of power and wealth can be, and usually is, highly arbitrary and independent of ‘marginal productivity’, ‘risk taking’ or, indeed, any personal characteristic of those who rise to the top. In this post I present a body of experimental work that argues the latter point: Arbitrary distributions of roles and wealth are not only sustainable in competitive environments but, indeed, they are unavoidable until and unless there are political interventions to keep them in check.
Jorge Rodrigues, of Portuguese daily Expresso, asked me to explain why it is that I signed the petition of 74 economists calling for an immediate debt restructuring of Portugal’s public debt, how this ‘call’ squares up with our Modest Proposal and what type of debt restructuring I had in mind. Click here for the interview as published in Expresso. My original answers in English follow… (See also this piece on lessons for Portugal from the Greek PSI – click here for the Portuguese published version) Continue reading
While Frankfurt-Berlin-Brussels are in full spin mode on Portugal, pretending that the fiscal consolidation program was successful and the country is about to exit its bailout (a little like exiting the frying pan to land in the fire itself), the bitter reality is that Portugal’s public debt is out of control, its labour market in shambles, its real economy moribund. Against the grain of Europe’s shameless propagandists, 70 of us have signed a petition calling for an immediate debt restructure that might give Portugal a chance to escape its debt-deflationary spiral. Click here for a pdf of our letter/petition as published in a Portuguese newspaper.
In June 2012, at a time when central banks had pushed interest rates to almost zero, Italy had to borrow at 8% to re-finance its gargantuan $3 trillion debt. Spain was in even direr straits. With national income falling by 2% annually, these interest rates meant that the national debt mountain was rising by 10% every year. In one word, insolvency! This was the spectre hanging over major European nations in the summer of 2012, guaranteeing that the Eurozone was finished. Today, Italy’s and Spain’s interest rates have fallen to a more manageable 3% to 4% and national income has stabilised. There is even fast money that flows into the crippled European banks, even into the dismembered Greek stock exchange, seeking bargain-basement prices for certain woefully depressed shares. These observations can easily be mistaken for signs of light at the end of the tunnel. But ‘mistaken’ is the operative word. Continue reading
Readers of this blog are familiar with Danae Stratou‘s photographic works (her photos adorn the header above). In this post I copy a story from CNN.COM about Desert Breath: one the largest and (in my eyes) most significant land art projects on the planet’s face. It is the creation of Danae Stratou, Alexandra Stratou and Stella Konstadinidis (the three members of D.A.ST. Art Team) who designed and created it in the Eastern Sahara Desert (Egypt) in 1997. Click here for the CNN.COM web-page or read on… Continue reading
Tony Benn’s passing saddened and concentrated my mind. His was the voice that resonated with (a much younger version of) me most powerfully immediately after I moved to England in 1978. I was attracted instantly to the combination of: his commitment to the progressive history and potential of British Parliamentarianism, his passionate anti-imperialist pacifism, his relentless socialist critique of capitalism, and his stupendous eloquence. But there was something beyond that: He stood opposite Mrs Margaret Thatcher as one of the few members of the opposition interested in, and capable of, conviction politics. In an age of increasing spin, Tony Benn was solid in his support of political causes independently of political expediency. He was a rock rather than a weathercock. Continue reading
Following my debate with Andreas Antonopoulos on ABC Late Night Live, graduate students of mine (at the University of Texas) were kind enough to piece together a related Q&A reflecting my views on BTC. Read on… Continue reading
In this lively debate, on ABC Radio National’s excellent Late Night Live (with Phillip Adams in the chair), we discuss what makes Bitcoin a fascinating technology, whether it is a genuine currency, its parallels with the Gold Standard and what I have called previously the dangerous fantasy of apolitical money.
Jorge Rodrigues, of Portuguese daily Expresso, wrote to me with a question: “What lessons can countries like Portugal learn from the Greek PSI of 2012, now that their post-bailout debts have also become unsustainable?” My answers were published in Expresso on 17th March 2014. My original answers in English follow: Continue reading