Economics

马上结束紧缩

Aug 20, 2013 Mark Blyth

爱丁堡—最近几周，关于欧元区复苏萌芽的讨论声音建起，关键指标表明核心国已步入扩张——很多人将这些数据作为紧缩最终奏效的证据。来自美国的货币市场基金又开始为欧洲银行债务提供资金了，尽管动作极为谨慎。就连高盛目前也看好欧洲股市。但复苏真的已经开始了吗？

怀疑派还记得，关于欧洲复苏的预期早在2010年第四季度就已经出现，自此以后，IMF次次都会预测“年底”复苏。但是，GDP出现了崩溃，西班牙和意大利经济今年预计将收缩2%。葡萄牙经济将收缩超过2%，希腊产出可能下降4%。

此外，欧元区失业率水平达到了惊人的程度，平均为12%左右，外围国年轻人失业率更是超过了50%，这意味着人才的长期损失和税基的侵蚀。而尽管欧元区失业率居高不下，生产率水平却稳稳地处于负区间。

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0 Comments on this paragraph, 8 Comments on this article

Carol Maczinsky Aug 26, 2013

I can't see any austerity policies in Europe right now.
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Michael Hennigan - Finfacts Aug 25, 2013

Still, one can wonder how Mark Blyth, as a finance minister of one the main core countries, would have reacted to the challenges?

In Ireland from the late 1990s, income and capital taxes were cut and the low corporate tax was extended to domestic business. The proportion of income earners exempt from income tax increased from 34% in 2004 to 45% in 2010.

There was no real world growth absent the property bubble from 2001 and when the bust came, public revenues were suddenly in a sink hole with the loss of property-related revenues. Meanwhile, spending on social protection which stood at €7.84bn in 2001 had grown to €20bn while inflation increased by around 30% during the same period. In 2001 the Irish public service pay and pensions bill (ex local authorities) was €10.2bn; it was €16.2bn in 2006 (the peak year of the bubble); €17.6bn in 2007; €18.7 in 2008 and €17bn in 2012.

In a short time, Ireland went from being perceived as having a 'miracle economy' to one where many expected gifts like the cargo-cultists of the South Pacific.

However, while there was no Santa Claus and the sustainability of debt remains a big question, beyond the 24% unemployed (broad rate), the international bailout has ensured that life for many has remained relatively unscathed. Taxes remain below levels in many European countries; doctors remain among Europe's best paid and the well-connected lawyers are coining it through boom and bust. The tourism and travel deficit (excess of outward travel) in 2012 was almost unchanged compared with 2007.

As for Greece, it had fiddled its national accounts data and it's not clear if Mark Blyth as a finance minister, would have been happy to transfer cash without strings.

Without external pressure, the scrounging elites would surely have used such cash prudently!

For example, George Papandreou, then Greek prime minister, told Der Spiegel in early 2010: "In a study done last year, the OECD described government-run Greek hospitals as deeply corrupt. It concluded that we could save 30% of the costs, which is enormous. The hospitals generated a deficit of €7bn last year. Imagine what an unbelievably large amount of money we could save by simply introducing computers into hospitals. Until now, there has been far too little control over the purchasing of medications and equipment. In Germany, a stent for heart operations costs about €500. In Greece it costs €2,000 to €2,500. The fault lies with corruption."

Mark Blyth uses terms such as 'skyrocketed' and 'collapsed,' but Italy hardly grew at all in the years that preceded the crisis and it's unemployment is back to the mid 1990s level. Just before its property boom, Spain had a jobless level of 21% in 1997.

As for youth unemployment being over 50%, it's bad but not as bad as that figure suggests - according to Eurostat, when for example youth in Greece who are in third level education are excluded from the denominator, the rate of 55.3% in 2012 becomes an unemployment ratio of 16.1%; Spain's falls from 53.2% to 20.6%.
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Moctar Aboubacar Aug 24, 2013

From Brown lectures to FT articles, no one has quite influenced how I see the financial crisis quite like prof. Blythe. I hope this is more than a one-time column on this site.
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Jay Mac Aug 23, 2013

While experts are quick to place the blame of the lack of recovery in Europe solely at the feet of austerity, why do they consistently fail to address the fact that years of unrealistic and unsustainable fiscal policies have simply come home to roost and are bearing the fruit of their acceptance? Until impediments to production are removed, no amount of stimulus spending or convenient blaming of outcomes on austerity will provide a permanent solution to the economic malaise.
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José Luiz Sarmento Ferreira Aug 23, 2013

When austerity programs were first implemented, their alleged purpose was to decrease debt, not to increase it. But debt has increased in every instance, without exception.

So austerity has failed and must be replaced by more effective policies, right?

Wrong. We are told it must go on and on until some miracle happens to make it work.

And so I wonder: What if debt reduction was never intended? What if deficit reduction was never intended? What if the whole exercise has always had one, and only one purpose - creating rents for the financial oligarchies?

Doesn't this explanation fit the observed, and by now undeniable, facts much better than the "profligacy and laziness" myth that Northern European right-wing politicians have been selling to their constituencies with the help of the unscrupulous tabloid media?
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Marc Sargen Aug 22, 2013

If the Euro Members find that a common currency is to burdensome to use then they should give it up. That is simple. Since they don't do it, then the benefits that they had been, are, or believe they will receive outweighs the problems they believe they are currently having.
The issue is they want the benefits of both & are complaining because they can't have it.
Prior to 2000 plenty of the weaker countries in Europe were having issues with rampant inflation & the need to borrow in Dollars or Marks because they were few would lend in a weak & devaluing currency. Many though the Euro would wave a magic wand to solve these issue but they did not go away & are now much worse because they have been ignored for a decade +.
- José Luiz Sarmento Ferreira Aug 23, 2013
  
  None of the Euro Members - and this goes for Germany as well as for Greece - are political monoliths. There are forces in all of them that would benefit and forces that would lose by leaving the Euro. It is quite possible that a common currency is too burdensome for "Spain" to use; if so, "Spain" should indeed give it up.
  
  But who exactly is "Spain"? The Spanish people or the Spanish bankers? It doesn't matter how burdensome the common currency is for the people as long as the bankers are in charge.
  
  And as long as the bankers are in charge, all will go well. If not for "Germany", "Austria", "Finland" and so on, at least for their financial oligarchies.
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Tomas Kurian Aug 21, 2013

Very true, excellent analyses.

And add to the wrong solutions one, that all across Europe is aiming at postponing the retirement age as a result of deficit in pension systems.

Why this is exactly the opposite from what we should be doing, you can read at:

www.genomofcapitalism.com, chapter
4.3.1 Postponing the pension age – the biggest economical nonsense ever

The world experienced huge increases of productivity in the last 20-30 years, but somehow failed to pass these gains to the people in the form of more free time.
As technological progress advances, higher and higher taxes are needed to maintain the aggregate demand keeping up with AS. Without higher taxation, bigger share of profits go towards capital, which is not able to spend it. So employees supplement their missing income with loans - but this is not a sustainable solution and leads to current problems of too high leverage.

Read about this, the possible solution and more at:
www.genomofcapitalism.com
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https://prosyn.org/LQYYmuGzh

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