Para darle seguimiento a la historia en Europa, en los últimos días los ministros del UE aprobaron un aumento en los recursos destinados al problema europeo para totalizar 800 miles de millones de euros. Aunque parece ser que Alemania habría cedido, ya que se ha opuesto a este paso, para otros analistas resulta aún insuficiente. Los mismos analistas alemanes consideran que no es suficiente como se desprende de esta nota en Der Spiegel on line
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European finance ministers meeting in Copenhagen on Friday agreed to boost the euro-zone firewall to over 800 billion euros. The move marks another U-turn on the part of the Merkel administration, which recently dropped its opposition to increasing the fund. German commentators warn that even the new firewall may still be too small.
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Y seguramente será inutil para aquellos que consideran que el problema está también en la dura medicina aplicada en los programas de austeridad, tal y como lo plantea Andrés velasco en su editorial "Austeridad según San Agustín"... (muy buen editorial!!!)
The relevant logic is at the core of modern macroeconomics – precisely the kind of thinking that European leaders have ignored at their peril. A country with a large public debt (say, more than 50% of GDP) is safe if everyone thinks the debt will be serviced; the interest rate charged on the debt remains low, and the country can indeed pay it, following a path of virtuous self-fulfilling expectations.
But everything changes if markets come to doubt that the debt will be repaid; then the interest rate demanded by investors can rise so high that the country cannot pay. Default follows, owing to a vicious self-fulfilling panic.
.....The key to the solution lies in St. Augustine’s plea: “Grant me chastity and continence, but not yet.” A fiscal compact like the one approved recently is useful to anchor expectations of future adjustment, but only if the new system is flexible enough to be politically credible.
Up-front gradualism must be the name of the game. And adjustment must be wedded to a growth strategy. Revenue will grow consistently only if the tax base – that is, the economy – grows. And that growth requires higher public investment in infrastructure and human capital.
The guardians of orthodoxy are not about to put forward such a growth strategy. Will anyone else?
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European finance ministers meeting in Copenhagen on Friday agreed to boost the euro-zone firewall to over 800 billion euros. The move marks another U-turn on the part of the Merkel administration, which recently dropped its opposition to increasing the fund. German commentators warn that even the new firewall may still be too small.
.
Y seguramente será inutil para aquellos que consideran que el problema está también en la dura medicina aplicada en los programas de austeridad, tal y como lo plantea Andrés velasco en su editorial "Austeridad según San Agustín"... (muy buen editorial!!!)
The relevant logic is at the core of modern macroeconomics – precisely the kind of thinking that European leaders have ignored at their peril. A country with a large public debt (say, more than 50% of GDP) is safe if everyone thinks the debt will be serviced; the interest rate charged on the debt remains low, and the country can indeed pay it, following a path of virtuous self-fulfilling expectations.
But everything changes if markets come to doubt that the debt will be repaid; then the interest rate demanded by investors can rise so high that the country cannot pay. Default follows, owing to a vicious self-fulfilling panic.
.....The key to the solution lies in St. Augustine’s plea: “Grant me chastity and continence, but not yet.” A fiscal compact like the one approved recently is useful to anchor expectations of future adjustment, but only if the new system is flexible enough to be politically credible.
Up-front gradualism must be the name of the game. And adjustment must be wedded to a growth strategy. Revenue will grow consistently only if the tax base – that is, the economy – grows. And that growth requires higher public investment in infrastructure and human capital.
The guardians of orthodoxy are not about to put forward such a growth strategy. Will anyone else?
