Madmen in Authority: That ’30s Feeling
Einige Auszüge aus bzw. Hinweise auf die Kolumnen von Paul Krugman in der NYT:
... What’s the economic logic behind the government’s moves? The answer, as far as I can tell, is that there isn’t any. Press German officials to explain why they need to impose austerity on a depressed economy, and you get rationales that don’t add up. Point this out, and they come up with different rationales, which also don’t add up. Arguing with German deficit hawks feels more than a bit like arguing with U.S. Iraq hawks back in 2002: They know what they want to do, and every time you refute one argument, they just come up with another.
Here’s roughly how the typical conversation goes (this is based both on my own experience and that of other American economists):
German hawk: “We must cut deficits immediately, because we have to deal with the fiscal burden of an aging population.”
Ugly American: “But that doesn’t make sense. Even if you manage to save 80 billion euros — which you won’t, because the budget cuts will hurt your economy and reduce revenues — the interest payments on that much debt would be less than a tenth of a percent of your G.D.P. So the austerity you’re pursuing will threaten economic recovery while doing next to nothing to improve your long-run budget position.”
German hawk: “I won’t try to argue the arithmetic. You have to take into account the market reaction.”
Ugly American: “But how do you know how the market will react? And anyway, why should the market be moved by policies that have almost no impact on the long-run fiscal position?”
German hawk: “You just don’t understand our situation.”
The key point is that while the advocates of austerity pose as hardheaded realists, doing what has to be done, they can’t and won’t justify their stance with actual numbers — because the numbers do not, in fact, support their position. Nor can they claim that markets are demanding austerity. On the contrary, the German government remains able to borrow at rock-bottom interest rates...
Germans tend to think of running deficits as being morally wrong, while balancing budgets is considered virtuous, never mind the circumstances or economic logic. “The last few hours were a singular show of strength,” declared Angela Merkel, the German chancellor, after a special cabinet meeting agreed on the austerity plan. And showing strength — or what is perceived as strength — is what it’s all about.
There will, of course, be a price for this posturing. Only part of that price will fall on Germany: German austerity will worsen the crisis in the euro area, making it that much harder for Spain and other troubled economies to recover. Europe’s troubles are also leading to a weak euro, which perversely helps German manufacturing, but also exports the consequences of German austerity to the rest of the world, including the United States....
Paul Krugman, NYT, Published: June 17, 2010 via nds
Siehe auch hier: Pany bei TP: Verrückte an der Macht oder hier ...
Nachtrag der chefarztfrau:
... What’s the economic logic behind the government’s moves? The answer, as far as I can tell, is that there isn’t any. Press German officials to explain why they need to impose austerity on a depressed economy, and you get rationales that don’t add up. Point this out, and they come up with different rationales, which also don’t add up. Arguing with German deficit hawks feels more than a bit like arguing with U.S. Iraq hawks back in 2002: They know what they want to do, and every time you refute one argument, they just come up with another.
Here’s roughly how the typical conversation goes (this is based both on my own experience and that of other American economists):
German hawk: “We must cut deficits immediately, because we have to deal with the fiscal burden of an aging population.”
Ugly American: “But that doesn’t make sense. Even if you manage to save 80 billion euros — which you won’t, because the budget cuts will hurt your economy and reduce revenues — the interest payments on that much debt would be less than a tenth of a percent of your G.D.P. So the austerity you’re pursuing will threaten economic recovery while doing next to nothing to improve your long-run budget position.”
German hawk: “I won’t try to argue the arithmetic. You have to take into account the market reaction.”
Ugly American: “But how do you know how the market will react? And anyway, why should the market be moved by policies that have almost no impact on the long-run fiscal position?”
German hawk: “You just don’t understand our situation.”
The key point is that while the advocates of austerity pose as hardheaded realists, doing what has to be done, they can’t and won’t justify their stance with actual numbers — because the numbers do not, in fact, support their position. Nor can they claim that markets are demanding austerity. On the contrary, the German government remains able to borrow at rock-bottom interest rates...
Germans tend to think of running deficits as being morally wrong, while balancing budgets is considered virtuous, never mind the circumstances or economic logic. “The last few hours were a singular show of strength,” declared Angela Merkel, the German chancellor, after a special cabinet meeting agreed on the austerity plan. And showing strength — or what is perceived as strength — is what it’s all about.
There will, of course, be a price for this posturing. Only part of that price will fall on Germany: German austerity will worsen the crisis in the euro area, making it that much harder for Spain and other troubled economies to recover. Europe’s troubles are also leading to a weak euro, which perversely helps German manufacturing, but also exports the consequences of German austerity to the rest of the world, including the United States....
Paul Krugman, NYT, Published: June 17, 2010 via nds
Siehe auch hier: Pany bei TP: Verrückte an der Macht oder hier ...
Nachtrag der chefarztfrau:
Merkel belehrt Obama
Der in ökonomischen Fragen völlig
unbedarfte US-Präsident besaß jüngst die Frechheit, die großen
Exportnationen dazu aufzufordern, ihre Binnennachfrage zu erhöhen. Dass
das ein völlig blödsinniger Vorschlag ist, erklärt ihm jetzt Frau
Merkel: Deutschland sei nämlich Teil des globalen Binnenmarktes und die
Handelsbilanz eines Planeten ohne Raumkolonien und außerirdische
Handelskontakte müsse doch wohl per Definition ausgeglichen sein. So what, stupid?
gebattmer - 2010/06/19 18:25
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