In the wake of the formal invoking of Article 50 by Prime Minister Theresa May, no one knows with certainty the impact on the UK economy of leaving the European Union. Claims of imminent damage and possible disaster should be treated at best as informed speculation and at worst as more of the dysfunctional fear […]
Crisis Of Governance: EU Democratic Deficit
In the wake of the Brexit referendum and with the Greek government once more facing the possibility of a forced Grexit, the limitations of EU governance loom large. Rather than bidding Britain a sad and reluctant adieu, “wayward sister go in peace”, some EU leaders seem intent on making the separation as expensive and unpleasant […]
Euro Is The Problem, Not The Union
Year of Referendum Disasters In 2016 the European Union both as an organization and hope for a better and more peaceful future suffered at least two serious and possibly mortal blows: the British “in/out” referendum gave a direct hit, while the constitutional plebiscite five months later in Italy delivered a glancing blow that might yet […]
An EU Agenda For Reform Not Business As Usual
Boldly pursuing business-as-usual Hailed by one commentator as “bold”, the speech to the European Parliament by Commission president Jean-Claude Juncker would more accurately qualify as shifting deckchairs on the Titanic in anticipation of its rendezvous with an iceberg. The bold proposals in question were modest in number and more modest in content. The two would-be […]
Eurozone Stagnation: Wrong Diagnosis, Wrong Medicine, No Recovery
What the EC Doctors Said If a doctor misdiagnoses a patient’s malady and prescribes an inappropriate medicine, we would not expect recovery to good health. Should the doctor persist in the faulty diagnosis and prescribe further doses of the wrong medicine, the wise patient seeks a second opinion. As evidenced by the experience of Greece […]
Eurozone’s So-Called Recovery Masks A Dark Secret: Mercantilism
Broad opposition in Europe to the Trans-Atlantic Trade and Investment Partnership has prompted its supporters to summon the “protectionist” spectre. In response to the criticism of TTIP by US presidential candidates and progressive politicians in Europe they, according to media reports, are talking up the end of “free trade” that has allegedly brought so many […]
The Six-Pack: EU Mandate For Bad Economic Policy
History provides many examples of authoritarian rule achieved through formally democratic procedures. To these we should add the EU Treaty on Stability, Coordination and Governance (TSCG, also known as the “Six Pack”), adopted by 25 democratically elected EU governments (all but the Czech Republic and the United Kingdom). On an EU website we find the […]
Why We Need To Rewrite The Maastricht Rules
The 1992 Treaty of Maastricht that lay the basis for the euro committed signing governments to several economic targets. Subsequent treaties and protocols made these targets stricter. The targets suffer from serious technical mis-specification. The problems of the criteria have their basis in a fundamental flaw that must be recognized and corrected to prevent further economic […]
EU Stagnation Continues: Deja Vu All Over Again
With the returning regularity of a bad habit, the Financial Times reassures us that yet again German economic growth snatches the euro zone from the jaws of recession. Just a day later the same august source bemoaned “sluggish” growth in the euro zone. And a few days later the European Central Bank confirmed non-recovery with […]
The Eurozone: Deflationary Boom Or Deflationary Bust?
Several years ago the idea that fiscal austerity could induce growth, “expansionary austerity”, had a brief flowering before withering under the heat of ridicule. Recently it resurfaced under a different name, “deflationary boom”. If expansionary austerity was oxymoronic, deflationary boom is simply moronic. To deconstruct and disinfect deflationary boom we need an operational definition of […]
Euro Deflation And How To Interpret It
If you read Larry Summers in the Financial Times, you know that recent data confirm falling prices in the euro zone. Summers argues that the deflation indicates global stagnation, though we find disagreement on the appropriate interpretation. For some it is no more than the transitory effect of falling petroleum prices. The focus on petroleum […]
Economic Recovery? Why Eurozone Under-performance Continues
Prior to the release of growth statistics in the middle of August there was widespread expectation that a sustained eurozone recovery would at last be verified. However, the numbers showed a result familiar to long suffering commuters all over Europe – “we regret that this service is delayed”. This is far from the first such […]
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