LONDON (Reuters Breakingviews) - “No man can lay down his right to save himself from death, wounds, and imprisonment”. It is highly doubtful that Carlos Ghosn was thinking about the words of Thomas Hobbes when he fled Japanese justice hidden in an audio equipment case. However, if the 17th century British philosopher was right, Ghosn could easily escape his non-prisoner’s dilemma.
LONDON (Reuters Breakingviews) - For aficionados of financial-political-economic crises, Greece’s near-exit from the euro zone in 2015 was a classic. Two journalists have told the story as a bureaucratic page-turner.
LONDON (Reuters Breakingviews) - Not that long ago, most economists condemned anything more than modest government borrowing in normal times. They mostly did not trust governments, and they had theories to show that official debts would squeeze out private investment, spur inflation and depress economic sentiment. Now, deficits are A-OK – and that's mostly good.
LONDON (Reuters Breakingviews) - Last week’s obituaries for Paul Volcker were effusive, lavishly praising the former chairman of the U.S. Federal Reserve for breaking inflation in the early 1980s and for criticising the behaviour of banks after the 2009 recession. The enthusiasm may be excessive.
LONDON (Reuters Breakingviews) - Do you believe in magic? That might be the right first question for whoever succeeds Mark Carney as governor of the Bank of England. The newly mandated government of Boris Johnson is expected to name a successor to the Canadian in the next few days. The list of possible candidates is extensive enough, but with no obvious frontrunner.
LONDON (Reuters Breakingviews) - “When those who depend on a company have a say in running it, that company generally does better and lasts longer.” With that explanation, the British Labour party’s election manifesto promised to reserve one-third of board seats for elected worker-directors. It’s one of the reasons that capitalists fret about Jeremy Corbyn’s party winning Thursday’s general election. If a new study of German companies is any guide, though, those fears are misplaced.
LONDON (Reuters Breakingviews) - Back in 2000, Bill Clinton mocked the Chinese government’s plan to keep the internet under political control, saying it was “sort of like trying to nail Jello to the wall.” The American president reasoned that the internet was hard to police. He was also expressing some conventional wisdom about development: that rapid growth naturally brought political freedoms, and that without those freedoms, growth would be short-lived.
LONDON (Reuters Breakingviews) - It may all make sense to Xi Jinping. For the Chinese leader, dissent, as seen in the Hong Kong protests, leads to disorder. Disorder could damage economic growth, undermine the government and end in disaster. The 19th century Taiping rebellion, as an extreme example, killed about 5% of the Chinese population. Thus, Xi might reason, firm repression is the only way forward.
LONDON (Reuters Breakingviews) - “What is common among a drought-affected farmer in India, a youth in Chicago’s South Side, and a fifty-something white man who was just laid off?” That question exemplifies the approach of “Good Economics for Hard Times: Better Answers to Our Biggest Problems”. Abhijit Banerjee and Esther Duflo, two of the three winners of this year’s Nobel Prize in Economics, like to think both big and small.
LONDON (Reuters Breakingviews) - It’s election time in the United Kingdom, and political parties are deeply split about most major issues. On the subject of government spending, however, there’s a surprising outbreak of consensus. Both the Conservatives and the Labour party have just announced similar fiscal frameworks. They are edging towards the new conventional wisdom among economists – government borrowing and spending can be good for national economic health.