LONDON – Early last month, Andy Haldane, chief economist at the Bank of England, blamed “irrational behavior” for the failure of the BoE’s recent forecasting models. The failure to spot this irrationality had led policymakers to forecast that the British economy would slow in the wake of last June’s Brexit referendum. Instead, British consumers have … Continue reading Economists in Denial
Category: Journalism
Another Reset with Russia?
LONDON – The question of the West’s relationship with Russia has been buried by media stories of hacking, sex scandals, and potential blackmail. The dossier by former British spy Christopher Steele about US President Donald Trump’s activities in Moscow some years ago may turn out to be as credible as the claims that Saddam Hussein … Continue reading Another Reset with Russia?
Economists versus the Economy
LONDON – Let’s be honest: no one knows what is happening in the world economy today. Recovery from the collapse of 2008 has been unexpectedly slow. Are we on the road to full health or mired in “secular stagnation”? Is globalization coming or going? Policymakers don’t know what to do. They press the usual (and … Continue reading Economists versus the Economy
What would Keynes think of Brexit?
John Maynard Keynes would have been conflicted by the referendum. Culture pulled him towards Europe; politics and especially the continent’s current austerity economics would have pushed him increasingly away. Churchill talked about the “three majestic circles” of the Commonwealth, the United States and Europe. But over Keynes’s lifetime, the reality was that Britain was firmly … Continue reading What would Keynes think of Brexit?
Slouching Toward Trump
LONDON – The Republican establishment has gone into overdrive to present President-elect Donald Trump as a guarantor of continuity. Of course, he is nothing of the sort. He campaigned against the political establishment, and, as he told a pre-election rally, a victory for him would be a “Brexit plus, plus, plus.” With two political earthquakes … Continue reading Slouching Toward Trump
The Case for UK Import Substitution
LONDON – The most dramatic economic effect of the United Kingdom’s Brexit vote has been the collapse of sterling. Since June, the pound has fallen by 16% against a basket of currencies. Mervyn King, the previous governor of the Bank of England, hailed the lower exchange rate as a “welcome change.” Indeed, with Britain’s current-account … Continue reading The Case for UK Import Substitution
Helicopter Money Is in the Air
LONDON – Fiscal policy is edging back into fashion, after years, if not decades, in purdah. The reason is simple: the incomplete recovery from the global crash of 2008. Europe is the worst off in this regard: its GDP has hardly grown in the last four years, and GDP per capitais still less than it was … Continue reading Helicopter Money Is in the Air
The Scarecrow of National Debt
Most people are more worried by government debt than about taxation. “But it’s trillions” a friend of mine recently expostulated about the United Kingdom’s national debt. He exaggerated a bit: it is £1.7 trillion. But one website features a clock showing the debt growing at a rate of £5,170 per second. Although the tax take is far less, the … Continue reading The Scarecrow of National Debt
A tweak to helicopter money will help the economy take off
Theresa May, the UK prime minister, has all but repudiated the economic policies of the previous chancellor of the exchequer, George Osborne. She has promised an “industrial strategy to get the whole economy moving”. What form should a renovated economic strategy take? The immediate problem to overcome is the uncertainty engendered by the Brexit vote. … Continue reading A tweak to helicopter money will help the economy take off
The Failure of Free Migration
LONDON – The horrendous attack by a French-Tunisian man on a crowd in Nice celebrating Bastille Day, which killed 84 and injured hundreds more, will give National Front leader Marine Le Pen a massive boost in next spring’s presidential election. It doesn’t matter whether the murderer, Mohamed Lahouaiej-Bouhlel, had any links to radical Islamism. Throughout … Continue reading The Failure of Free Migration
Robert Skidelsky 