Tag Archives: Journalism, Project Syndicate "Against the Current"

  LONDON – Let’s be honest: no one knows what is happening in the world economy today. Recovery from the collapse of 2008 has been unexpectedly slow. Are we on the road to full health or mired in “secular stagnation”? Is globalization coming or going?  Policymakers don’t know what to do. They press the usual (and unusual) levers and nothing happens. Quantitative easing was supposed to bring inflation “back to target.” It didn't. Fiscal contraction was supposed to restore confidence....

   LONDON – The Republican establishment has gone into overdrive to present President-elect Donald Trump as a guarantor of continuity. Of course, he is nothing of the sort. He campaigned against the political establishment, and, as he told a pre-election rally, a victory for him would be a “Brexit plus, plus, plus.” With two political earthquakes within months of each other, and more sure to follow, we may well agree with the verdict of France’s ambassador to the United States: the...

   LONDON – The most dramatic economic effect of the United Kingdom’s Brexit vote has been the collapse of sterling. Since June, the pound has fallen by 16% against a basket of currencies. Mervyn King, the previous governor of the Bank of England, hailed the lower exchange rate as a “welcome change.” Indeed, with Britain’s current-account deficit running at over 7% of GDP – by far the largest since data started being collected in 1955 – depreciation could be regarded as a boon. But...

  LONDON – Fiscal policy is edging back into fashion, after years, if not decades, in purdah. The reason is simple: the incomplete recovery from the global crash of 2008. Europe is the worst off in this regard: its GDP has hardly grown in the last four years, and GDP per capita is still less than it was in 2007. Moreover, growth forecasts are gloomy. In July, the European Central Bank published a report suggesting that the negative output gap in the eurozone was 6%, four percentage...

  Most people are more worried by government debt than about taxation. “But it’s trillions” a friend of mine recently expostulated about the United Kingdom’s national debt. He exaggerated a bit: it is £1.7 trillion. But one website features a clock showing the debt growing at a rate of £5,170 per second. Although the tax take is far less, the UK government still collected a hefty £533.7 billion in taxes in the last fiscal year. The tax base grows by the second, too, but no clock shows...

LONDON – The horrendous attack by a French-Tunisian man on a crowd in Nice celebrating Bastille Day, which killed 84 and injured hundreds more, will give National Front leader Marine Le Pen a massive boost in next spring’s presidential election. It doesn’t matter whether the murderer, Mohamed Lahouaiej-Bouhlel, had any links to radical Islamism. Throughout the Western world, a toxic mix of physical, economic, and cultural insecurity has been fueling anti-immigration sentiment and politics...

LONDON – Britain isn’t the only country holding a referendum this month. On June 5, Swiss voters overwhelmingly rejected, by 77% to 23%, the proposition that every citizen should be guaranteed an unconditional basic income (UBI). But that lopsided outcome doesn’t mean the issue is going away anytime soon.Indeed, the idea of a UBI has made recurrent appearances in history – starting with Tom Paine in the eighteenth century. This time, though, it is likely to have greater staying power, as the...

Negative interest rates are simply the latest fruitless effort since the 2008 global financial crisis to revive economies by monetary measures. When cutting interest rates to historically low levels failed to revive growth, central banks took to so-called quantitative easing: injecting liquidity into economies by buying long-term government and other bonds. It did some good, but mostly the sellers sat on the cash instead of spending or investing it.Enter negative interest-rate policy. The...

LONDON – The European Union has never been very popular in Britain. It joined late, and its voters will be asked on June 23 whether they want to leave early. The referendum’s outcome will not be legally binding on the government; but it is inconceivable that Britain will stay if the public’s verdict is to quit. Over the years, the focus of the British debate about Europe has shifted. In the 1960s and 1970s, the question was whether Britain could afford not to join what was then the...

LONDON – In recent decades, economics has been colonizing the study of human activities hitherto considered exempt from formal calculus. What critics call “economics imperialism” has given rise to an economics of love, of art, of music, of language, of literature, and of much else. The unifying idea underlying this extension of economics is that whatever people do, whether it is making love or making widgets, they aim to achieve the best results at the least cost. These benefits and...