• Market Irrationality in the Eurozone

    Markets can be irrational, as Keynes famously pointed out, and the Eurozone/Greek crisis is a classic example.  “The markets” for months have been demanding more blood from Greece, as the financial press has continuously and often unquestioningly reported: more commitment to spending cuts, tax increases, and “procyclical” policies that the bondholders, EU authorities, and the […]

  • The European Union’s Dangerous Game

    Perhaps the wild swings in financial and stock markets over the last week will make people give closer scrutiny to what is going on in Europe, which would be a good thing for the world.  According to most news reporting, markets are worried about a potential default by Greece on its sovereign debt, and the […]

  • Venezuela Is Not Greece

    With Venezuela’s economy having contracted last year (as did the vast majority of economies in the Western Hemisphere), the economy suffering from electricity shortages, and the value of domestic currency having recently fallen sharply in the parallel market, stories of Venezuela’s economic ruin are again making headlines. The Washington Post, in a news article that […]

  • Greece: Who Needs “Success Estonian Style”?

    As I have noted previously, Latvia has experienced the worst two-year economic downturn on record, losing more than 25 percent of GDP.  It is projected to shrink further during the first half of this year, before beginning a slow recovery, in which the International Monetary Fund (IMF) projects that it will not reach even its […]

  • Venezuela Needs an Economic Development Strategy

    Throughout Venezuela’s record-breaking economic expansion, the government’s opponents — which includes most of the international media as well as Washington — were “crying, waiting, hoping,” as the rock and roll legend Buddy Holly once sang.  The “oil bust” had to be just around the corner, they prayed and wrote.  But for five and a half […]

  • China Will Do Whatever It Wants to Do . . . about Its Currency and Iran

    The United States and China seem to have reached an agreement with regard to the exchange rate between their two currencies.  The agreement is that the U.S. government will stop yelling about it, and China will do whatever it wants to do, which will probably include some modest rise in the renminbi some time in […]

  • U.S. Fighting Losing Battles Against National Self-Determination

    Of all the misunderstandings that guide U.S. foreign policy — including foreign commercial policy — perhaps the most important and long-lasting is the failure to recognize or understand what national self-determination means to most people in the world.  Or why it might be important to them.  Our leaders seem to have learned very little since […]

  • PIIGS Countries, Being Led to the Slaughter, Should Rethink Euro

    As the EU summit meeting convenes, Greece is dominating the agenda much more than Germany’s Chancellor Angela Merkel had wanted.  This week she has thrown cold water on the idea that Germany and other EU countries would take responsibility for helping Greece to roll over some of its debt, handing that job off to the […]

  • Lula Shouldn’t Buckle to U.S. Pressure on Iran

    President Lula da Silva has come under fire from opponents lately for refusing to join the United States’ campaign for increased sanctions against Iran.  Washington recently switched from a brief phase of “engagement” with Iran over its nuclear program to the more aggressive posture of threats and confrontation that had been the strategy of the […]

  • U.S. Campaign to De-legitimize Venezuela’s Elections Has Begun

    Venezuela has an election for its National Assembly in September, and the campaign has begun in earnest.  I am referring to the international campaign.  This is carried out largely through the international media; although some will spill over into the Venezuelan media.  It involves many public officials, especially in the U.S.  The goal will be […]

  • Greenspan’s Nightmare

    Alan Greenspan had a dream, or rather a nightmare.  Greenspan seems to have woken up in a cold sweat one morning in fear that the period of “disinflationary pressures” that had kept inflation low since the 1990s was about to end.  This was 2007, when he published his autobiographical economic treatise, The Age of Turbulence. […]

  • How Wars Are Made

    In a visit to Qatar and Saudi Arabia this week, Hillary Clinton said that Iran “is moving toward a military dictatorship” and continued the Administration’s campaign for tougher sanctions against that country. What could America’s top diplomat hope to accomplish with this kind of inflammatory rhetoric?  It seems unlikely that the goal was to support […]

  • Central Bank Independence: From Whom?

    The President of Argentina, Cristina Fernández, recently fired the head of the central bank, Martín Redrado, when he rejected the government’s plan to use $6.6 billion of international reserves to pay off debt. The domestic and international press response was overwhelmingly negative, with complaints that this would “kill central bank independence.” Leaving aside the question […]

  • Latvia’s Recession: The Cost of Adjustment with an “Internal Devaluation”

    Executive Summary: The Latvian recession, which is now more than two years old, has seen a world-historical drop in GDP of more than 25 percent.  The IMF projects another 4 percent drop this year, and predicts that the total loss of output from peak to bottom will reach 30 percent.  This would make Latvia’s loss […]

  • Why Washington Cares about Countries like Haiti and Honduras

    When I write about U.S. foreign policy in places like Haiti or Honduras, I often get responses from people who find it difficult to believe that the U.S. government would care enough about these countries to try and control or topple their governments.  These are small, poor countries with little in the way of resources […]

  • Haiti: Another U.S. Military Occupation

    On Monday, six days after the earthquake in Haiti, the U.S. Southern Command finally began to drop bottled water and food (MREs) from an Air Force C-17.  U.S. Defense Secretary Robert Gates had previously rejected such a method because of “security concerns.” The Guardian reports that people are dying of thirst.  And if they do […]

  • Latvia Shows the Damage That Far-Right Economic Policy Can Do — with Support from the European Union and IMF

    The signs of recession are more noticeable to those who live here — restaurants and coffee shops have lost most of their customers, and construction has practically ground to a halt.  Emigration has soared. Latvia has set a world-historical record by losing more than 24 percent of its economy in just two years.  The International […]

  • Media Battles in Latin America Not about “Free Speech”

    For at least a month now in Ecuador there has been a battle over regulation of the media.  It has been in the front pages of the newspapers most of the time, and a leading daily, El Comercio, referred to the fight as one for “defense of human rights and the free practice of journalism.” […]

  • Are Shorter Work Hours Good for the Environment?  A Comparison of U.S. and European Energy Consumption

    Variation in Work Hours among Countries It is well known that Europe lags behind the United States in terms of GDP per capita.  However, it is less well known that European workers in a number of countries are nearly as productive, and in some cases more productive, than their American counterparts.  As seen in Table […]

  • Top Ten Ways You Can Tell Which Side the United States Government Is on with Regard to the Military Coup in Honduras

    At dawn on June 28, the Honduran military abducted President Manuel Zelaya at gunpoint and flew him out of the country.  Conflicting and ambiguous statements from the Obama administration left many confused about whether it opposed this coup or was really trying to help it succeed.  Here are the top ten indicators (with apologies to […]