The European policy of Chancellor Angela Merkel is coming increasingly under pressure. Not only European Commission President Manuel Barroso, but also Enrico Letta, recently asked by Italian President Giorgio Napolitano to form the new governnnent, have criticized her austerity policies, which have been dominant in Europe and are leading to disaster. Europe’s leaders have long been at [...]
Posts under ‘Macroeconomics’
Ed needs to work out where disunity comes from, and let the party decide its direction
Apr 25th, 2013 by Jon Lansman.It is true that “Len McCluskey does not speak for the Labour Party” as Ed Miliband’s spokesperson put it last night. Nor (anymore) do Tony Blair, Peter Mandelson, Alan Milburn, David Blunkett, John Reid, or Tessa Jowell, who have between them been subjecting Ed to persistent attacks, without regard to the impending local elections. But the unnamed shadow [...]
The theory on which austerity is built is now shown to be false
Apr 24th, 2013 by Michael Meacher.Two years ago the Harvard economists Carmen Reinhart and Kenneth Rogoff published their best-selling book This Time is Different which purported to show that one natioanl debt exceeds 90% of GDP, economic debt declines rapidly. It was seized on by Right-wing governments, media and academic pundits generally to justify a policy of extreme cutbacks in [...]
Thatcher’s legacy on debt: cut spending, destroy earning capacity
Apr 20th, 2013 by Michael Meacher.Mrs. Thatcher was once asked: What is Thatcherism? She replied “living within our means”. So what is her legacy in this regard? In the two decades from the mid 1980s private household debt rose to the level of total national income (£1.5 trillion), financial debt following her deregulation of the banks rose to 5 times [...]
Italian centre-left pays price of facing right not left on austerity
Apr 19th, 2013 by Tom Gill.Things are not going at all well for Italy’s centre-left leader Pier Luigi Bersani. Once clear favourite to replace Mario Monti as prime minister, he’s now fighting for his political survival. Parliamentary elections in February denied his alliance enough votes to govern alone and the upstart Five Star Movement led by comedian-blogger Beppe Grillo rejected offers [...]
What causes inequality?
Apr 5th, 2013 by Bryan Gould.The widening gap between rich and poor that has disfigured and weakened our society over recent decades is widely deplored, but there is surprisingly little understanding of how that growing inequality has been brought about. For most people, it simply reflects the natural order; the rich have each individually taken their chance, as anyone would, to [...]
Fixing the economic transmission system: co-ordinating monetary and fiscal policy
Mar 19th, 2013 by Ann Pettifor.“The economic [monetary] transmission system works to create the finance, which is then spent [fiscal] in productive investment in infrastructure. This sound investment in turn generates economic activity, i.e.employment. Employment in turn generates wages, incomes and profits – and these in turn generate tax revenues with which to reduce the deficit and pay down the government’s debt.” Thanks [...]
Austerity isn’t supposed to help the economy – but to protect the rich
Mar 11th, 2013 by Mike Hedges.With Osborne’s fourth budget approaching, the Tory austerity programme is clearly in trouble. The news that a majority of people now think the cuts are not working is bad news for the Chancellor. This follows the stinging rebuke delivered to David Cameron on Friday by the independent Office for Budget Responsibility (OBR) which rebutted claims [...]
You’ve never had it so bad
Mar 4th, 2013 by Michael Meacher.The consequences of the government’s insane, counter-productive, self-defeating orgy of endless cutting are now beginning to be evaluated with some clarity for a decade hence. The Resolution Foundation, which specialises in income analysis, has calculated that on present plans families on low or average incomes will be no better off in 2017 than in 1997, [...]
The pound in your pocket is lowering your living standards
Mar 4th, 2013 by Michael Burke.The British pound has begun to fall once more on the international currency markets. It may be further helped on its way by the loss of the AAA credit rating. This will have important domestic economic consequences. The currency is also being talked down by a number of officials, effectively including both the current governor of [...]
