European crisis has not been solved - and the solutions are not fun.
Previously on MoreLiver’s:
War in Mali, Cameron’s Europe speech, and has the ECB done enough
to save the euro?
The west's crisis is one of democracy as much
as finance – The
Guardian
Slavoj
Žižek: The spirit of dictators like Ceausescu is finding new life in the
response of the European elite to pressures in the eurozone
Blogs review: A bird’s eye view on Bruegel’s
research in the crisis – bruegel
In the
spirit of the Stability and Growth Pact, we decided to grant an exception the
rules governing our blogs review and survey some of our very own publications
for those of you (especially in the blogosphere since we were pretty late at
joining the dance) who may have missed these.
The eurozone crisis may need to get worse
before it can be solved – europp
/ LSE
The
eurozone is facing a complex competitiveness, fiscal, banking and political
crisis. Miguel Otero-Iglesias writes that the fundamental problem is that the
countries of the eurozone are unwilling to hand over sovereignty to an EU
centre. He argues that the significant political obstacles to reform may mean that
the crisis will have to get worse in Spain, Italy, and even Germany before European leaders will take
the bold steps needed to ensure the survival of the euro.
As Europe’s fiscal union marches on, it is time for the centre-left to debate
what it can do to make the eurozone more progressive – europp
/ LSE
While the
EU edges ever closer to fiscal federalism, it still lacks a federal budget,
which would be able to assist areas of the eurozone that are in economic
difficulty. Dan Corry argues that in the absence of a eurozone-wide federal
budget, Europe’s centre left must begin to
consider and debate measures that would help struggling regions, such as more
progressive taxes and an EU-wide unemployment benefit scheme.
Brexit, Voice, and Loyalty – Project
Syndicate
Albert
Hirschman was a great economist with a gift for producing striking insights
that transformed our view of a whole range of particular problems. One of his
most far-ranging insights was his framework of “exit, voice, and loyalty,”
which helps to explain the dilemma of today's EU.
Europe’s Debt Crisis Endgames—Stealth Solutions – EconoMonitor
Satyajit Das: The probable endgame of Europe’s debt
crisis is already known – de facto mutualisation of European debt and greater
integration. But the precise events leading up to it are unknown. The story is
being told backward.
(audio) Eurozone Deadlock – Finding a Path Out of
the Crisis – LSE
It is still
possible to find a way out of the Eurozone crisis if policy-makers address two
problems: dealing with the legacy costs of the initially flawed design of the
Eurozone, and fixing the design itself.
Cyprus’s now-certain default – Felix
Salmon / Reuters
Could a
country smaller than Sicily reignite the euro crisis? In June
2012 the Cypriot government asked for a bail-out after the two largest banks,
stacked with Greek bonds, fell victim to the 2011 write-down of Greek debt.
Seven months on, time is running out.
The
outgoing treasury secretary on his financial crisis regrets, putting policy
before politics, and whether Washington will ever be able to strike a grand
bargain.
The
political impasse facing the U.S. arises from one simple reality:
Americans want an increasing government contribution to health care, but don't
want to pay for it.
Predicting the Next Recession – Calculated
Risk
So right
now I expect further growth for the next few years (all the austerity in 2013
concerns me, especially over the next couple of quarters as people adjust to
higher payroll taxes, but I think we will avoid contraction).
The Bank of
Japan tests the limits of Shinzo Abe’s economic power. Less than a month after
taking office as Japan’s new prime minister, Shinzo Abe
has been lionised by some prominent Keynesians.
Japan's recent territorial tussles with China and South Korea and the election of the conservative
Shinzo Abe as prime minister have the world worrying that the country is taking
a hawkish turn. In practice, however, Tokyo's new government will tow a
moderate line and concentrate on strengthening its diplomatic ties.