On the eve of the 2019 annual meetings of the World Bank and IMF, we are once again alerted to a rise in the debt burdens of low-income countries. Last year the total external debt of both low- and middle-income countries climbed 5.3 percent to $7.8 trillion, while net debt flows (gross disbursements minus principal payments) from external creditors tumbled 28 percent to $529 billion, according to the World Bank’s International Debt Statistics. In other words debt burdens worsened, while foreign creditors effectively switched the lending tap down to a trickle. The sovereign debt crises of the poorest countries has shaped all my work on the international financial architecture. or system. An important part of my life was dedicated to a campaign to write off the unpayableRead More »
Articles by Ann Pettifor
The following hastily written piece appeared in Left Foot Forward on 25th September, 2019.The Nobel Memorial Prize in Economics will be 50 years old next month. One thing unites all its winners, bar one: they have all been male.This is not just an affront to equality. In overlooking brilliant female economists, the Swedish Central Bank’s Nobel has neglected economic theory which could have helped prevent the turmoil of regular financial shocks and political trauma.The outstanding female economists passed over by the Nobel Foundation have often understood the social nature of money and credit as a social construct more profoundly than male economists crowding the world stage. And yet, they have rarely been recognised, never mind celebrated. That must change.TheRead More »
My review of John Maynard Keynes’s The Economic Consequences of the Peace Macmillan (2019) appeared in Nature – the International Journal of Science – on 23 September, 2019.“Ann Pettifor finds astonishing contemporary resonance in John Maynard Keynes’s critique of globalization and inequity.”The Economic Consequences of the Peace John Maynard Keynes Macmillan (2019)In December 1919, John Maynard Keynes published a blistering attack on the Treaty of Versailles, signed in June that year. The treaty’s terms helped to end the First World War. Keynes’s The Economic Consequences of the Peace revealed how they would also pave the way to the Second.Keynes, then at the start of his career in economics, had attended the Paris Peace Conference, where the treaty was drafted, asRead More »
The following article and interview with PRIME’s director written by Hettie O’Brien, appeared in the New Statesman on 24th September, 2019. Please note the error at the end of the piece: Since the Paris Climate Agreement three years ago, J.P. Morgan Chase have reportedly lent $196 billion, not $1.96 billion to fossil fuel industries, oil, coal and gas. The figure is drawn from the Rainforest Action Network’s 2018 Report, Banking on Climate Change.Eleven years ago, a group of economists and green thinkers devised a radical plan to transform the economy and protect the environment. Today, their ideas have been embraced by Labour and US Democrats.Since a group of Labour activists began agitating for the party leadership to adopt a Green New Deal in March this year, theRead More »
This is an excerpt from a Green New Deal Report published today, 20th September, 2019 – the day children and their supporters around the world demanded urgent action on the climate emergency. The Green New Deal Report is co-authored by PRIME’s director, Ann Pettifor, and accompanies the publication of Bill tabled in parliament by Caroline Lucas MP (Green Party) and Clive Lewis MP (Labour Party). Momentum is growing worldwide for a comprehensive Green New Deal that will transform our economy, society, and almost every aspect of life in Britain: from the way we produce and consume energy, grow the food we eat, travel, work, and cool and heat our homes.An economic system that has driven us to disaster. For more than fifty years the global economy has endured frequent andRead More »
The director of PRIME is a co-author of this new report by the Green New Deal group UK, published on the day a wave of schoolstrikes swept the world – demanding action to reverse the potentially catastrophic impacts of earth systems collapse . It accompanies the publication of the Decarbonisation and Economic Strategy Bill, a Bill first tabled by Caroline Lucas MP (Green Party) and Clive Lewis MP (Labour Party) in March 2019, now published in full. It is designed to implement a Green New Deal for the UK.Fundamentally, the Bill lays the foundations for the changes to the way that government manages the economy needed to make transformation possible.The Bill establishes a Green New Deal Commission, which will draw on the expertise across society and from every corner of theRead More »
On the day that my book The Case for the Green New Deal is launched, the Guardian published the article below. In September 2007, as credit was “crunched” and the financial crisis began to unfold, a group of economists and environmentalists, including the future Green party MP Caroline Lucas, met regularly in my small London flat. Supping on comfort food and wine, we argued furiously while drafting a plan we hoped would transform the economy and protect the ecosystem. We called it the Green New Deal. Little did we know that the ideas we seeded then would be adopted by a shooting star of the Democratic party, Alexandria Ocasio-Cortez, as part of her bid for a New York congressional seat in 2018.Fast forward to 2019 and the Green New Deal is now at the centre of theRead More »
On 5 September, 2019 in a Financial Times video, Jim Pickard, political editor of the Financial Times, looks at how, behind divisions over Brexit and anti-semitism, there is a radical agenda led by shadow Chancellor, John McDonnell. Jim interviews a range of advisers, including Ann Pettifor, Director of PRIME. The video can be viewed here.Read More »
On 3rd September, 2019 the Financial Times published a visual survey of figures around Jeremy Corbyn, Opposition leader and head of the British Labour Party. The story can be found here: Ann Pettifor, Director of PRIME features in it. There is one minor error: Pettifor did not ‘step away’ from advising the Corbyn team after the European Referendum of 2016. The other economists on the advisory board stepped away…. Pettifor was the only one to remain. The following are extracts from the story. “Jeremy Corbyn is an atypical leader of the Labour party; one with almost total factional control of Britain’s opposition. To achieve this, the 70-year-old is surrounded by a tight cabal of influencers who shape both his politics and policies and are seen by many as the real peopleRead More »
2018 was the 150th anniversary of the TUC, and the 70th anniversary of the Trade Union Advisory Committee to the OECD. As part of the celebration of these achievements, the TUC’s Economics and Social Affairs department organised an event “Lessons from the Great Financial Crisis” – on 12th November, 2018 – the day after Armistice day, and 100 years after the ending of the First World War. Several speakers, including ex-Prime Minister Gordon Brown, were invited to address the gathering of trades unionists, thought leaders and economists. Below is a transcription of Ann Pettifor’s contribution. IntroductionFew people will have heard of Thomas Lamont. That is regrettable, as he bears considerable responsibility for the failure of Europe to recover after the First World War.Read More »
Fixing the roof whle the sun shines? (Photo: Jeremy Smith)
This post was written as introduction to the very recently published book “Discourse Analysis and Austerity: Critical Studies from Economics and Linguistics”, edited by Kate Power, Tanweer Ali and Eva Lebdušková. Published by Routledge, it is available from here.As a non-academic of lifelong duration, I am honoured to be invited to provide an introduction to this ground-breaking (agricultural metaphor!) set of essays. I have been a long-time admirer of George Lakoff and his colleagues, and try to find Metaphors We Can Live By. But in theRead More »
The Brexit referendum provided conclusive evidence that economics is inherently political. There was nothing scientific about any of the campaign promises or economic forecasts. Instead, in the run-up to the referendum Brexiters stressed the importance of the domestic labour market and blamed immigrants for the post-crisis slump. They ignored the costs of exiting a huge EU market in goods and services, and of cutting off the long supply chains of British firms. Remainers focused on Britain’s role in the globalised economy. “Britain is a global nation with a global role and a global reach” opined the Prime Minister. Voters scratched their heads over what it meant to be a “global nation.” Many preferred the Brexiters’ commitment to the national flag or “sovereignty’”TheRead More »
Article for Prospect Magazine 21 November, 2018. Ann Pettifor, Council Member, Progressive Economy Forum.
According to Heisenberg’s uncertainty principle there are limits to the precision with which we can be certain about the properties of a particle.
….the position and the velocity of an object cannot both be measured exactly, at the same time, even in theory. The very concepts of exact position and exact velocity together, in fact, have no meaning in nature.
As in physics so in economics. There are limits to the precision with which we can judge the impact of the interminable drama that is Waiting for Brexit. The precise ‘object’ of Brexit is not clear, let alone its impact, or speed of impact. We know it will have an impact, but this can only be broadly estimated.
Let’s go to the
This is an extract from a chapter in Economics For the Many (Verso, 2018) edited by Rt. Hon. John McDonnell MP. The chapter was written in August, 2017. If we are to secure a sustainable, stable and liveable future for the people of Britain, then implementation of the Green New Deal will be vital. Not just for the sake of the ecosystem, but also for the sake of rebuilding a stable, sustainable economy. The era of procrastination, of half measures, of soothing and baffling expedients, of delays, is coming to its close. In its place, we are entering a period of consequences. Winston Churchill, 12 November 1936 Introduction: the flawed economic theory and language of endless ‘growth’. Within nature, plants, animals and humans are seeded, or born. They mature. And then theyRead More »
12 November, 2018
This year is the 150th anniversary of the TUC, and the 70th anniversary of the Trade Union Advisory Committee to the OECD. As part of the celebration of these achievements, the TUC’s Economics and Social Affairs department organised an event “Lessons from the Great Financial Crisis” – on 12th November, 2018 – the day after Armistice day, and 100 years after the ending of the First World War. Several speakers, including ex-Prime Minister Gordon Brown, were invited to address the gathering of trades unionists, thought leaders and economists. Below is a transcription of Ann Pettifor’s contribution.
Few people will have heard of Thomas Lamont. That is regrettable, as he bears considerable responsibility for the failure of Europe to recover after the First World
Budget Special: To tackle austerity, Britain needs (at least) a £50 billion increase in public spendingOctober 26, 2018
The old View of the Treasury… Photo with acknowledgment to Social.shorthand.com “The Treasury building: a surprising history”
This article was first published on the Progressive Economy Forum websiteAusterity has severely damaged Britain’s physical and social infrastructure. Coupled with a fall in real wages, austerity has shrunk Britain’s social wage. No wonder British voters are angry and disillusioned. Theresa May, aware of the imminence of a general election, is worried by public anger, and has called for an end to austerity. The Treasury will defy her – successfully, just as they have defiedRead More »
The following article was written for the Progressive Economy Forum’s publication – Ten Years Since the Crash: Causes, Consequences and the Way Forward – circulated at Labour Party Conference in October, 2018.
13th September, 2018
To fix things we need to first tell ourselves the correct story about how we got here. Financialization is easily the least studied and least explored reason behind our inability to create shared prosperity – despite our being the richest and most successful nation in history.
Rana Foroohar, in Makers and Takers: the rise of finance and the fall of American business.
After forty years of financial liberalisation, a progressive government will face many challenges. Some of the biggest will be management of Britain’s finance sector and, together with partners,
After attending a performance of the Lehman Trilogy, I was honoured to join a panel at the National Theatre on 16th October, 2018 to discuss the play. Readers will know that the play was directed by Sam Mendes, and starred three great actors in all of the complex parts: Simon Russell Beale, Adam Godley and Ben Miles. It was, and is a tour de force, and has now moved to New York.
At that invite-only side discussion of the play, an audience of 100 gathered in a private room at the NT. They included WSJ guests and subscribers, current and prospective corporate partners of the NT, and individual donors to the NT. Our Chair was Gerry Baker (Editor-At-Large of The Wall Street Journal) Sir Damon Buffini (founding partner of Permira and Chair of the National Theatre Board), Bob Diamond (former
The following is an interview with Yena Yoon – a financial journalist with Chosen Ilbo “the largest newspaper in South Korea” conducted on 12 February, 2018, but still relevant.
What is the most remarkable change in financial market after 2008 global crisis do you see? Why do you think so?
The most striking outcome from the global financial crisis of 2007-9 was that there was no structural change to the international financial architecture/system – the system that was at the heart of the global crisis. Instead policy-makers imposed on to the existing financial system – of financial deregulation and capital mobility – two policies: monetary easing and fiscal consolidation. This ‘economic model’ of monetary radicalism and fiscal conservatism has slowed global economic recovery in a way that
Readers of this blog may know that Patrick Allen, founder of the Progressive Economy Forum (PEF) invited me to become a member of its distinguished Council in July this year. Other members include Professors John Weeks, Joseph Stiglitz, Stephany Griffiths-Jones, Robert Skidelsky, Daniela Gabor, Danny Darling, Ha Joon Chang and Doctors Johnna Montgomery, Geoff Tily, Will Hutton and Guy Standing. I am now supporting the work of the Council, and periodically writing for the Forum. The following is a blog that appeared on the PEF website on 8 October, 2018.
PEF Council member Ann Pettifor explains how all governments finance their spending (and its not from taxation). She deconstructs Theresa May’s address to the Conservative Party Conference with its deliberate framing of Labour governments
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Debates in contemporary economics: origins, confusions and clarity This article was commissioned in August, 2018 by Prof. Abdul Azim Islahi, Chief Editor of the Journal of King Abdulaziz University: Islamic Economics. It was submitted for publication in October, 2018. Minor amendments have since been made. Introduction“Deficit financing” in contemporary economics is controversial – largely because of flawed economic approaches to a sovereign nation’s public finances. The first is the microeconomic approach that treats government budget deficits in much the same way as household deficits. In other words, the assumption that like a household, a government budget deficit is the consequence of a shortfall of government tax revenues over expenditure, and this in turn is due toRead More »
On Wednesday, 19th September and again on 22nd September, the BBC broadcast an interview in which I participated. It was called Cassandras of the Crash. The programme is available on the BBC’s Radio 4 website, with the following introduction.
“Ten years ago, in autumn 2008, the world watched as the biggest financial meltdown in history unfolded. The crash plunged the world into recession, lost millions of families their homes and its shadow still hangs over our politics today. And when the Queen went to the London School of Economics, she asked the question everyone wanted the answer to: why did no one see it coming? In this programme Aditya Chakrabortty, senior economics commentator at the Guardian newspaper, chairs a discussion between four economists who can claim they did: Raghuram
This is an extract from an article written for The Times Literary Supplement
From TLSThe international and financial dimensions of Keynes’ work are today neglected in favour of the laissez-faire economics that Keynes had so vigorously contested. His profession is dominated by economists concerned overwhelmingly with the activities of individuals, households and firms. Management of the macroeconomy and of financial globalization is left largely to investors and speculators in capital markets, with central bankers playing a supportive, interventionist role. This has led to a form of financial anarchy, backed and guaranteed by public institutions and their taxpayers. Worse, it has led to increasingly frequent financial crises. These began first on the fringes of the global economy (in the
Extract from an article written for PEF
Carney does not seem to be aware, but central bankers’ groupthink today unites once again around the “normalcy” of a single policy: financial globalisation, or unfettered financial capitalism. In other words, the deregulation and globalisation of markets in money, goods, services, property and labour is once again the dominant “policy”. And no central bank governor or Treasury politician or official deviates from it.
The remedy for economic failures caused by “the policy” of financial globalisation is not very different from bloodletting, caused by the automatic deflationary policy machinery so revered by Montagu Norman and fellow architects of the Great Depression. Think Greece, Argentina and Turkey… and now South Africa, Indonesia and Malaysia.
John Maynard Keynes – for the Times Literary Supplement It was his internationalism, together with his insights into the functioning of the world’s financial architecture that first drew me to the work of John Maynard Keynes. His genius is, perhaps, most comparable to that of Charles Darwin. But whereas Darwin is widely recognized for developing the science of evolution, Keynes’s development of the science of macroeconomics goes largely unacknowledged by a profession still steeped in classical microeconomics. Both of these very British geniuses met with extraordinary resistance to their ideas – as the persistence of creationism in some circles shows; and by the restoration of the classical school of microeconomics at Keynes’s alma mater, Cambridge University. TheRead More »
The BoE’s decision to raise the Bank Rate to 0.75% is a mistake. It is a mistake comparable to those made by Alan Greenspan’s Federal Reserve in the years between 2003 and 2006.
It is a mistake that must be understood in a wider context. Not just the political context – which promotes ‘monetary radicalism and fiscal conservatism’ – to quote David Cameron and George Osborne. But also in a wider monetary policy context. As the governor of the Bank pointed out recently: ‘the Bank is the only game in town’ …Read the full article on the PEF websiteRead More »
The BoE’s decision to raise the Bank Rate to 0.75% is a mistake. It is a mistake comparable to those made by Alan Greenspan’s Federal Reserve in the years between 2003 and 2006.
It is a mistake that must be understood in a wider context. Not just the political context – which promotes ‘monetary radicalism and fiscal conservatism’ – to quote David Cameron and George Osborne. But also in a wider monetary policy context.
As the governor of the Bank pointed out recently: ‘the Bank is the only game in town’ …
Read the full article on the PEF website
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On 19th July, 2018, I was stunned and honoured to receive the following from Professor Antonia Grunenberg of the Heinrich Boll Foundation, Bremen, Germany.
Berlin, July 19, 2018
Dear Mrs. Pettifor,
it is my great pleasure to inform you in behalf of the international jury of the „Hannah Arendt Prize for Political Thinking“ that you have been unanimously selected to be the winner of the prize in 2018.
Die date of the ceremony is December 7, 2018.
The jury pointed out that you, a distinguished scholar, have had the courage to touch a complex topic that keeps influencing European and world affairs as well as the life of people all over the globe: the domination of the political realm by the dynamics of financial speculation.
Your work such as the recently published book “The production of
On 19th July, 2018, the director of Policy Research in Macroeconomics (PRIME), Ann Pettifor, received the following from Professor Antonia Grunenberg of the Heinrich Boll Foundation, Bremen, Germany. Berlin, July 19, 2018Dear Mrs. Pettifor,it is my great pleasure to inform you in behalf of the international jury of the „Hannah Arendt Prize for Political Thinking“ that you have been unanimously selected to be the winner of the prize in 2018.Die date of the ceremony is December 7, 2018.The jury pointed out that you, a distinguished scholar, have had the courage to touch a complex topic that keeps influencing European and world affairs as well asRead More »