2009 is an important year for the European political process. In addition to the Lisbon II referendum, we also have European Parliament elections. Michael Marsh of TCD and Simon Hix of LSE will be providing regular forecasts of the likely electoral outcome, with the first set of predictions released today.
The Irish forecast is here.
The full forecast is here.
The FT has a nice piece on Germany’s economic problems today. As Martin Wolf keeps pointing out, the reliance of countries like Germany and China on heavily-indebted consumers elsewhere is one of the root causes of the crisis that will have to be solved sooner or later.
With an announcement coming from the government on Tuesday, I think the best that can be hoped for at this point concerning our banking problems is some sort of “kicking to touch” in which the Minister announces that further time is being taken to consider the available options. If this is indeed the case, then we are going to need a much better-informed debate about these options over the next few weeks than has been served up in recent months by the Irish media.
There are a number of possible ways that the government can solve the problems with our leading banks. However, the various plans being discussed differ greatly in terms of (a) How the losses associated with bad property loans are allocated between the taxpayer and bank shareholders and (b) Who owns and controls the cleaned-up banks. If the media were serving the public well, there would have been an extensive discussion of these issues. Unfortunately, this has not been the case.
As an example, consider today’s column in the Irish Times by John McManus. Note that my point here is not to pick on McManus, who I consider to be an excellent journalist often willing to be tough on the government on business issues, but to illustrate the weakness of the coverage from even our leading journalists.
Barry Eichengreen and I have a short piece on Vox comparing the two global depressions that began in 1929 and 2008. Hopefully this one will not last as long as the one 80 years ago.
As signalled by Eurointelligence, the FT carries this story today about how Germany is creating new products to target retail investors for its sovereign debt.