Triple witching hour for austerity:Hollande wins in France, Labour in Britain, anti-austerity in Greece.

A small but significant earthquake has occurred over the past few days in Europe. The victory of the Socialist party in the Presidential race combined with the election results in Greece along with the drubbing of the Conservative and Liberal Democrat pro-austerity party in Britain presage hopefully a shift in policy in response to the economic crisis away from the destructive and failed policies of austerity that have been implemented throughout Europe. Deficit hysteria and the lack of a proper central bank to manage debt and a hidebound austerity oriented elite remote from public opinion has pushed Europe in this dangerous direction. But now democratic elections have allowed the people to push back. Increased deficits and debt are largely the response of the macro-economic system to the severe downturn that struck Europe following the financial crisis. The best way to reverse them is to avoid austerity and work to lower unemployment rates and promote investment and spending to increase aggregate demand and improve competitivity through education, skill building and where appropriate managed trade and sensible adjustment of the exchange value of the currency.The bond market cannot rescue democracies from the vagaries and irrationalities  of the business cycle.

I await with considerable hope the blossoming of this new agenda in Europe. M.Hollande, Mr. Miliband (whose father was one of my favourite teachers at the L.S.E.) and the new Greek leadership as well as other progressive Europeans need to deliver as much as possible in the coming months.


About haroldchorneyeconomist

I am Professor of political economy at Concordia university in Montréal, Québec, Canada. I received my B.A.Hons (econ.&poli sci) from the University of Manitoba. I also completed my M.A. degree in economics there. Went on to spend two years at the London School of Economics as a Ph.D. student in economics and then completed my Ph.D. in political economy at the University of Toronto. Was named a John W.Dafoe fellow, a CMHC fellow and a Canada Council fellow. I also was named a Woodrow Wilson fellow in 1968 after completing my first class honours undergraduate degree. Worked as an economist in the area of education, labour economics and as the senior economist with the Manitoba Housing and Renewal Corporation for the Government of Manitoba from 1972 to 1978. I also have worked as an economic consultant for MDT socio-economic consultants and have been consulted on urban planning, health policy, linguistic duality and public sector finance questions by the governments of Manitoba, Saskatchewan,the cities of Regina and Saskatoon, Ontario and the Federal government of Canada. I have also been consulted by senior leaders of the British Labour party, MPs from the Progressive Conservative party, the Liberal party and the New Democrats on economic policy questions. Members of the Government of France under the Presidency of Francois Mitterand discussed my work on public sector deficits. I have also run for elected office at the municipal level. I first began to write about quantitative easing as a useful policy option during the early 1980s.
This entry was posted in austerity, business cycles, classical economics, deficit hysteria, deficits and debt, European debt crisis, European unemployment, France politics+economy, Greek sovereign debt crisis, Mr.Papandreou and democracy, progressives, treasury view, UK local elections, Uncategorized, unemployment. Bookmark the permalink.

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