Are we in 1936 or 1812?
by Jean Pisani-Ferry on 19 July 2010
Download: French
Category: OPINION PIECES AND COLUMNS
Topics: Budgetary and monetary policies, Currencies and International finance
Bruegel Director Jean Pisani-Ferry analysis the current economic climate through a historical lens. He draws parallels to the year 1937 when the tough fiscal policy of the US federal government sharply cut GDP growth and resulted in a dramatic increase in unemployment. The current debt crisis also has echoes from past from the chain of sovereign defaults between the Napoleonic wars in the eighteenth and nineteenth centuries.
The author explains why the the planned fiscal tightening in 2011 is financially inevitable, but economically risky. [Download in French]
Fiscal federalism in crisis: lessons for Europe from the US
by Zsolt Darvas on 12 July 2010
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Category: POLICY CONTRIBUTIONS
Topics: Budgetary and monetary policies
Drawing comparisons between the fiscal architecture and situation in the US and the European Union, Bruegel Research Fellow Zsolt Darvas answers three questions in this Policy Contribution- Why has the euro been hit so hard? How would a more federal European fiscal union closer to the US model have helped? How do the euro area’s fiscal architecture reform plans stand up in light of the US example? He concludes that a higher level of fiscal federation is not inevitable for the viability of the euro area, but current European fiscal reform proposals carry political risk and their implementation could be deficient or lack credibility. Introduction of a Eurobond covering up to 60 percent of member states’ GDP would be a much more preferable solution.
Did you say federalism?
by Jean Pisani-Ferry on 07 July 2010
Category: OPINION PIECES AND COLUMNS
Topics: Budgetary and monetary policies
In this column, Bruegel Director Jean Pisani-Ferry asks whether a budgetary union can survive without budgetary federalism? Europe needs some form of solidarity in the face of adversity, a form of "federal insurance" but without the cumbersome nature of a federal budget or a permanent increase in transfers.
Against this context, he examines the options available to the European Union.
Why Germany fell out of love with Europe
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Category: ESSAYS AND LECTURES
Topics: Budgetary and monetary policies, European and global governance
This essay written by Bruegel Visiting Fellow Wolgang Proissl analyses the central role that Germany has and continues to play in the European Union. The author looks back at how Germany acted as a ‘benevolent hegemon’ through the adoption of the single currency and the creation of the European Monetary Union. Against this background, he examines the German response to the recent euro crisis, in particular the crucial weekend of May 8-9 2010. He asks if Germany is still willing to be the benevolent hegemon and save the euro from disintegration, or are the domestic implications of this role moving her away from Europe.
Germany’s super competitiveness: A helping hand from Eastern Europe
by Dalia Marin on 20 June 2010
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Category: OPINION PIECES AND COLUMNS
Topics: Budgetary and monetary policies, Currencies and International finance
Discussions about the current-account imbalance within the Eurozone have focused on the under-competitive periphery and super-competitive Germany. This column suggests that the argument ignores one powerful way that Germany lowered its relative unit labour costs. German firms offshored parts of their production to the new member states in Eastern Europe, Russia, and the Ukraine.