sexta-feira, 30 de janeiro de 2015

European democracy enters dangerous times

Until last week European leaders thought their worst nightmare was that Syriza should triumph in the Greek general elections. Now that the leftwing populist party is in government, they worry instead about what will happen if it fails. Lain low by austerity politics, the two parties that held sway after Greece’s transition to democracy in 1974 have watched voters veer off to the left and right. If this trend spreads, it may threaten the European project itself.

The EU’s founding generation knew from bitter experience that democracy was a recent implant with a fragile record. As recently as 1921, the legal scholar James Bryce had written with surprise of “the universal acceptance of democracy as the normal and natural form of government”. But things had quickly gone awry. The European left was already ambivalent towards parliamentary politics, even before the Depression and the example set by Stalin’s USSR. The right, the great victor on the interwar continent, was a parade of strongmen, clerics and generals. The centre could not hold.

By 1939, most of the continent’s functioning democratic systems were in ruins, victims of a flight to the extremes. Weimar Germany, the most modern constitutional polity of its day, gave way to the Third Reich. Across eastern and southern Europe, the interwar transition to democracy was thrown into reverse as no fewer than 16 countries shifted right. Only after 1945 did parties on all sides slowly come to terms with the virtues of political moderation. This painstaking restoration of the centre ground was the precondition for democracy’s reconstruction.

History rarely repeats itself. Today’s far right talks the language of democracy, and its electoral strength may make that talk sincere, for now. That is small consolation. What it stands for could be more lethal to the EU than anything leftwing populists can unleash.

Though critical of the direction the EU has taken, parties such as Syriza and Spain’s Podemos remain staunchly Europeanist. Not so the forces of the right. Golden Dawn, a frankly Nazi party, held its vote steady in the Greek election, coming third, despite much of its leadership being behind bars. Politically, it is eurosceptic; economically, its vision is of fascism in one country.

The shaved heads of these muscle-bound hard men may not worry people outside Greece. But a shift rightward is under way elsewhere, too. In France, the disarray of the centre-right UMP has benefited Marine Le Pen’s National Front, which came top in last year’s European parliamentary elections. The Danish People’s party scored a similar victory. The picture is even bleaker because the polls do not show how the threat from the fringes influences parties of the centre-right itself. It is a phenomenon found right across the continent. In short, the battle to defend the continent’s shared currency is reviving a rightwing language of national purity, racism and independence.
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Syriza’s victory stood not for a repudiation of Europe, but for a redefinition of it. The moral reasoning that lay behind the Greek result began from a simple insight: economic trauma of the severity that Greece has suffered is destroying society. With youth unemployment above 50 per cent, an entire generation is being consigned to the scrap heap. At the same time, the notion of the common good is being sacrificed through forced sell-offs of state-owned lands as well as businesses, with the prospect of ecological destruction as a result. This view of austerity and its impact united classes and ages, town and country.

You can understand why people would take such a stance across debtor Europe — although this is apparently beyond the comprehension of much of the creditor north. Yet the lenders should take note, because this may be the last roll of the dice. It is tempting to write the Greeks off as irresponsible whingers and show them the door. Except that others may then follow them out of the euro, or even out of the EU itself, leaving Europe somewhere close to where it was when the entire integration project began more than half a century ago.

This time, things will be worse. Worse in part because institutionalised co-operation is needed more than ever, now that globalisation has forced peoples together and the room for going it alone has vanished. Worse, too, because half a century ago people had a vivid memory of what fascism can lead to, whereas now we seem to have forgotten.

If the Greek vote was for solidarity, it displayed a virtue that too much of the continent has lost sight of. German or Finnish voters may feel they have shown enough solidarity with the Greeks. But strictly speaking they have mostly shown solidarity with their own financial institutions — which would have been among the biggest losers if Greece had not been bailed out — and that is another thing entirely.

What is the moral vision the creditor nations propose? Frugality is not a policy. And if finance is to serve Europe rather than run it, a notion of the common good needs to be restored. The alternative is an increasingly fractious continent. What Europe risks if it does not change course is the further erosion of the political centre and the rise of rightwing extremism — and perhaps the disintegration of the union itself.

Mark Mazower is professor of history at Columbia and author of ‘Governing the World: The History of an Idea’

Fonte: FT

quinta-feira, 29 de janeiro de 2015

The stand-off that may sink the euro

The euro has become the prisoner of a playground game of “you-go-first”. Everyone — almost — knows what needs to be done, even if some resile from admitting it. The necessary ingredients are growth, competitiveness and sustainable debt and deficits. The missing glue is trust.

Governments will act only if they are sure those on the other side of the creditor/debtor line will do the same. As in the school playground, each insists the other must jump first. The result is policy paralysis and the rise of populism.

A sensible European policy maker would see the election success of Greece’s Syriza as a wake-up call rather than a nightmare. Not because the radical leftist government of Alexis Tsipras is correct in most of its prescriptions (though neither is it invariably wrong), but because its victory crystallises the impasse that hascrippled the eurozone.

Not so long ago governments confounded the gloomsters by summoning up the political will needed to keep the single currency on the road. Compromises were made on all sides. Berlin, though it could never say so, abandoned its opposition to bailouts; the peripheral economies accepted a harsh mix of austerity and structural reforms.

Resuscitating the euro is one thing; rejuvenating it is proving a lot tougher. The passing of the immediate crisis has sapped the will to act. Mario Draghi, the president of the European Central Bank, has been heroic in his efforts to buy time, most recently through pumping even more cheap money into the eurozone economy. In national capitals, though, resolve has curdled into mutual resentments. Syriza represents a collision between austerity and democracy. This may be the first of many.

In some respects, Greece is sui generis. You do not have to be a wild leftie to see that so large are its debts that they cannot be completely repaid and that never-ending austerity is not an answer. However it is dressed up — longer maturities, interest rate cuts or write-offs — Athens needs debt forgiveness. Pretending otherwise does nothing to advance the interests of creditors.

Greece’s problems, though, have always been as much political as economic. While others saw in the EU the opportunity to modernise, the ruling class in Athens simply pocketed the cash. Above all else, Greece needs half-honest government. The rest of the eurozone should be applauding Mr Tsipras’s promise to stamp out corruption and to collect more of the taxes.

Syriza goes wrong when it suggests that the route back to economic growth is to spend more on consumer subsidies and public sector workers. Clientelism and outright corruption has been the bane of Greek politics since the demise of colonels in 1974. Mr Tsipras too often sounds as if the far left now wants nothing more than to take its turn at distributing the spoils of office.

On the other side of the line, Germany’s Angela Merkel is not the pantomime villain of populist, and increasingly, popular myth. The chancellor is right when she says that the eurozone can survive long term only if weak economies improve their competitiveness, and rein in deficits and debts.

What grates is Berlin’s moralising tone. What deeply disappoints is the chancellor’s obsessive regard for short-term swings of domestic public opinion. Ms Merkel is Europe’s most powerful politician; domestically she has no rivals to speak of. She can afford to spend some of the capital accumulated over three successive election victories. Sometimes leaders have to make the political weather. She should look to Helmut Kohl, her predecessor-but-one.

Instead she combines tactical pragmatism with strategic myopia. Ms Merkel has said more than once that the failure of the euro would put in doubt the entire postwar European order. Given Russia’s armed aggression in Ukraine and its growing interference elsewhere in Europe, that would be a calamity beyond imagination. So, yes, the euro has a future only if weak governments get the economics right, but ratchet up the pressure too much and there will be no currency to save.

Greece should not be given a free pass, but the lesson of the post-crisis years has been that governments can go only so far in cutting budgets and improving competitiveness when their economies are shrinking and living standards are in free fall.

Austerity-driven growth was always a fraudulent prospectus. Now the populists threaten to make it impossible for debtors to embark on even calibrated fiscal retrenchment. Syriza’ s victory will embolden the far right as much as the far left, the xenophobic National Front in France as well as Spain’s leftist Podemos party. What will Ms Merkel say if enforced austerity and economic decline catapult Marine Le Pen into the Elysée Palace in a couple of years? The euro depends on political consent as well as fiscal discipline.

For its part, Greece must decide its future. Does it want to be a modern European democracy or would it prefer to rejoin the Balkans as another client of Vladimir Putin’s Russia ? It is not yet clear where Syriza stands on this though its apparent closeness to the Kremlin is not encouraging.

The bargain to guarantee a future for the euro has not changed since the start of the crisis: more growth-friendly structural reform in debt-burdened nations in return for an easing of the eurozone’s fiscal straitjacket by Germany and others. As for who should go first, well, that is easy: both.

Philip Stephens

Fonte: FT

quarta-feira, 28 de janeiro de 2015

A tipping point for Japan’s foreign policy

In Japan “I am Kenji” has replaced “I am Charlie” as the rallying cry of choice. The Kenji in question is Kenji Goto, a respected freelance journalist captured by militants from Islamic State of Iraq and the Levant (Isis) in Syria. On Saturday, a video was released of Mr Goto wearing a now all-too-familiar orange jump suit. He was holding up a photograph of what appeared to be the body of another Japanese hostage, Haruna Yukawa, who was almost certainly beheaded after Tokyo refused to pay a $200m ransom. Isis is demanding the release of an al-Qaeda militant being held in Jordan. If she is not freed, it has warned, Mr Goto will be the next to die.
Much more than the fate of Mr Goto hangs in the balance. Japan’s foreign policy, rooted in its pacifist constitution, stands at a tipping point. How the public reacts to the fate of Mr Goto could have a big influence on where things go from here.
Two related changes are under way. First Shinzo Abe, the conservative prime minister, is seeking to establish a more robust defence posture, one he has termed “proactive pacifism”. That doctrine has been used to justify everything from selling arms to allies — until recently strictly forbidden — to beefing up maritime defence around islands disputed with China. In particular, he wants to change a constitutional interpretation that bars Japan from helping allies if they come under attack. Ideally, he would also like to scrap article nine of Japan’s 1947 constitution, in which Tokyo forever renounces the right to wage war. In practice, that is likely to prove impossible because a strongly pacifist public would almost certainly reject such an amendment in an obligatory referendum.
Second, after years in which Tokyo sought to present itself as neutral on the world stage, Mr Abe is trying to nudge Japan towards taking a stand. Since the second world war, Japan has pursued what has been imaginatively called “omnidirectional diplomacy”. Crudely put, that has meant pretending to be everyone’s friend while pursuing its own economic interests. Meanwhile, the nasty business of defending Japan has been outsourced to the US.
Omnidirectional diplomacy has had its uses. In 1973, for example, faced with a ruinous oil embargo, Japanese diplomats distanced themselves from US support of Israel in the Yom Kippur war by presenting Tokyo as a friend to the Arab world. Oil flowed to Japan again. A decade ago, Tokyo played a similar card in Iran. By wooing Tehran, it won a concession to the huge Azadegan oilfield only for Washington to scupper the deal in the name of sanctions. The illusion of neutrality is becoming harder to pull off. Japan’s economic clout has waned, and geostrategic faultlines have widened with the rise of China and the 9/11 attacks on the US.
The hostage crisis could cut both ways for Mr Abe’s foreign policy ambitions. He will try to use the incident as evidence that Japan needs to stand up for itself more. Unlike many other nations, it has no commando unit ready to mount a rescue mission nor any constitutional leeway to take military action against foreign forces who seek to harm its nationals.
Yukio Okamoto, a defence expert and supporter of Mr Abe’s diplomatic agenda, says the kidnapping has exposed the Japanese public to the world’s uncomfortable realities. “We can no longer hide behind camouflaged neutrality,” he says.
Many in Japan will draw precisely the opposite conclusion. The incident, they will say, shows the perils of being sucked into foreign adventures. From the isolation and rarefied comfort of Japan, the rest of the world can seem like a blood-curdling place in which monotheistic religions vie for supremacy. Mr Abe has been criticised in parliament for offering $200m in humanitarian support to opponents of Isis. That, say critics, was a like a red rag to the fundamentalist bull.
“Many people are saying: ‘Why do we want to be America’s deputy sheriff? Do we really want to stick our necks out?’” says Jeff Kingston, a professor of international studies at Tokyo’s Temple University.
The outcome of the debate may well hinge on the fate of Mr Goto. Unlike the executed Yukawa, a fantasist who stumbled into the Middle East after claiming to be the reincarnation of a Manchu princess, Mr Goto elicits plenty of public sympathy. A humanitarian who has devoted much of his journalistic career to exposing the hardships of children in war zones, he went to Syria in a desperate attempt to rescue the hapless Yukawa. If he is released, as seemed possible on Wednesday, Mr Abe’s hand will be strengthened. His no-compromise diplomacy will be seen to have borne results, even if Mr Goto’s freedom is won through a Jordanian hostage exchange. If on the other hand, Mr Goto ends up dead, public support for foreign engagement could waver.
That could make it harder for Mr Abe to pass laws needed to bolster his constitutional reinterpretation. In the long run, however, any setback is likely to be temporary. The world is changing. China is pressing its territorial claims on Japan. The US is seen by many in Tokyo as an undependable ally, unlikely, if push comes to shove, to spill American blood in Japan’s defence. Meanwhile, the Middle East, on whose oil Japan remains dependent, has gone up in ideological flames. For Tokyo, the days of sitting on the fence are ending.

David Pilling

Fonte: FT

terça-feira, 27 de janeiro de 2015

Greek debt and a default of statesmanship

Sometimes the right thing to do is the wise thing. That is the case now for Greece. Done correctly, debt reduction would benefit Greece and the rest of the eurozone. It would create difficulties. But these would be smaller than those created by throwing Greece to the wolves. Unfortunately, reaching such an agreement may be impossible. That is why the belief that the eurozone crisis is over is mistaken.
Nobody can be surprised by the victory of Greece’s leftwing Syriza party. In the midst of a “recovery”, unemployment is reported at 26 per cent of the labour force and youth unemployment at over 50 per cent. Gross domestic product is also 26 per cent below its pre-crisis peak. But GDP is a particularly inappropriate measure of the fall in economic welfare in this case. The current account balance was minus 15 per cent of GDP in the third quarter of 2008, but has been in surplus since the second half of 2013. So spending by Greeks on goods and services has in fact fallen by at least 40 per cent.
Given this catastrophe, it is hardly surprising that the voters have rejected the previous government and the policies that, at the behest of the creditors, it — somewhat halfheartedly — pursued. As Alexis Tsipras, the new prime minister, has said, Europe is founded on the principle of democracy. The people of Greece have spoken. At the very least, the powers that be need to listen. Yet everything one hears suggests that demands for a new deal on debt and austerity will be rejected more or less out of hand. Fuelling that response is a large amount of self-righteous nonsense. Two moralistic propositions in particular get in the way of a reasonable reply to Greek demands.
The first proposition is that the Greeks borrowed the money and so are duty bound to pay it back, how ever much it costs them. This was very much the attitude that sustained debtors’ prisons.
The truth, however, is that creditors have a moral responsibility to lend wisely. If they fail to do due diligence on their borrowers, they deserve what is going to happen. In the case of Greece, the scale of the external deficits, in particular, were obvious. So, too, was the way the Greek state was run.

The second proposition is that, since the crisis hit, the rest of the eurozone has been extraordinarily generous to Greece. This, too, is false. True, the loans supplied by the eurozone and the International Monetary Fund amount to the huge sum of €226.7bn (about 125 per cent of GDP), which is roughly two-thirds of total public debt of 175 per cent of GDP.
But this went overwhelmingly not to benefiting Greeks but to avoiding the writedown of bad loans to the Greek government and Greek banks. Just 11 per cent of the loans directly financed government activities. Another 16 per cent went on interest payments. The rest went on capital operations of various kinds: the money came in and then flowed out again. A more honest policy would have been to bail lenders out directly. But this would have been too embarrassing.
Martin Wolf charts
As the Greeks point out, debt relief is normal. Germany, a serial defaulter on its domestic and external debt in the 20th century, has been a beneficiary. What cannot be paid will not be paid. The idea that the Greeks will run large fiscal surpluses for a generation, to pay back money creditor governments used to rescue private lenders from their folly is a delusion.
So what should be done? The choice is between the right, the convenient and the dangerous.
As Reza Moghadam, former head of the International Monetary Fund’s European department, argues: “Europe should offer substantial debt relief — halving Greece’s debt and halving the required fiscal balance — in exchange for reform.” This, he adds, would be consistent with debt substantially below 110 per cent of GDP, which eurozone ministers agreed to in 2012. But such reductions should not be done unconditionally.
The best approach was set out in the “heavily indebted poor countries” initiative of the IMF and the World Bank, which began in 1996. Under this, debt relief is granted only after the country meets precise criteria for reform. Such a programme would be of benefit to Greece, which needs political and economic modernisation.
Martin Wolf charts
The politically convenient approach is to continue to “extend and pretend”. Undoubtedly, there are ways of pushing off the day of reckoning still further. There are also ways of lowering the present value of interest and repayments without lowering the face value.
All this would allow the eurozone to avoid confronting the moral case for debt relief for other crisis-hit countries, notably Ireland. Yet such an approach cannot deliver the honest and transparent outcome that is sorely needed.
The dangerous approach is to push Greece towards default. This is likely to create a situation in which the European Central Bank would no longer feel able to operate as Greece’s central bank. That then would force an exit. The result for Greece would certainly be catastrophic in the short term.

My guess is that it would also reverse any move towards modernity for a generation. But the damage would not just be to Greece. It would show that monetary union in the eurozone is not irreversible but merely a hard exchange-rate peg.
That would be the worst of both worlds: the rigidity of pegs, without the credibility of a monetary union. In every future crisis, the question would be whether this was the “exit moment”. Chronic instability would be the result.
Creating the eurozone is the second-worst monetary idea its members are ever likely to have. Breaking it up is the worst. Yet that is where pushing Greece into exit might lead. The right course is to recognise the case for debt relief, conditional on achievement of verifiable reforms. Politicians will reject the idea. Statesmen will seize upon it. We will soon know which of the two they are.
Martin Wolf charts

Martin Wolf

Fonte: FT

segunda-feira, 26 de janeiro de 2015

Europe cannot agree to write off Greece’s debt

Syriza have won the Greek election. But, perhaps just as startling, the “far left” party is making considerable headway in the struggle to win over elite opinion in the west.

Many mainstream economists and policy makers are so alarmed by the state of the Greek economy that they have come to agree with Syriza’s argument that the only solution is to make a radical cut in Greece’s national debt, which stands at 175 per cent of gross domestic product.

Greece’s debt needs to be right-sized,” one senior anglophone policy maker told me in Davos. “And the Germans should remember they benefited from official debt relief in the 1950s.” Letters from Nobel Prize winners and several opinion pieces in this newspaper have made similar arguments.

Unfortunately, an explicit Greek debt write-off would cause more problems in Europe than it solved. Three main negative effects could be expected. First, it would cause a political backlash in northern Europe, which would strengthen far-right and nationalist parties. Second, far-left and anti-capitalist parties would gain credibility in southern Europe and would press for similar debt writedowns, as well as much expanded social spending — something that would lead to a collapse in market confidence. Third, the breakdown in trust between members of the EU that would follow a Greek default — even a negotiated default — would make it much harder to keep the EU together.

The focus on the unforgiving stance of Germany raises emotional issues about the second world war — but obscures the fact that almost all Greece’s European creditors take a similar view. It was very hard for politicians in countries such as Finland and the Netherlands to make the case for a bailout of Greece. Their sceptical citizens appeared to suspect that they might never be paid back. (Silly them!) If those fears are now vindicated, the nationalist parties that opposed the bailouts will benefit.

Alexander Stubb, the prime minister of Finland, points out that his country has lent Greece about €1bn — equivalent to just under 2 per cent of the government’s annual budget. To write off half that money in Finland — a country that has also suffered a deep recession — would be politically poisonous. The likely beneficiaries would be the nationalist True Finns party.
That pattern would be replicated elsewhere — with the National Front in France and the Freedom party in the Netherlands likely beneficiaries. Carl Bildt, a former prime minister of Sweden, gave a sense of the reaction in northern Europe, when he tweeted: “Syriza in Greece has won the election by promising that taxpayers in other euro countries will pay even more to them. Rather daring.”

The effects on the politics of Germany — the cornerstone of the EU — would also be noxious. The Alternative for Germany party (AfD), which has now added resentment of immigration to its opposition to the euro, would certainly make gains. One of Chancellor Angela Merkel’s biggest achievements has been to prevent the rise of a far-right party in Germany, similar to those in France, Austria and the Netherlands. That achievement is now in jeopardy.

Europe’s far-left is also cheering on Syriza. The idea that there is an easy way to repudiate debt and end austerity must be incredibly seductive for hard-pressed countries such as Spain, Portugal, Ireland and Italy. Parties including Podemos in Spain, Sinn Féin in Ireland and the Five-Star movement in Italy will gather support if Syriza succeeds in slashing Greek debt. But the prospect of debt-defaults across the eurozone — particularly in Italy or Spain — would then frighten the markets and increase the risk of yet another financial crisis. Everybody would suffer.

ven without a drift to the political extremes or a financial panic, a Greek default would do serious damage. The EU can really only operate if all its members believe that the other countries will respect their financial commitments to each other and obey European law. Once that idea is conclusively undermined, it will become almost impossible to negotiate future agreements. How would you persuade a German or Finnish parliament ever to vote through another European bailout? And how are cherished ideas — such as a banking union — expected to make progress if mutual trust evaporates?

All that does not mean that Greece must simply continue to suffer. Although the overall size of Greek debt is intimidatingly large, there are things that can be done — short of an outright default. The amount of interest that Greece pays on its debt has already been cut and deferred. This policy of “extend and pretend” could be elaborated to lighten the debt burden further. Debt repayments could be deferred until some sustained growth returns to the Greek economy. Combined with the European Central Bank’s radical monetary policies and lower oil prices that would help to restore growth in the Greek economy.

Of course, yet another messy EU compromise would be much less exciting than the debt write-off that Syriza has spoken of. But, given all the other dangers, dull compromise looks strangely appealing.

Gideon Rachman

Fonte: FT

sexta-feira, 23 de janeiro de 2015

O ultimo hurra do quercismo..

A atual administração ainda não completou o seu primeiro mês e já esta sendo vitima do fogo amigo pelo seu autodenominado flanco esquerdo. Em uma serie de entrevistas melancolicas em que o cerebro cedeu espaço ao figado, o ex assessor informal da Presidenta e lider  da conhecida escola de sociologia econômica da grande sp, a acusa de ter se rendido ao mercado. O motivo é, naturalmente  a escolha do Levy para a Fazenda e a serie de medidas adotadas pra colocar ordem na economia e garantir a continuidade da politica social que tem apresentado bons resultados na melhoria das  condiçōes de vida do andar de baixo.  

Ele se recusa em reconher o pessimo  resultado da experiencia inspirada  em idéias equivocadas  que ele ajudou a popularizar  junto a esquerda. Uma combinação exotica de marxismo bastardo com keynesianismo de orelhada  que no passado recente produziu um fracasso historico - o plano cruzado - que deveria ter colocado a famigerada escola na lata de lixo da hsitoria. Infelizmente, zumbis, são incapazes , quem sabe pela ausência de consciência, de aprender com os seus proprios erros.

Felizmente, a plateia cativa cativa deste ilustre representante do quercismo,  não é la grande coisa: restrita ao gatos pingados  que lhe fazem companhia nesta pobre opera bufa em que se tranformou a supra citada escola. As entrevista, pateticas e melancolicas, é o ultimo suspiro do que resta do quercismo. 

quinta-feira, 22 de janeiro de 2015

Gol de placa do Draghi..

Para surpresa dos pessimistas de plantão, Draghi anunciou um QE de 60 bilhōes mensais de euro ate Setembro de 2016. O mercado esperava, no cenario mais otimista, metate do valor anunciado. O preço, aparentemente, cobrado por alemães e holandeses, foi  transferir o risco de 80% dos ativos comprados para os bancos centrais nacionais. Dada a qualidade dos ativos a serem comprados, o risco   não é significativo e por isto a quebra da regra da mutualização não deverå comprometer o sucesso o do plano. No entanto, como o projeto europeu é fundamentalmente  um projeto politico,  a mutualização seria a opção que melhor expressaria  o compromisso da economia mais forte  do bloco com este projeto. Isto é ainda mais importante diante do risco da eleição grega levar a formação de um governo contrario as  medidas adotadas para retirar a Grecia do buraco.

É sem duvida,,uma grande vitoria do italiano e os estados nacionais ganham tempo para implementar as reformras estruturais, sem as quais é dificil  superar as dificuldades econômicas da zona do euro, com implicaçōes obvias sobre o futuro do projeto politico da integração europeia.

terça-feira, 20 de janeiro de 2015

Levy é o cara...

Finalmente um membro proeminente da comunidade desenvolvimentista reconheceu o fracaso da politica econômica heterodoxa da Dilma-Mantega-Arno. Achei curioso ele não ter incluido o Nelson Barbosa e o Holland na lista de pais da experiência desastrosa. No caso do primeiro o motivo é obvio: poupa-lo, já que é visto como a única voz heterodoxa na atual administração. Verdade que abandonou o barco assim que começou a afundar. O que - ca entre  nós - não é exatamente um bom cartão de visita. Já no caso do segundo , famoso pela entrevista-manifesto em que foi apresentada a nova matriz econômica, o esquecimento é mais um misterio que vem somar-se a outro mais antigo: o que ele fazia mesmo em Brasilia?  Cala te boca...

Barbosa é um bom economista, mas não podemos esquecer que ele sempre esteve ao lado do Mantega.  Ha quem argumente tratar-se de  uma dupla no estilo Pinky e o Cerebro, o que isentaria o primeiro de qualquer culpa no cartorio. Paralelo infeliz, já que neste  caso nenhum deles é o Pinky.

O fato é que o fracasso de mais uma aventura heterodoxa será pago por quem sempre pagou a conta: o andar de baixo. O andar de cima sempre  arruma um jeito de sair de fininho na hora de pagar a conta. Já os executores do tragico desastre poderão chorar as pitangas fazendo um pós doc em algum centro alternativo ou, melhor ainda, entrando para o circuito dos palestristas que fracassaram em Brasilia, mas são sucesso de publico.

A maioria dos heterodoxos ainda defende  a experiência desastrosa e  culpa a conspiração liderada pelos bancos e aliados neoliberais pelo abandono do barco desenvolvimentista. Ate ja posso ve-los choramingando e amaldiçoando o Levy nos inumeraveis eventos em que somentes eles participam.

Ainda aposto no sucesso do segundo mandato da Presidenta, ainda mais agora que ficou mais do que explicito seu apoio ao Levy. Sai a pos graduanda  por Campinas e entra a economista graduada pela federal gaucha.

quinta-feira, 15 de janeiro de 2015

SNB: once upon a time....

Em uma decisao, que pegou a todos de surpresa , o Bacen da Suiça  alterou a politica cambial,adotada em 2011, que fixava um teto para a moeda nacional em relação ao euro. A medida havia sido adotada pra  evitar que a alta demanda pelo franco suiço levasse a inevitavel valorização da sua moeda  com impacto negativo sobre o setor exportador e setor de serviços entre outros, alem de reduzir o risco de deflação. Diante da mais que provavel adoção do  quantitative easing pelo BCE, era dificil manter a politica, mas não se esperava que os suiços jogassem a toalha tão cedo.. O resultado foi o retorno ao cenario de 2011 que demonstra mais uma vez a necessidade de maior coordenação entre  os Bancos Centrais para evitar o salva se quem puder que sabemos não ser do interesse de ninguem.

Resta esperar como sera o cenario nesta sexta feira. Os setores atingidos não estão nenhum um pouco felizes e é de se esperar algum tipo de pressão na defesa dos seus interesses. Ainda é cedo pra especular qual tipo de medidas podera ser adotada, mas  é certo que este não  o fim do jogo. Muito pelo contráio: ele apenas começou.

quarta-feira, 14 de janeiro de 2015

Levy, Dilma e Davos,,,

Como mencionado no post de ontem, Levy tornou-se o centro das atenções da midia, com destaque para o valor econômico - que não cansa de encontrar um jeito de elogia-lo. Na edicão de hoje Bacha reconhece a obviedade: a ortodoxia do Levy.  Nåo é nenhum um pouco surpreendente, se lembrarmos que o Bacha é autor de importante manual de macroeconomia kaleckiana. Isto mesmo: ele já foi um heterodoxo, mas sempre um bom economista. Verdade seja dita, Bacha  não tem nada de ortodoxo e por isto sua declaração nåo é nada surpreendente.

Dilma, para horror de alguns amigos tucanos, trocou Davos pela posse do Evo Morales. Decisão sensata, já que a presença  da equipe econômica é mais do que suficiente.  Alem disto, a presença da Presidenta  poderia ser usada para criar situações propicias a falsas saias  justas  por parte de quem não esta nenhum pouco preocupado com o interesse nacional.

terça-feira, 13 de janeiro de 2015

A political star is born...

Neste calor insuportavel que lembra os verōes da minha infância no vilarejo de Juritis- macuco paramos intimos - no município de Glicerio na noroeste paulista, acompanhar o debate econômico não é nada fácil. Mas, o dever me chama e o exemplar do Valor me espera no jardim. Antes do dever o prazer: ler o Financial Times e dar uma olhada na Reuters.  Dou uma olhada rapida na Folha e no uol e leio um ou outro colunista. Felizmente substitui a Folha pelo Valor como minha leitura diaria. Minha pressão agradece.

Como é de praxe, antes do carnaval, o ano não começa realmente pra valer nos tristes trópicos. Exceto, naturalmente pra quem não se interessa pela festa do rei momo. Este parece ser o caso do Levy, que apesar de ser carioca, começou a trabalhar na vespera.  Talvez por isto mesmo tenha demonstrado uma grande habilidade em ocupar espaços onde menos se imagina. Ele é hoje  sem duvida alguma um politico notavel e quem estava apostando em uma passagem curta dele  pela corte ē melhor refazer as apostas.

segunda-feira, 12 de janeiro de 2015

Cortina rasgada...

O ataque terrorista na França acabou se tornando uma opoturnidade pra separar o joio do trigo na esquerda brasileira. Pra surpresa de alguns, varias vagas sagradas recorreram ao velho argumento da libertinagem de expressão para criticar  o comportamento da  Charlie Hebdo. Antes, obviamente, criticaram o ataque, seguido do famoso  " mas", que acaba por  imputar às vitimas a responsabilidade pelo ocorrido. Afinal, argumentam,  eram ataques eivados de islamofobia. Outros, mais toscos, adotaram a linha  quem brinca com fogo, acaba se queimando. Um conhecido jornalista recorreu a sua ilimitada critatividade - pra não usar outra palavra - pra argumentar  que não se trata de um ataque a liberdade de empressão: apenas um ataque terrorista.

Naturalmente, aqui e acola, aparece a inevitável critica ao cristianismo(cruzadas)- esquecendo que vários cristãos, juntamente com islamicos  são vitimas dessa minoria de islamicos radicais. Não esqueceram, obviamente de Israel: outro saco de pancadas preferido desta turma.  Todos são culpados pelo ato terrorista, exceto quem os praticou  e/ou ajudou na logistica necessaria. Afinal eles são vitimas do imperialismo e estão simplesmente fazendo o ajuste de contas de anos de exploração do periodo colonial.  E a velha lenga, lenga  que pega um fato historico verdadeiro - no caso o vergonhoso colonialismo - para justificar uma atrocidade no presente. É um desrespeito a maioria esmagadora dos islamicos que não apoiam este tipo de ato violento.

sexta-feira, 9 de janeiro de 2015

Self-correction depression and virtue of deflation

oes the Federal Reserve even have history as a guide? The world’s most powerful central bank has said it wants to raise interest rates this year, after six years in which they stuck at zero.
We know why it wants to do this. Many fear that monetary policy since the 2008 Lehman crisis has distorted markets and the economy. These were measures for exceptional circumstances, and it naturally wants to return to normal.
But investors are desperate for rates to stay on the floor, and take any evidence that rate rises will be postponed as an excuse to buy stocks.
Three times in three months world stocks have sold off but rebounded on a cue from the Fed.
In October, a near-10 per cent correction ended when James Bullard of the St Louis Fed said the Fed’s “QE” bond purchases, designed to keep rates low, might be continued. In December, after a 5 per cent correction, the announcement by the Fed at its regular meeting that it would be “patient” in waiting for rates to rise triggered another rebound. And this week, after the new year had started with another sell-off, the publication of the minutes from that meeting, which appeared to rule out a rate rise as soon as April, again prompted a rebound.
The picture of a market still desperate for easy money, and jumpy about the prospect of any increase in rates, is deeply disquieting.
But the stock market should not be a prime concern for the Fed, which is mandated to control inflation and promote full employment. On that basis, inflation is very low, and falling, and the Fed has made clear that it wants to avert outright deflation – which theoretically deters consumers from buying, as goods can later be bought for less money.
Low inflation is in large part due to falling oil prices, which the Fed calls “transitory”. But there is more to this deflation scare than that. The bond market’s forecast for inflation in five years is also tumbling, while the eurozone – which lapsed into deflation according to official data this week – had seen gathering fears of deflation for many months.
Then there is unemployment. The latest data, for December, show the jobless rate down to 5.6 per cent, its lowest since before Lehman. After each of the three previous US recessions, the Fed raised rates by the time unemployment hit this level. But it is not as clear as that. Annual earnings growth – much watched – slumped to 1.7 per cent, showing an absence of inflationary pressure, (and a lack of any reason for Main Street to cheer). The proportion of Americans looking for work returned to an all-time low.

Problematic history

So data can be found to back almost any move on rates. That suggests looking to history. But even that is problematic. History can be used and abused; different precedents have different implications.
Take two excellent books recently published – Hall of Mirrors by Barry Eichengreen (reviewed in the Life & Arts section), and The Forgotten Depression by James Grant. The former covers the Great Depression that started in 1929; the latter covers the previous depression of 1921. One suggests rates should stay put, the other that they should rise. 
Mr Eichengreen looks at the Great Depression and says that the main lessons were learnt.
Interest rates were cut, stimulus spending filled the gap, banks were recapitalised, and as a result the Lehman crisis led only to a Great Recession, rather than another depression.
Hourly rates
He suggests that the Fed should avoid the mistake it made in 1937, when it raised rates prematurely and sparked a fresh slump. Until it is clear that labour force participation and earnings are rising, he says, rate rises would not be worth the risk.
The implications of the 1921 episode covered by Mr Grant are the exact opposite. This depression, he argues, “corrected itself”.
Following a brief postwar inflationary boom, prices were allowed to fall – almost exactly as far as they did at the outset of the Great Depression – as were wages. After a brutal dose of unemployment, growth resumed within 18 months. The Roaring Twenties ensued.
Deflation was the market mechanism that allowed the economy to find an ignition point. Meanwhile, when the next depression hit officials tried to ensure that wages did not fall – an intervention that forced up unemployment. On that reading, higher rates would bring good discipline and deflation is nothing to fear.
What is clear? Perhaps two things. First, central banking is difficult. And second, this is too uncertain for investors to take on new risks.

quinta-feira, 8 de janeiro de 2015

The gunmen in Paris attacked more than a Muslim-baiting magazine

rançois Hollande, France’s president, rightly called it “an act of exceptional barbarity . . . against freedom of expression”. But the murder on Wednesday of 12 people at the Paris offices of Charlie Hebdo, a satirical magazine, will not surprise anyone familiar with the rising tensions among France’s 5m or more Muslim citizens and the poisonous legacy of French colonialism in north Africa.
For now, the perpetrators are unidentified. We need to keep in mind that the worst terrorist outrage in Europe of recent years, the murder of 77 people in Norway in 2011, was committed not by Islamist militants but by a far-right fanatic, Anders Behring Breivik.
Like other politically motivated attacks, from 9/11 to the killing last May of four people at the Jewish museum in Brussels, the atrocity at Charlie Hebdo was despicable and indefensible. Among the first to condemn it was the French Council of the Muslim Faith, which termed it “a barbaric act against democracy and freedom of the press”.
Charlie Hebdo is a bastion of the French tradition of hard-hitting satire. It has a long record of mocking, baiting and needling Muslims. Two years ago the magazine published a 65-page strip cartoon book portraying the Prophet’s life. And this week it gave special coverage to Soumission (“Submission”), a new novel by Michel Houellebecq, the idiosyncratic author, which depicts France in the grip of an Islamic regime led by a Muslim president.
This is not in the slightest to condone the murderers, who must be caught and punished, or to suggest that freedom of expression should not extend to satirical portrayals of religion. It is merely to say that some common sense would be useful at publications such as Charlie Hebdo, and Denmark’s Jyllands-Posten, which purport to strike a blow for freedom when they provoke Muslims.
Emotions are understandably high in France, where the next question is what impact Wednesday’s murders will have on the political climate, and in particular the fortunes of Marine Le Pen and her far-right National Front. Anti-Islamism is part of the electoral attraction of a party that topped the polls in May in France’s European Parliament elections.
Ms Le Pen has taken care to distance her party from the anti-Semitism that stained it and limited its appeal under her father, Jean-Marie Le Pen. But she has left anti-Islamism in place and even reinforced it.
In 2010 Ms Le Pen compared Muslims praying in the streets to the 1940-44 Nazi occupation of France. Less than 18 months later she collected 17.9 per cent of the vote in France’s presidential election. She has a good chance of increasing her share of the vote enough to win the first round — though not the second, decisive round — of the 2017 election.
Anti-Islamism and a hard line on immigration will shore up Ms Le Pen’s core vote, but they will not unlock the doors of the Elysée Palace. Surveys show that a majority of French people rejects racism and dislikes extremism.
The English author Andrew Hussey, who lives in Paris, published a book last year called The French Intifada, in which he described France as “the world capital of liberty, equality and fraternity . . . under attack from the angry and dispossessed heirs to the French colonial project”. 
The murders in Paris throw down a challenge to French politicians and citizens to stand up for the republic’s core values and defeat political violence without succumbing to the siren songs of the far right.
This article is an expanded and updated version of an earlier blog posted on January 7

terça-feira, 6 de janeiro de 2015

Martin Wolf: An economist's advice to astrologers

As the late John Kenneth Galbraith remarked: “The only function of economic forecasting is to make astrology look respectable.”
But that does not mean we can say nothing useful. One can at least identify economic trends and a few known unknowns
The world economy is extremely likely to grow. It has, after all, grown every year since the second world war, with the sole exception of 2009, the year of the global financial crisis, when it shrank 2 per cent at market exchange rates and remained roughly constant at purchasing power parity. The International Monetary Fund believes the world economy will grow at nearly 4 per cent, at PPP. This is a good starting point. It is also a remarkable one: at 4 per cent annual growth, the world economy doubles every 18 years.
We can also be fairly sure emerging economies will grow faster than high-income ones and Asian emerging economies — those of east Asia and south Asia — will grow fastest of all. This, too, has been a long-term pattern.
Asian emerging economies have grown faster than emerging economies as a whole in every year at least since 1980, even (though only just) in 1998, the worst year of the Asian financial crisis. Asian growth is decelerating, largely because of China’s slowdown. But it is still expected to run at an annual rate of above 6 per cent.
Emerging economies as a whole are forecast to grow at close to 5 per cent annually. Meanwhile high-income economies are expected to grow at a little over 2 per cent. The main reason emerging economies grow faster than the high-income ones is catch-up: the possibility of applying already existing knowledge. This potential is nowhere near exhausted. Barring some sort of catastrophe, this is likely to continue being the strongest force working on the world economy for many decades.
Among the high-income economies, it is also sensible to bet that the US will grow faster than Europe and Japan in any given year. This is partly because of its better demography and partly because of a faster technical progress.
How far, then, can we go beyond this to assess 2015 specifically?
Start with the possible positives.
Martin Wolf 1
Short-term forecasting always focuses on demand. But it is sensible to include supply. Economies with exceptional amounts of slack can grow faster than normal. Among high-income economies, those with most slack are those in the “peripheral” eurozone. These economies could now grow relatively quickly.
The improvement might even start in 2015, since long-term interest rates are low, private sector balance sheets are stronger and fiscal deficits are under control. If the European Central Bank pulled out all the stops, the rise in confidence might surprise.
Another positive supply shock would be a recovery in productivity growth in crisis-hit high-income economies, including the UK and US. That would only be a small surprise. A positive supply surprise might also be seen in India, which ought to be the world’s fastest-growing major economy over the next two or three decades.
Another helpful factor is persistently low inflation. This allows the monetary authorities to remain accommodative. Tightening in the US and UK is likely to be slow. In the eurozone and Japan, policy is even going in the opposite direction, since deflation fears remain strong. China is being driven to loosen, too, as its economy weakens.
The most important positive factor of all is the decline in oil prices. An interesting blog for the IMF argues that global output could be between 0.3 per cent and 0.7 per cent higher in 2015 as a result. Lower oil prices help by reducing headline inflation and raising real incomes of consumers. If prices remain low, this benefit could last for a while.
Martin Wolf 2
Now consider possible negatives. Experience suggests that a large financial crisis is the economic event most likely to disrupt global growth. The obvious risks would seem to be a financial meltdown in China, a collapse of the eurozone, or a severe crisis in emerging economies as the dollar strengthens, US interest rates rise and capital flees. Any of these seems conceivable.
But none seems that likely, largely because policy makers in all of these cases are likely to be able to manage the risks. The greatest danger would seem to be disintegration of the eurozone. This is a political project whose political underpinnings are fragile. Survival is likely. But it is not certain.
Another possible source of severe disruption would be a geopolitical shock. But it would have to be a large one. The Yom Kippur war of 1973 and Iraq’s attack on Iran in 1980 were closely associated with disruptive oil shocks. Yet more recent terrorist attacks have done no significant damage to the global economy. Conflict between great powers, a nuclear war in the Gulf or nuclear terrorism would be game changers. But direct conflict between great powers has not occurred since the Korean war. The economic results of proxy wars proved manageable during the cold war. One has to hope the same is true of the new cold war between Russia and the west.
Another year of quite decent global growth is, in brief, far and away the most likely outcome in 2015. It could even be a relatively good year, notably in the US. But — and this is a big but — deep structural challenges remain.
Martin Wolf 3
In particular, we continue to rely on central banks to manage what I have labelled “chronic demand deficiency syndrome”. The ultra-low interest rate environment is its most telling symptom. As China’s extraordinarily high investment rate falls, the demand deficiency is likely to worsen. Germany’s demand deficiency makes resolution of the eurozone crisis very difficult.
But central banks should be able to cope for another year. Happy New Year.

segunda-feira, 5 de janeiro de 2015


O segundo governo Dilma começou com uma bronca totalmente desnecessaria ao Ministro do Planejamento. Ele errou ao falar de um tema delicado, aparentemnte, sem combinar com a Presidenta. Um reprimenda entre quatro  paredes teria sido a melhor opção. O piti transformou em manchete o que seria esquecido rapidamente pela midia. Pior: ao obriga-lo a soltar um desmentido, sinalizou que ela não tem muita confiança não somente nele, mas em toda a equipe economica. Erro elementar de politica. Mais um na longa lista que promete ser mais longa que a do primeiro mandato.

Levy se  saiu bem na posse: demonstrou  ser um funcionario publico exemplar. Já a Abreu, depois da deliciosa entrevista a Folha,  aumentou, sem sombra  de duvida o numero de amigos à direita e inimigos à esquerdan. Ela promete ser uma das grandes atrações do segundo mandato. Uma comediante de grande talento. Ao que consta o talento é ainda maior como empresaria. Se fracassar nesta ultima - o que duvido - ja tem como ganhar a vida...

Divertida, pra não usar outra palavra a declaração do novo secretario paulista sobre a seca: o unico plano dele é esperar por mais chuvas que a media do verão. Outro comediante..