Interview with Costas Lapavitsas: Strategies for the renaissance of the left in Europe — Radical Political Economy

Costas Lapavitsas, a Professor of economics at SOAS, and briefly a Greek MP in the Syriza government, discusses the causes and evolution of the eurozone crisis, and potential strategies for the left in Europe. While I am sympathetic to his explanation of the crisis, his solution, especially for Greece, are for a new leftist nationalism in opposition to the EU. Perhaps in the absence of EU and eurozone reform this would be desirable, but it remains controversial.

The interview is at the link below, via the Radical Political Economy website.

The following interview, conducted by Darko Vujica was originally published by prometej.ba on June 10th 2017.

via Interview with Costas Lapavitsas: Strategies for the renaissance of the left in Europe — Radical Political Economy

Germany’s anti-Keynesianism has brought Europe to its knees

eurozoneThis paper by Jorg Bibow has a useful take on how an ideology of anti-Keynesianism among German policymakers and its economic outcomes as a popular mythology result from a misreading of economic history. This faulty economic analysis has arguably played a major role in the eurozone crisis, and recent improvements in the eurozone economy are at the expense of the rest of the world. This is a form of ‘beggar-thy-neighbour’ policy, as a weak euro is stimulating demand for eurozone exports from its external trading partners, while domestic demand in the region remains weak. The eurozone economy is therefore improving by making the zone as a whole more like Germany in recent history, which has ‘succeeded’ via a dependence on export-led growth. Continue reading

Germany’s budget surplus: how do they do it?

1024px-Der_Deutsche_Bundestag_Plenarsaal-Gebäude_Reichstagsgebäude_Platz_der_Republik_Berlin_-_Foto_2009_Wolfgang_Pehlemann_Steinberg_DSCN9832

The German Bundestag. Change is needed on all sides involved in the current crisis, not least in Germany.

The German government’s ‘record’ post-unification budget surplus of nearly 24bn euros was in the news this week. As a percentage of GDP it is a mere 0.8%, but compared to the UK’s deficit of just under 4%, they seem to be doing relatively well, at least in terms of the desire expressed by many politicians for governments to ‘live within their means’. And this surplus does not seem to have come at the expense of economic growth. The German economy grew by 1.9% in 2016, the fastest in the G7 group of the largest economies in the world.

So how is this possible? Quite simply, it is down to the competitiveness of German exporters, achieved at the expense of ordinary German workers over the last decade or so.

Firstly, the deregulation of the labour market put downward pressure on wages at the bottom of the scale, so that Germany now has record numbers of low-wage, insecure jobs. Continue reading

The euro disaster — Wynne Godley was spot on already back in 1992! — LARS P. SYLL

If there were an economic and monetary union, in which the power to act independently had actually been abolished, ‘co-ordinated’ reflation of the kind which is so urgently needed now could only be undertaken by a federal European government. Without such an institution, EMU would prevent effective action by individual countries and put nothing in […]

via The euro disaster — Wynne Godley was spot on already back in 1992! — LARS P. SYLL