{"id":4813,"date":"2012-05-24T09:24:31","date_gmt":"2012-05-24T13:24:31","guid":{"rendered":"http:\/\/www.multiplier-effect.org\/?p=4813"},"modified":"2012-05-24T09:24:31","modified_gmt":"2012-05-24T13:24:31","slug":"hows-that-make-people-poorer-strategy-working-out","status":"publish","type":"post","link":"https:\/\/blogs.bard.edu\/multiplier-effect\/hows-that-make-people-poorer-strategy-working-out\/","title":{"rendered":"How&#8217;s That &#8220;Make People Poorer&#8221; Strategy Working Out?"},"content":{"rendered":"<p>There is no shortage of viable <em>economic<\/em> solutions for the eurozone.\u00a0 But as Martin Wolf points out in his <a href=\"http:\/\/www.ft.com\/intl\/cms\/s\/0\/7c3606ec-a34c-11e1-8f34-00144feabdc0.html#axzz1vipVl1e4\"><em>FT<\/em><\/a> column, once you strike all of the solutions that have been declared politically unacceptable (eurobonds, a stronger EU-level fiscal authority), there aren&#8217;t too many policy levers left to pull.\u00a0 One possibility Wolf mentions is to encourage faster adjustment within the eurozone by allowing higher inflation in the core (Germany) than in the periphery\u2014but Germany is unlikely to accept that either.<\/p>\n<p>Instead, we&#8217;re left with trying to achieve adjustment through internal devaluation (declining wages in the periphery).\u00a0 How&#8217;s that going?\u00a0 C. J. Polychroniou checks in on the progress in his latest one-pager:<\/p>\n<blockquote><p>The \u201cinternal devaluation\u201d policy pursued by Germany, the European Central Bank, and the European Commission can be summed up in a few words: great pain, no gain. The irony of this seems not to have escaped the attention of the Brussels bureaucrats: the Commission\u2019s spring economic forecast, released just a few days ago, observes that \u201cwages in the business sector have been falling in recent quarters but at a pace that was insufficient to help recover competitiveness.\u201d Still, the report injects a note of optimism by stating that \u201cthe recent labour market measures are expected to contribute to further significant reductions in labour costs over the next two years.\u201d<br \/>\n&#8230;<\/p>\n<p>The Commission also acknowledges that the \u201ccurrent-account deficit . . . remains at an unsustainable level.\u201d<\/p><\/blockquote>\n<p>Polychroniou also assesses what the emergence of Syriza means for the future of Greece and eurozone negotiations. <a href=\"http:\/\/www.levyinstitute.org\/pubs\/op_31.pdf\">Read it here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>There is no shortage of viable economic solutions for the eurozone.\u00a0 But as Martin Wolf points out in his FT column, once you strike all of the solutions that have been declared politically unacceptable (eurobonds, a stronger EU-level fiscal authority), there aren&#8217;t too many policy levers left to pull.\u00a0 One possibility Wolf mentions is to [&hellip;]<\/p>\n","protected":false},"author":202,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[238,94,39,311,297,276],"class_list":["post-4813","post","type-post","status-publish","format-standard","hentry","category-eurozone-crisis","tag-eurozone-crisis-2","tag-germany","tag-inflation","tag-internal-devaluation","tag-martin-wolf","tag-polychroniou"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/4813","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/users\/202"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/comments?post=4813"}],"version-history":[{"count":5,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/4813\/revisions"}],"predecessor-version":[{"id":4825,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/4813\/revisions\/4825"}],"wp:attachment":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/media?parent=4813"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/categories?post=4813"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/tags?post=4813"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}