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With Prime Minister Harper making the diplomatic rounds in Europe, media interest has heightened this week regarding the potential free trade agreement which his government is trying to negotiate with the European Union. Several deadlines to reach that deal have come and gone, but the Conservatives are still heavily committed to reaching a deal as [...]
Here is an important op ed from the Irish Times by a former senior IMF official, arguing that the most heavily indebted euro countries will have to default on some of their public debt. If they do not, public debt will continue to rise to even more unsustainable levels as unemployment and output losses soar.
This week’s edition of Embassy newspaper contained a very interesting briefing insert on the Canada-EU CETA talks. Below is a commentary from me critiquing the ubiquitous but unbelievable claim that free-trade with Europe would boost Canada’s GDP by $12 billion, create 80,000 jobs, and life incomes by $1000 per family.
“But the real point of me isn’t that I’m good looking. It’s that I’m clever. I’ve got a brain! I would rather be called a highly intelligent historian than a gorgeous pouting one” – Harvard historian Niall Ferguson, Sept. 2011. One of the predictable habits of the mainstream media is to seek out opinions on [...]
… in Portugal. Portugal’s Prime Minister announced on Friday that the government would raise workers’ social security contribution rates from 11% to 18% (about one month’s salary)… and decrease companies’ contribution rates from 23.5% to 18% in the same breath. The usual need for job creation is invoked as justificaion for the move… an interesting [...]
Here is an excellent commentary by Andrew Watt on the new ECB commitment to buy bonds without limit to reduce interest rates on the government debt of troubled members of the Euro zone. While an important and necessary step, this still means that deflationary austerity will continue, and that there will be no offsetting stimulus [...]
The Harper government decided to attack Thomas Mulcair on the issue of Canadian support for additional IMF resources to deal with the euro area crisis, implying that Canadian taxpayers should not be asked to “bail out” a rich area of the world. As recounted in Macleans here, on June 8, “Before QP yesterday, the Conservatives [...]
The Prime Minister’s speech at Davos was, I would bet, written by Stephen Harper himself. It bore the stamp of his long standing contempt for the European welfare state. He all but said that the Europeans had brought the crisis on themselves through trying to live beyond their fiscal means: As I look around the world, as [...]
An astute piece from Andy Watt. He thinks that we shall indeed soon see what markets are anticipating – the long deferred grand bargain, in which the ECB backstops euro bonds (thus averting a banking and sovereign debt crisis), in return for which euro countries agree to much enhanced surveillance of national fiscal policies. That [...]
The OECD’s new assessment of the macro-economic situation makes for pretty grim reading. And their forecast of very sluggish global growth (just 1.6% for the OECD area in 2012) is based on an increasingly incredible view that the Eurozone will “muddle through”and experience only a mild recession. They do not seem to have convinced even [...]
The Euro deal at least averted an immediate banking crisis and induced temporary market euphoria, but it is not going to provide a lasting solution to the euro sovereign debt crisis because it will block any lasting recovery for the euro economy. It is worth reading the text of the deal, which represents a major [...]
I don’t have much new to add to what is surely the key economic issue of the hour beyond pointing to useful commentary by Larry Elliott in the Guardian and Martin Wolf in the FT. I think Wolf is right that the key to resolving the crisis is to make the ECB the backstop for [...]
Canadian free trade negotiators are going all-out to get a deal with the EU on a new free trade agreement. The Harper government wants a deal badly for largely symbolic and ideological purposes, to show that the free trade agenda is back on track under this “stable majority government.” Many valid concerns have been raised [...]
The time since 2008 has been a crucial historical moment for progressive economists to pull back the green curtain that surrounds the operation of the for-profit banking system, and expose that system for what it is: a government-protected, government-subsidized license to print money. The problem is, as soon as you start saying things like that, people [...]
There is a cogent commentary from Martin Wolf in today’s FT. It is scary indeed that averting financial collapse demands structural changes in the euro area which seem to be politically impossible to achieve.
After watching Jack Layton’s state funeral, I noticed that Jean-Claude Trichet’s speech from Jackson Hole is online. The European Central Bank president does not seem to get it. Far from acknowledging that last month’s interest-rate hike was premature, he touts “price stability.” His main theme is that the economic divergence between Eurozone countries is comparable [...]
In an earlier post, Marc Lee mentioned in passing the German hyperinflation episode of the 1920s. It’s remarkable that this event still holds such sway over the popular imagination despite other more recent instances of hyperinflation. Certainly, the imagery is powerful: German citizens pushing wheelbarrows full of worthless paper money around for everyday purchases, banknotes [...]
This guest post is from PEF members Marc Lavoie and Mario Seccareccia, both of whom are full professors of economics at the University of Ottawa. The “Japanization” of the World Economy Over the last twenty years, the Japanese economy underwent a long period of economic stagnation that some economists have characterized as a protracted “balance-sheet [...]
Less than a month ago, the C. D. Howe Institute released Michael Parkin’s paper, “Overnight Moves: The Bank of Canada Should Start to Raise Interest Rates Now.” The next day, its Monetary Policy Council called on the Bank to increase the overnight interest rate. This call was terrible. The following week, Statistics Canada reported June’s [...]
For those of you out there who have not seen it, I recommend Social Europe Journal. There is a lot of good progressive economic commentary by leading European economists and policy types of a social democratic persuasion, as well as frequent commentary from Stiglitz, Reich and other US economists. Some good recent columns and blog [...]
CBC National News reconvened their “Bottom Line” economics panel (including yours truly) last night to discuss the twin debt crises (Europe and America) that are currently roiling financial markets. Here’s the link to the webcast for aficionados. In the last segment, Pater Mansbridge asked all the panelists how the debt problems should affect individual Canadians’ personal [...]
A month ago, Canada’s federal, provincial and territorial governments volunteered to be directly sued by investors under the Agreement on Internal Trade. This quiet announcement from Brudenell, Prince Edward Island, seems to have gone almost unnoticed. But it is a huge step toward imposing the Trade, Investment and Labour Mobility Agreement (TILMA) on all Canadian [...]
The CAW has just released a 20-minute video featuring none other than yours truly giving a short lecture about the economics of the proposed Canada-EU free trade agreement (a.k.a. CETA). This link takes you to the film, which can be downloaded for free and shown at information meetings or any other organizing events.
There is an excellent post by Scott Sinclair at the CCPA blog.
Earlier this month, I served as the discussant for a presentation by Engelbert Stockhammer, an economics professor from Kingston University in London. He was speaking at a conference organized by the workers’ representation to the International Labour Organization (ACTRAV). Stockhammer reviewed two antithetical strategies for economic growth. The pro-labour strategy aims to increase wages by [...]
The Progressive Economics Forum has the following line-up of sessions for this year’s Canadian Economics Association conference on June 3-5 at the University of Ottawa. Thanks very much to Nick Falvo for coordinating our conference activities and putting this schedule together. We are also hosting a summer school the day before and announcing our essay [...]
Boomers are getting blamed for an awful lot of fiscal problems these days. But blaming an aging population for healthcare costs spiraling out of control is misplaced. Missing opportunities to manage and contain costs is the real culprit. Take, for example, our spending on prescription drugs. Costs in that part of the healthcare system have [...]
Shortly before I left Canada, Canadian Business magazine contacted me for a story on productivity. It highlighted a presentation by Industry Canada economist Annette Ryan. I was struck by slide 40 (41 of 44 in the PDF): In an endogenous sunk cost model, opening free trade and intensifying competition leads to a divergence in innovation [...]
In the current battle against an all-out conflagration in Euroland, markets are twitchy about European (and other) banks in the event that the firefighters don’t get ahead of the blaze. If markets lose confidence in those large banks exposed to the problems in Europe (or anywhere else, for that matter), the next chapter in the [...]
I’d get popcorn to watch ECB vs. the speculators, if the whole sorry story weren’t so sickening. The European Central Bank is meeting today to figure out what the bleep to do about this mess in Europe (the press conference is happening as I write). In the lead-up to the ECB announcement, non-core bonds (like [...]