all at once. A nibble here, a bite there... as the opportunities present.
A general diminution of Eurozone nations' fiscal independence. Extensions to the European Stability Mechanism. The planned European Fiscal Board etc. See the insistence on technocratic administrations in Rome and Athens circa 2011... the water-boarding of Greece last summer.
The currency union that France insisted on to bind Germany to European (read: French) goals upon reunification has instead become an instrument for binding the rest of Europe to Germany.
The euro can't be allowed to fail or else the entire edifice of the EU will likely crash down with it. Ergo, they'll do whatever it takes. Caveat: if the world-economic nervousness of today becomes 2007/8 part deux, almost anything is possible [even your mooted euro failure].
Last edited by Absolute_Zero on Sat Mar 05, 2016 6:20 pm 0, edited 1 time in total.
Nonsense. He was one of the most important economists of the 20th century. He established the principles which form the basis of all developed economies today. Here his theories were incorporated into the UK economy under Thatcher, but also under Major and Blair. No mainstream economist or politician now thinks we should go back to the failed policies of the 1970s, before Friedman’s contributions.
No-one gets everything right over their lifetime but Friedman was right on far more things than he was wrong on. In particular he was right on the euro:
The drive for the Euro has been motivated by politics not economics. The aim has been to link Germany and France so closely as to make a future European war impossible, and to set the stage for a federal United States of Europe. I believe that adoption of the Euro would have the opposite effect. It would exacerbate political tensions by converting divergent shocks that could have been readily accommodated by exchange rate changes into divisive political issues. Political unity can pave the way for monetary unity. Monetary unity imposed under unfavorable conditions will prove a barrier to the achievement of political unity.
That was written in 1997, before the euro started and a decade before the crisis, but predicts it with great accuracy. The problems at its core is one of imbalances – divergences between nations – not debt. Only Greece had a debt problem at the start of the crisis, and a much more manageable one. A debt crisis has been manufactured, for political reasons, and this has become a political crisis which is now feeding into other areas such as immigration.
His last sentence points to why ever closer union has stopped. The euro itself, intended to drive further integration, has had the opposite effect. Now countries know that the euro can only work if they surrender a lot more authority to Brussels. But they are too scared to admit this to voters, they know there is no appetite for it. People in the EU want less European control, not more. They don’t want Brussels setting tax rates, retirement ages, benefit rates.
merman wrote:Economies the world over freely co-operate and trade using different currencies. Having a large trading bloc using the same currency is incredibly possible. After all, British tills are reprogrammed regularly for changes in coinage, how hard is it to change over to the Euro?
It would be easy to make the change. But the euro shows how we would be stuffed if we shared the same currency.
Remember that in the crisis her the pound fell by 30-40% in a short period of time. This was highly painful; inflation spiked as many imports rose in price, while wage inflation stagnated due to the recession. But it was very good for the economy. Better export prices meant many firms could weather the recession without large job losses. Some businesses were able to grow as we became more competitive. Unemployment rose but quickly peaked and soon started falling as the economy recovered.
Most crisis countries in Europe would love to do the same but they can’t if they are in the euro. Instead they can only regain competitiveness by large wage cuts. Or, unable to quickly achieve the cuts needed, they are stuck with high unemployment and stalled recoveries.
Ah, I think I've got it. You seem to think that "economic theory" is some sort of science, as opposed to the pure bunkum it truly is.
"massive retard™", "full of shit™", "tiny bitch™", "retarted™", "a bit of a one trick pony™", "petty™", "simple minded idealistic twat™", "miserable humourless fucker™"
pogo wrote:Nonsense. He was one of the most important economists of the 20th century. He established the principles which form the basis of all developed economies today
Well yeah.
He bears indirect responsibility for the banking collapse characterising any company activity outside of seeking profit for shareholders as theft. Friedman provided a pseudo academic legitimisation for fuck you, I'm alright jack that certain sectors of business and government took up with glee.
He bears indirect responsibility for the banking collapse...
I don’t think so – a banking collapse would have happened without him. The bank crisis here and in the US was due to too much leverage – too much borrowing – and that didn’t start with monetarism. Friedman died in 2006 but if he were still around for the banking crisis he surely would have been consulted for his expertise, having co-written “the leading and most persuasive explanation of the worst economic disaster in American history, the onset of the Great Depression” (according to Ben Bernanke).
tufty wrote:Ah, I think I've got it. You seem to think that "economic theory" is some sort of science, as opposed to the pure bunkum it truly is.
Irony cubed. All I recall of your publicly announced voting intentions is support for an ideology fundamentally founded on a dysfunctional, practically extinct (IRL) economic theory.
Communism is a social, political, and economic ideology and movement whose ultimate goal is the establishment of the communist society, which is a socioeconomic order structured upon the common ownership of the means of production and the absence of social classes, money, and the state.
He bears indirect responsibility for the banking collapse...
I don’t think so – a banking collapse would have happened without him. The bank crisis here and in the US was due to too much leverage – too much borrowing – and that didn’t start with monetarism. Friedman died in 2006 but if he were still around for the banking crisis he surely would have been consulted for his expertise, having co-written “the leading and most persuasive explanation of the worst economic disaster in American history, the onset of the Great Depression” (according to Ben Bernanke).
Is this Ben Bernanke here, who applauds Friedman's work on the great depression.. work which laid the blame at the door of the federal reserve.. is this the same Ben Bernanke who was chairman of the federal reserve whilst the great recession happened on his watch?
Was Bernanke taking the piss out of Friedman posthumously when he doled out trillions of tax payers dollars to the bankers?
Poor old Milt.. never did get to see his free markets implemented by those he advised. Not Reagan... Thatcher.. not even PINOCHET
Regarding the EU referendum, there is a possibility that, simply by calling it, we've fucked ourselves over already.
If we say "yes", then we're sanctioning the unreformed mess that is the EU as it currently stands.
I'm all for "project Europe" in a general sense, you understand - if they gave us a vote on forming a "United States of Europe" (similar in structure to the USA) then I'm willing to entertain that notion perfectly seriously - but the exact creeping, stealthy, ad-hoc, patchwork implementation we've got now, in the form of the EU, is just a bloody mess that, really, no-one is supporting.
(Because you'll notice carefully that Cameron invites to join a "reformed EU" and many campaigning to stay in are arguing on the basis of "we can eventually help fix it if we're in on the inside, but can't do anything from outside", so even the "yes" folks are caveating it as "sign up to the general idea of European union because, yes, the exact implementation in the EU that we've got now, does seriously need some fixing".)
But if we vote "yes" then this sends the message "everything is fine, just carry on carrying on" to the EU, so what's their motivation for listening to the UK regarding the need for necessary reforms?
And pogo has covered how, if we vote "no", then the EU is almost obliged to punish us for that. If we vote "out" and clearly benefit greatly from doing so, that's an existential threat to the EU, as it'll encourage others to follow suit. So they can't really allow the precedent to be set. See Hollande's "there will be consequences" - trying his best not to sound threatening or unfriendly, as he's not wanting to be that at all, but rather his hands are tied. He's obliged to be an arsehole and help with punishing the UK for leaving, as they've got to stem the bleed to stop it turning into a haemorrhage that'll kill the EU as it bleeds out.
Leaving us with the possibility that we've screwed ourselves over already, either way, simply by threatening the possibility of leaving from a weak position. Good one, Dave!
"Words ought to be a little wild - for they are assaults of thought on the unthinking."
- John Maynard Keynes
KlaxonCow wrote:Leaving us with the possibility that we've screwed ourselves over already, either way, simply by threatening the possibility of leaving from a weak position. Good one, Dave!
Look on the bright side. This election pledge ploy could culminate in schisms that evolve into European war, but at least the Tories got into office!
He bears indirect responsibility for the banking collapse...
I don’t think so – a banking collapse would have happened without him. The bank crisis here and in the US was due to too much leverage – too much borrowing – and that didn’t start with monetarism. Friedman died in 2006 but if he were still around for the banking crisis he surely would have been consulted for his expertise, having co-written “the leading and most persuasive explanation of the worst economic disaster in American history, the onset of the Great Depression” (according to Ben Bernanke).
I'm being really clear that the fuck everything but profit in the commercial sector has fuelled short termist, greed oriented company stewardship.
A successful relationship depends on mutual benefit for both partners. Friedman's view of the relationship between commerce and society is that business should take all it can and pay as little back in as is humanely possible. And that's a successful strategy. For a while. Long term it's fucked.
To be fair blaming Friedman for cunts might be a little like blaming Wagner for the Nazis. But there you go
The way these things usually go, is for the established position to strengthen as we approach the day. Much as opposition support is usually exaggerated mid-term compared to when the rubber-meets-the-road at a general election.
60/40 still gets my vote. The best hope I see for the leavers is a significant up-tick in chaos on the continent.
KlaxonCow wrote:If we say "yes", then we're sanctioning the unreformed mess that is the EU as it currently stands.
...
But if we vote "yes" then this sends the message "everything is fine, just carry on carrying on" to the EU, so what's their motivation for listening to the UK regarding the need for necessary reforms?
You are being far too negative. This is not a referendum on how the EU is run, so a yes vote does not mean “everything is fine”. Any international agreement like the ones that formed the EU involves a degree of compromise, and there are things in the EU we don’t like. But still we should vote to stay in.
One reason is, if we left, then we would still have to adopt most or all of the EU trade, immigration and labour regulations we do now. It’s just part of getting a trade deal with the EU. Ask Norway or Switzerland. The only difference would be outside the EU we would have no say in devising the regulations. They would be decided by the rest of the EU without us (and that’s ignoring the heavy cost of the disruption as we negotiate new agreements).
Another reason is we already have opt outs from the “worst” bits of the EU. We are not in Schengen, we are not in the euro. While Greece might need to leave the EU to restore monetary independence with its own currency we don’t need to. The Jungle at Calais is a perennial problem but it’s nothing like on the scale of the migrant crisis in the rest of the EU.
Finally do not think the EU is set in stone. The eurozone debt crisis and the migrant crisis are forcing them to belatedly address the problems that poorly planned and half-hearted integration have caused. In theory the best solution is much more integration, but there is no appetite for that. So instead we will hopefully get genuine reform, and rolling back some of the integration that does not work. I cannot see Schengen surviving in it’s current form.
