Ilargi: The Broken Model of the Eurozone

Yves here. There is a solution of sorts to the problem of the “competitiveness” of Eurozone periphery countries, which is for them to lower wage rates to improve their terms of trade. Unfortunately, that still does not resolve the issue of needed to import other inputs, like energy and sometimes raw materials, at Eurozone-wide price levels. And the response to crushing wages (or the super high unemployment that results from not being able to “adjust”) is that the people most able to leave, which is usually the young and best educated, depart.

By Raúl Ilargi Meijer, editor-in-chief of The Automatic Earth. Originally published at Automatic Earth

I stumbled upon these few words in an Ambrose Evans Pritchard article the other day, and they hit me almost like some sort of epiphany, which in turn made me feel a little stupid, because it’s all so obvious. What Ambrose wrote (and this time I’m not making fun of him), was about the eurozone (EMU), of which he said:

The North is competitive. The South is 20% overvalued.

And I realized that’s all you need to know about the eurozone, and about why it will fail. Or has already failed, to put it more accurately. There’s no other information required. Other than a bit of context perhaps to clarify.

Before the euro, and the eurozone, countries like Greece, Spain, Italy, Portugal, would perform 20% or more lower economically than Germany or Holland would. And that was kind of alright, because periodically, their governments and central banks would revalue (devaluate) their currencies down against for instance the Deutschmark by those same 20% or so.

Of course Germany hated this to an extent, since it made it harder for its industries to compete against Greek and Italian companies. Which may by the way well be a mostly hidden reason for them to push the eurozone on the Mediterranean. Devaluation still worked for many years, though, and as we presently find, it was the only thing that could have worked.

Today, because they now have the same currency, and devaluation is thus impossible, and southern Europe also still underperforms the north, there’s only one possible outcome: the south keeps getting poorer all the time. It’s inevitable. Unless Greece starts outproducing the Germans, and we all start driving Hellas quality cars, but that’s not in the cards.

The fatal flaw in the eurozone model is that there’s no way, no escape clause, to rectify the inherited differences between north and south. Moreover, because there isn’t, the differences must and will get bigger. There’s nothing any kind of stimulus by the ECB or EU can do about that.

Unless they directly tax the Germans and Dutch and Finns with the stated purpose of handing what they raise directly to the Greeks. Not going to happen. And there was never any intention of doing such a thing. The Germans wanted to expand their distribution markets, and the Greeks were promised they’d get richer by default if they joined the shared currency.

Neither side thought this through, not with a longer – or even medium – term view. The Greeks et al are the first to pay the price, but the Germans will end up paying as well, no matter how the growing tensions and differences end up being resolved.

All anyone ever considered was a tide to lift all boats. But there is no such tide now. There is no economic growth, other than perhaps in a few niche markets (and they will fall too). And no provisions or plans were ever drafted for this to happen.

Ambrose’s 20% may be underestimating things, or overestimating them. It makes no difference other than perhaps in the timing of events. And not all southern nations will be overvalued – and underachieving – vis a vis Germany – by the same percentage. But that doesn’t matter either down the line.

All countries that entered the EU in the past received large sums of money for things like infrastructure projects. But that money is long gone. Now it’s back to the same performance ratios that have existed for many decades, if not for centuries.

The only thing that might help southern Europe here would be debt restructuring on a massive scale. Still, that would be considered far too costly by the north, provided it even could be achieved in a globalized finance system (look at Argentina).

What makes this interesting is that there is now a question of responsibility. Are only the Greeks accountable for their debts, or is the entire eurozone, given that they share a common currency? These are issues that should have been resolved in times of plenty; in times of less they will prove extremely hard if not impossible to solve.

Northern Europeans see their lifestyles being cramped from many sides in the ongoing crisis, and they would not accept more being taken from them to be handed to Greece. Even if 50%+ of young Greeks have no jobs, and over 40% of Greek children grow up in poverty. That’s not how the union was explained to them. And they would not have agreed if it had been.

The fact that Brussels has attracted a highly dubious breed of politician and bureaucrat certainly hasn’t helped, and still doesn’t. But it’s not the core problem. The core is that there never was a mechanism to reconcile the 20% differences, which means we’re fast on our way to 30% and more. Nothing anybody can do about that other than to leave the union.

The EU was founded on ideals of peace. But unless someone does something, fast, it will be the source of bitter and bloody fighting. Better wisen up now, guys (and I don’t mean the leadership, they’ll go on till the end). In math, there are things that just don’t add up. This is one of them.

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37 comments

  1. bmeisen

    Cycles of devaluation, de-skilling and de-resourcing weren’t very sustainable either. Agreed the situation is grim and Juncker confirms rather than disspells fears. Pathetic as it may be, education and the Bologna reforms are key to the current EU’s ability to prevail. Higher education shall be harmonized across the EU allowing students to choose what and where they want to study. In theory it should be as easy to go from Holland to Greece to study as it is to work, or even easier because English is the lingua franca of science if not of industry. ULtimately the educational systems in individual countries should be producing comparable graduates who compete with harmonized qualifications on the level playing field of the European labor market. EU higher ed is developing along the French or British model with explicit roles and public financing for elite institutions like the Grandes Ecoles and Oxford. This policy is undermined by austerity. The results produced by austerity and anti-intellectualism e.g. in Berlusconi’s Italy are especially disheartening.

    1. Chris Geary

      I hope you’re not suggesting the solution to 50% youth unemployment is more and better higher ed?

      1. bmeisen

        there is an element of career training harmonization in the bologna reforms i believe. career training systems have differed as much if not more than higher ed across the eu. under bologna the bachelors degree includes explicit career features including diverse soft skill competencies. this would encourage countries with under-developed career training systems to address deficits via higher ed. countries with elaborated career training are challenged. here the eu bachelors mimics the american bachelors as the blanket professional qualification and might undemine establised alternatives to higher ed.
        the irony is that german families for example who have access to a highly elaborated system of career training increasingly reject career training for example in the trades or specialist areas. they perceive the bachelors as the more desireable qualification. the result is the student numbers in bachelors programs are increasing at the expense of traditional non-academic careers. so yes higher ed is to a degree a solution for 50% youth unemployment.

  2. Finn Win

    “Unless they directly tax the Germans and Dutch and Finns with the stated purpose of handing what they raise directly to the Greeks.”

    Euro is too high for Finland also at the moment. Most liberal fools here are looking a way to make inner devaluation for Finland without crashing a whole economy. Gladly there’s no such a way.

    Our wages rose a little too fast before the Great Depression and right now we are not competitive. Our worst competitor is Sweden and they are devaluing their currency all the time, so this aint really working for us either at the moment.

    I don’t really know how to make this monetary union work without mutual fiscal policy. It’s not really hard to tell that, when you lower wages your economy will probably shrink, if your exports wont skyrocket.

    Only way to make this work is higher wage rises in those countries which have surplus. It was damn foolish to make inner devaluation for few euro countries, cause now they are eating Finland’s growth also, cause they have less to spend and they might produce something what we do cheaper now. Austerity policies shot us into own leg. That was dumb. Also you don’t have to make everything so white and black. You can cut from somewhere and put it to somewhere else. You can do both at the same time.

    This monetary policy is some kind of taboo. Nobody really talks about it on the main stream – just wages, wages, wages…

      1. Finn Win

        This time its more like slow death. 90’s banking crisis was real bad and real fast. Banks took debts in other currencies and private sector took loans like there would be no tomorow. Well, when government run out of foreign currencies, they couldn’t buy more finnish marks and we had to devaluate. Banks couldn’t handle the situation and our government created trash bank called Arsenal, where private banks could dump all their bad loans and continue like nothing would have happen. Because of all this our government debt to gdp went from 14 % to 60 %, thats one hell of a jump. Back then problem was common currency basket test called ECU, preface for euro. Many other countries like England, Sweden and Denmark learned from this test, that common currency without common fiscal policy will end in catastrophe. Well Finland politics have last few decays been little bit slow and they couldn’t make a connection between ECU and euro at millenium and now we are in this hell hole again.

        Export companies are suffering and production is going down. Thats real bad and devaluation would help for that probably. Now companies are just slowly fading away.

        Next economic shock could launch banking crisis here also, cause private sector has gone deeper into debt and I dont know how much banks are ready to lend for these small and mid businesses.

        It’s not as bad for us, than it was few decays ago. Finland have increased government spending and it have worked so far okey, but we really need demand for whole European Union. It’s not good that people are paying houses that they have lost long time ago and young fellas aint got a job, so that they could get a loan for house and other stuff, what they need.

        I would say, that this is more world wide problem this time and we cant solve it alone. We have done our part by spending more, but it aint gonna be enough for whole Europe.

        1. guest

          Out of curiosity, two questions:

          1) What is the situation with real estate? It has been quite a while I have not had a look at those Nordea charts on the price of real estate (there was Helsinki and rest of Finland, as I remember), but last time I checked (about 8 years ago) they were still climbing seemingly without end.

          2) What is the situation in the medium sized towns that used to host important manufacturers (such as Elcoteq or Nokia), e.g. Tampere, Salo, Oulu? Tampere was quite “hot” in the early 2000s, how are things going there now?

          1. Illort

            Answer to your 2nd question:
            Manufacturers have been dissappering. Elcoteq went bankrupt on 2011, although production in Finland stopped long before that. Nokia is in pieces with most production having stopped long before acquisition by Microsoft. Plastics manufacturer Eimo was acquired by Foxconn during 2000s and soon afterwards the factories were shut down, the consensus was among us people that Eimo was bought to get its patents.

            Manufacturing, value added (% of GDP):
            year 2000 – 25 %
            year 2014 – 15 %
            25 % has been sticky, long term value if we view until 1980 and ignore the shock from 1991. Slow decline from 25 % downwards coincides with adoption of Euro in 2002 as the Euro traded far above dollar (biggest reason to the decline of manufacturing IMO).

            German manufacting value added to GDP has been ~22 % from 2000 to 2014 meanwhile, which gives some credence to claim that Euro was a vehicle to keep up Germans exporting power. Finland didnt perform reforms comparable to Hartz plan between 2002-2014, as did no one else in Euro-zone either, so Germany got a double kickstart from these both effects.
            (Data from worldbank.org)

            As for housing prices, atleast in Helsinki it’s totally unaffordable. An approx salary of professional is between 3000 – 4500 per month for starting 5-10 years of career (and even that approx is very positive). Compare this salary with high taxation and the fact that even an apartment in apartment building built in 1970s-80s go for far above 100k, and many of these apartment buildings were built for lifetime of 50-60 years at max (concrete elements), making them very very bad investments. New apartments go almost always above 200k, unless they are very small, and some of these have very low quality because of drive to build them cheap and fast. They look nice though.

    1. Jesper

      Sweden devaluing constantly? Check the EUR/SEK exchange rate for the past decade.

      & this comment: “Nobody really talks about it on the main stream – just wages, wages, wages…” is exactly what you do in your comment: “Our wages rose a little too fast before the Great Depression and right now we are not competitive.”

      1. Finn Win

        Hey mate =P

        “Sweden devaluing constantly? Check the EUR/SEK exchange rate for the past decade.”

        That might have been a little provocative, =) but if you have watched economic news from Finland lately it hasnt been any good, those news would have had effect on forex market and finnish mark would have gone down. Now we are in euro and it aint going down. Year to date EUR-SEK is up 5,40 percent. If you compare finnish and swedish economic news it shouldnt be like this, but theres few countries who are benefiting from euro and many others, who are suffering, because of these few. Finland was one of those benefiting before 2008. Now we are slowly dying.

        “exactly what you do in your comment”

        Yeah and with own currency we could devaluate, we wouldn’t have to talk about wage cuts. If wages goes up too much, you can just print money and buy foreign currencies, thats much more simple than cutting wages.

        You missed the whole point bro. Its not about Swedens beggar thy neighbour policies, so much as it is different fiscal unions with common monetary policies = A lot of problems.

        Jag älskar dig i alla. Ö_ö

        1. Jesper

          Might be provocative but apparently necessary.

          You’ve chosen the dates of comparison that matches your case. Check the exchange rate over the past decade.
          The Swedish industry has lost out and the winners over the decade has been Finland. A couple of months of a minor change and the Finnish Sisu is no more ;-)

          You’d be ok with lowering the wages through devaluations as you think the people in Finland wouldn’t notice the pay-cut? You keep talking about lowering the wages & then you complain about people only talking about lowering of wages….
          About as intellectually honest as your comment about beggar thy neighbour policies.

          And have to love your final diminutive comment, weakens your case more than you realise :-)

          1. Illort

            I can’t agree with your claim that winner has been Finland. Germany is the winner.

            As for the reason for the decline of both Sweden and Finland:
            Long term trend has been privatization of public assets in combination with driving up of housing prices, both of which have have created pressure on wage increases.
            I don’t really understand the dynamics that have led to this increase in price of housing, but I can certainly understand why current and former leaders have not seen it as problem: They have most probably owned houses already, so increase is positive for them, giving them no incentive to curb this increase.
            Reading a bit into history of Finland, opening up of credit markets during 1990s and 2000s might have been the culprit.

            http://ec.europa.eu/economy_finance/publications/country_focus/2013/pdf/cf_vol10_issue6_en.pdf

      2. susan the other

        Well heaven forbid that you are not competitive now jesper because competitiveness is a total fabrication. Who cares?

    2. /L

      Yes and no, Sweden just cut interest rates to depress SEK, but that was from a relative “high” interest level relative ECB. from the beginning of 2000, SEK was held at a fairly stable level to the euro but autumn 2008 CB “panic” and drove the interest rate down the usual relative level to ECB, 2009 ECB started to catch up and 2010 CB worried about households debt levels and drove SEK above the “usual” level to ECB. CB boss Ingves is praised by most Swede “experts” how he “managed” GFC and EZ crisis. To me it seem s a bit volatile:
      EUR_SEK.png 2001-2014

      But BIS have thing called “Change in real effective exchangerate”, and yes relative Piigs Sweden was playing the German game and so did Finland:
      BIS real exchange rate
      The real problem is lack of demand and investments in EU and pseudo currency wars by internal devaluations wont make anything better.

      1. Finn Win

        You are right, that beggar thy neighbours policies aint gonna work. We need investments. Lets build some infra, spaceships and social security, that guarantees basic needs will be taken care for all of us.

        Im more solution oriented fella, but I really dont know how this common monetary policy could work, without common fiscal policies.

        I would like to see common minium wage (doesnt have to be as high as highest at the moment), social security (same, but it would have to be enough for living) and other policies, but I dont see it happening in near future. German would need to start feeding domestic demand and few other countries also, like that god damn neoliberals heaven, called ESTONIA. Screw your citizens in the eye policies are, what they are running at the moment. Higher social security in many countries alone would run gdp up a lot.

        I would myself finance all this straight from ECB, but thats not posssible at the moment so we could invent some pseudobanks, which would distribute these moneys for governments and this all should be earmarked, so that educated fools leading these countries couldnt give it for oligarchs.

        1. /lasse

          Won’t get much help from the new Swedish social democratic gov. Our “worker” finance minister that is an economist examined from our most prominent economist school “Handels” that produce our finest certified neo liberals have declared in the 2015 budget:

          “The tax proposals that are submitted and announced in this bill will contribute to somewhat subdued employment and GDP”
          (budget finansplan och skattefrågor, s. 57)[my translation]

          She claim it to be the tightest budget since the 90s budget sanitizing, which she was part of as political employed at the finance ministry. She is known for her “fearless” management style. A common theme on her appearances is that now we borrow so an so many millions per hour. That is the general government deficit is expected to be about 2.2% and the general government accumulated financial surplus is only 27% to GDP, only Norway and Finland have bigger in OECD, the only 3 OECD countries that have general government, stock, financial surplus.

          1. Finn Win

            Just gotta love it, when people take things out of context and starts fear mongering.
            Its not really a debt if you create money in your own central bank. Your “finest” economic school didnt teach her that, huh? :)

            Don’t worry our finest, wont be even that fine.

            Just gotta put all my hopes in our bureaucrats. Few of them knows whats going on and how world goes around. Hopefully they will share their knowledge for our chosen ones.

            Finland and Sweden are still too small to run whole Europe. We need whole Europe in this, but its a bit hard, cause neoliberals love to get themself slaves. Soon it will just be that there will be nobody who have any demand. Then they will understand, that cutting wont be shortcut to heaven. You cant just produce as cheap as you can. You also need someone, who have power to buy.

            New Deal Europe + Marshall Plan would solve this road to deflation problem, if we would like to solve it.

            Let the governments run the show so long, that all sweatshop countries in the world can catch us, its not smart to compete with these countries, who can make the workers feel most miserable. Lets just print money and buy their stuff with it as long they allow us to do it.

            1. beene

              “Let the governments run the show so long, that all sweatshop countries in the world can catch us, its not smart to compete with these countries, who can make the workers feel most miserable. Lets just print money and buy their stuff with it as long they allow us to do it.”

              Nothing like a simple concise statement, thou might have used neoliberal governments. For most governments are not run for the common good, in Europe or the USA.

            2. cnchal

              Lets just print money and buy their stuff with it as long they allow us to do it.

              That strategy is self defeating as eventually those collecting printed money want to buy productive assets with it.

              A Chinese company bought Smithfield’s Foods, and quite soon we will have a “Sold to China” sign on Canada’s oil sands.

              Even worse for Canadians, is the trade deal just signed with China, which includes the odious Investor State Investment Dispute Resolution mechanism. The Canadian federal government sellout to China is nearly complete.

              . . . cause neoliberals love to get themself slaves. Soon it will just be that there will be nobody who have any demand. Then they will understand, that cutting wont be shortcut to heaven. You cant just produce as cheap as you can. You also need someone, who have power to buy.

              An irony lost on neoliberals. Who has the power to buy, now?

              1. Yves Smith Post author

                No, “printing money” means deficit spending. No future claims.

                Government bonds give investors the option of holding something nearly as safe as cash with some yield. It’s an asset swap. China could just as well hold its FX reserves in cash (which is the form in which it received it, essentially) but prefers to hold Treasuries.

                And the Chinese FX reserves aren’t an investment. They were the result of currency manipulation. YOu might as well think of them as being a sort of residue of not engaging in overt subsidies or tariffs. The Chinese don’t dare spend them because it would drive the renminbi to the moon, the last thing they want.

  3. Ben Johannson

    The fatal flaw in the eurozone model is that there’s no way, no escape clause, to rectify the inherited differences between north and south. Moreover, because there isn’t, the differences must and will get bigger. There’s nothing any kind of stimulus by the ECB or EU can do about that.

    Unless they directly tax the Germans and Dutch and Finns with the stated purpose of handing what they raise directly to the Greeks. Not going to happen. And there was never any intention of doing such a thing. The Germans wanted to expand their distribution markets, and the Greeks were promised they’d get richer by default if they joined the shared currency.

    Naked Capitalism and its community have been saying this for six years; some heterodox economists have done so for ten. And Evans-Pritchard gets the credit?

    1. JustAnObserver

      … and Wynne Godley from the moment the curse-of-Maastricht was first uttered. I doubt if there’s anything AEP has said in the last 5 years that Godley wasn’t warning about 20 years ago.

  4. /lasse

    We can learn from Eurostat:
    “in 2013, more than a third of the population was at risk of poverty or social exclusion in five Member States: Bulgaria (48.0%), Romania (40.4%), Greece (35.7%), Latvia (35.1%) and Hungary (33.5%). On the contrary, the lowest shares of persons being at risk of poverty or social exclusion were recorded in the Czech Republic (14.6%), the Netherlands (15.9%), Finland (16.0%) and Sweden (16.4%). ”

    That we in Europe in the beginning of the 21th century is leaving a poorer state of affairs to our children and grandchildren are not something we have to fear to happen it’s an empirical fact now. We have failed miserably to manage a great inheritance we got from previous generations.

    In the land I did grow up in noticeable homelessness, beggary and mass unemployment did hardly exist, in the new EU/troika europe paradise its the new normal. When I try to explain to my grown up children that never as grown ups have experienced the land that was didn’t have mass unemployment and so on they cant and dont care to grasp it, “so what ..?” its not our reality, we have to adapt to whats now.

    1. beene

      “In the land I did grow up in noticeable homelessness, beggary and mass unemployment did hardly exist, in the new EU/troika europe paradise its the new normal. When I try to explain to my grown up children that never as grown ups have experienced the land that was didn’t have mass unemployment and so on they cant and dont care to grasp it, “so what ..?” its not our reality, we have to adapt to whats now.”

      /lasse, just follow the USA model of making and industry of incarceration. :~) Criminals are our biggest growth area and no other country wants them.

    2. Calgacus

      In the land I did grow up in noticeable homelessness, beggary and mass unemployment did hardly exist, in the new EU/troika europe paradise its the new normal. When I try to explain to my grown up children that never as grown ups have experienced the land that was didn’t have mass unemployment and so on they cant and dont care to grasp it,
      A response I sometimes get from people who do remember that era is even creepier. One thing I like about NC is that when I say- there was no homelessness in the USA (or Europe) back then – people reply with – I think about that all the time. At MMT sites, I have been patronizingly told by otherwise sane MMT (!) people, but with poorer and more flexible memories – that it just wasn’t called homelessness back then, or that they’re just a bit more obvious now, or that social consciousness of such problems is higher now. Anything but believing what is and was in front of our eyes.

      “so what ..?” its not our reality, we have to adapt to whats now.
      They need to be told – No, it is your job to make “reality” adapt to you.

      1. /L

        I probably should, but i’m stupid enough to believe something else is possible, especially when a very recent past empirically shows it’s possible. :-)

        1. Calgacus

          Always glad to see your name, but “probably should” what? What I meant was opposition to the idea that only adaptation is possible. The people who built “the land that was” did not think that way, but made reality adapt to them, as should every generation. I agree, a very recent past shows that a less embarrassingly unjust society is possible. By the way is there any English translation of Wigforss’s Can we afford to work? – or even any text on the net in any language?

          1. /lasse

            Sorry, I did misunderstand that.

            A few.
            ************
            http://bilbo.economicoutlook.net/blog/?p=12499
            Similar figures such as Hardie, Theodore and Curtin stand out in other countries, people like Sweden’s Social Democratic Party Finance Minister Ernst Wigforss. Winton Higgins contributed a great chapter on the ‘Breakthrough in Sweden’ to a 1985 book ‘The 1930’s depression: are there lessons from history?’, edited by Jill Roe, in which he describes how Wigforss denounced the Swedish economic liberal’s calls for belt-tightening during the depression.

            In a 1932 pamphlet called ‘Can we afford to work?’, Wigforss argued such a policy:

            … leads to a fantastic conclusion that work is a luxury, that jobs for all is something which rich societies can afford, but which is well beyond the means of a poor country like Sweden…In the face of growing unemployment our citizens are bidden to tell each other, with concern but also resignation: we are too poor to be able to work. And the poorer we become, the less we can afford to work. No society still in command of its common sense could satisfy itself with economic wisdom of this lunatic kind. If incomes fall, if poverty grows, it quite obviously means that we are not working as much as before, that we are not maintaining our productive activity, and the immediate task must be to create jobs and expand production
            (Higgins, 1985:113). Winton Higgins – The 1930’s depression: are there lessons from history?’

            Wigforss confounded his liberal opponents, and the economic orthodoxy of his day, by reminding Swedes of the real economy in a 1934 speech:

            “Whatever we, by our own efforts, can produce in this country determines the standard of living of the Swedish people. However much food our agriculture yields, that is how much we can afford to eat. It is not extravagance and not unsound economics. However fine the dwellings we can build with our own materials and our own hands, these are the dwellings we can afford to move into. We can afford to consume the quantity of clothing, footwear, furniture and household items, roads, bridges, railways and telephones and gramophones and radio installations, cinemas and theatres and concert halls, schools and research institutes, meeting halls and sports grounds, as much of whatever belongs to life’s necessities, comforts or luxuries, as we ourselves can produce. And it is madness to suggest otherwise.”
            (Higgins, 1985). Winton Higgins – The 1930’s depression: are there lessons from history?’

            Wigforss worked hard to convince his party to make the pursuit of full employment its first priority, and then to form alliances with the agrarian parties and other groups, forming a broad front that kept the social democrats in office, and maintained full employment, for decades.
            ************
            Ernst Wigforss: ”Om målet med samhällsutvecklingen skulle vara att vi alla skulle arbeta maximalt voro vi sinnessjuka. Målet är att frigöra människan till att skapa maximalt. Dansa. Måla. Sjunga. Ja, vad ni vill. Frihet.”

            “If the goal for society’s evolvement where that we all should work at maximum we would be insane. The goal is to liberate man to be maximum creative. Dance, paint, sing. Yes whatever you want. Freedom.”
            ***********
            http://www.folkrorelser.org/rorelsemapp/dokument/wigforss.html
            Afford to work in Swedish

            1. Calgacus

              Yes, that billyblog was where I first heard of it from Victor Quirk and your comments there.

              Thank you very much for the link, will read it with google. I searched a while but couldn’t find anything. They seem to have the cover for the book only on the wigforss.org site. Wigforss and the quote from Keynes’s letter to Shaw are the best antidote I have found to a completely bizarre but exceedingly common view. Nobody has Wigforss/Keynes common sense any more! – not even many MMT fans who don’t really understand MMT.

  5. digi_owl

    The workers left could see this coming, and is why Norway gave the “surprising” no to joining at the very even of the group signing of the Nordics.

    The EU project was pretty much sold to the social left as a kumbaya moment by the financial right. But the workers left could see the future problems, and has lately found themselves bedfellows with the nationalist right (who they were at war with in the 1930s). This because the nationalist right see EU as trampling national sovereignty.

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