Ideas spread fast, bad ideas spread faster. Over the last few months, the European Commission has tried to give new impulse towards achieving a ‘Social Triple A’ rating. At the beginning of March, Employment and Social Affairs Commissioner Marianne Thyssen launched a social package comprising an outline of the European Pillar of Social Rights and some ideas to facilitate labour mobility. Continue reading →
For as long as the euro’s architecture remains incomplete, Greeks get to decide whether to pay or not. It’s called sovereignty.
Greece has escalated the European debt crisis, hoping that austerity would be reduced and debt forgiven as we approach the brink. Indeed the downside risks of a Grexit far outweigh any imagined benefits: Creditors would lose all loaned taxpayer money, and reverse the direction of European integration for the first time, precipitating furthercalamities down the road. But for as long as creditors resist deeper integration of theeuro area, with 19 euro members retaining their economic sovereignty, the blackmailing will go on. Not following the rules is the very essence of economic sovereignty. Greececan free-ride while weighing the costs and benefits of following the rules or not.
The solution to this is not self-defeating austerity, and we hope European leaders willbe too risk-avers to risk Grexident. The answer must be a decisive deepening of the single currency to render the euro sustainable.
It really looks like we are not learning from our mistakes. This whole situation between Greece and its international creditors is becoming ridiculous.
Here, the two points that are striking to me:
We have learnt nothing from economics. How come that current negotiations keep on discussing and putting forward economic provisions that proved to be wrong? (and by wrong here I mean that had pro-cyclical effects, i.e. contributed to recession rather than to growth and prosperity)
We have learnt nothing from politics. How come that we haven’t realized yet how bad it is to continue with externally imposed measures on a country and its population? (and by bad here I mean that it reinforces, gives arguments and vigor to those extremist or Eurosceptic forces which are threatening European integration and are growing in several countries)
I will discuss these two points in more detail and then move on to see whether it is possible to find some points on which there is agreement and propose the establishment of a table on investment for Greece. Continue reading →
There is in Europe a widespread contempt in judging the ECB’s current monetary policy decisions, almost as if virtually any economist, analyst, student or politician could fare better than a panel of respected central bankers. Continue reading →
Investors are watching with bated breath for the outcome of this week’s two-day round of hearings at the Federal Constitutional Court of Germany. In a case brought before the Court by the academic founders of the new “Alternative for Germany” political party among others, and whose petition was signed by 35,000 Germans , the Court has to judge on the compatibility of the ECB’s Outright Monetary Program with the German Constitution.