Reminder – Euro Crisis Roundtable, 4pm, Thursday

Euro Crisis Roundtable

Chair: Kevin O’Rourke, Chichele Professor of Economic History, University of Oxford

Speakers: Richard Portes, Hans-Werner Sinn, Alan Taylor

Date: Thursday, 18th April
Time: 4pm
Venue: The J M Synge Theatre, Room 2039, Ground Floor Arts Building, Trinity College Dublin

This is a jointly organised lecture by the IIIS and the Trinity Long Room Hub. This lecture series is an associated event of the Irish Presidency of the Council of the EU. The series will run from January to June. Admission is free and all are welcome.

A discussion of the future of the euro area with leading experts.  Hans-Werner Sinn is President of the CES-ifo Institute and one of Germany’s most prominent economists. Richard Portes is Professor at London Business School and President of the Centre for Economic Policy Research.  Alan Taylor is Professor of Economics at the University of Virginia and an expert in financial economics and economic history.

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14 thoughts on “Reminder – Euro Crisis Roundtable, 4pm, Thursday”

  1. The Beard of Hans Werner Sinn: A Consideration

    It is a difficult thing, posting on blogs: one never knows how much knowledge to assume in the reader or whether links are necessary. The irisheconomy.ie blog seems to hold up postings that have three or more links. So I will rely on the interested reader to look up any images or thoughts as they go and hope that the following is sufficiently clear to stand on its own otherwise.

    It is common knowledge that, particularly in America, people will not vote for a man with a beard. The beard of Sinn states immediately that he is not interested in elective power. Indeed, shows a certain contempt for those with smooth chops whose role is that of the seducer. Sinn is not a seducer. But this is not to say that the beard of Sinn shows a man uninterested in power: quite the reverse. But it is a particular kind of power.

    There is an ancient vase showing the Greek warriors Achilles and Ajax playing some game like chess. Actually it looks like they are feeding goldfish, but never mind. The beard of Ajax is somewhat shaggy. This prefigures the madness that is to come to him.

    The first thing we can say about the beard of Hans Werner Sinn is that it is not that kind of beard. It is not the beard of a madman or a mystic, he is not channelling a Tolstoy or a Dostoevsky. He is not the shaman in the wilderness. His beard is precise, deliberate. It is the beard of a man who has chosen to sculpt it in this manner. It needs to be maintained.

    Staying in the ancient world: it is the beard of the Spartan. It is a beard that makes the claim of a warrior. It seeks to exemplify certain virtues: austerity, laconicness, military prowess. It is a form of beard as mask: see the ‘tashe on the face-mask of the warrior buried at Sutton Hoo.

    This notion beard-as-mask means that perhaps one should not take this beard at face value.

    Consider the sporting beards of say, Ian Botham, Tiger Woods, George Best. These are all forms of mask. Interestingly, they come in at precisely those moments when there is an inner agony in the sportsman, when their mortality is at issue, when they are no longer in the youth. This beard seems to say, I am not that gilded youth, I am a man. But it is a disguise masking an inner anxiety.

    Does the beard of Hans Werner Sinn, in claiming so distinctly a military mind, cover an inner anxiety? We glimpse perhaps the young economist, junior, unsure even geeky and see this beard as a step towards the self-creation of an image.

    As an aside the beard of George Best, as with Brad Pitt, as well as being an attempt to claim adulthood, is an attempt to cover beauty. It says, do not value me for my youth and looks but for my other qualities. In this way the beard of Sinn, both points towards a vanity and away – to a vanity in other things.

    Of course it points to a particular masculine vanity. The beard is a potent symbol of male power. As all children know, even Cleopatra had a beard. There is a new feminist magazine called ‘Ladybeard’. Sinn’s beard does not attempt to seduce the female but asserts that he should be chosen a virile male yinn to her yang. Again, we see that the beard of Sinn is as much a performance of male power as a reality.

    But, again, what kind of power? I have suggested military, but of course there also a great tradition of naval beards. Navy beards are hierarchical. The higher you rise, the more face fungus you can display, until you arrive at the magnificent captain’s beard. George V displayed such a beard in an attempt to elide monarchy with the notion of the captain of the state. We are close here. Sinn is showing that he is the captain of the the ship. Not the solitary voice, but the master of a complex set of male structures, which retains a certain independence: or rather an independence at his command.

    Beard is also a verb: ‘to beard’ is to dare to attack by plucking at a beard. ‘to beard the lion in his den’. It is anecdotal, but apparently when Landseer unveiled the lions at the basic of Nelson’s column, a big game hunter said, ‘They are very fine, but if I shot one I would turn myself in for manslaughter’. The beard of Sinn then is not merely a mask, but a provocation: a lion-like challenge to combat. Like the King of Spain, it is asking to be singed; like the great beard of Basil Rathbone as the Sheriff, it is begging to be plucked. Will Kevin O’Rourke take up the implicit challenge and tweak such a tempting target?

    Mentioning Drake reminds us that the Captain may be an ambiguous figure to the nation that sends out the ship. The captain is of a nation and bears that nation’s flag, but is his own man when at sea. The beard of Sinn, which states that he will not run for office, suggests that he is of Germany, but that his interpretation of German interests remains his own.

    So it sets itself as a Spartan’s beard, a Captain’s beard, a lion’s beard. But is all these cases one must remind oneself that these are all performances, all attempts, as it were, to inhabit a sculpted pose of power: the very attempt suggests an inner anxiety.

    Finally I’ll turn to the much disputed, mysterious beard of Ozymandias. We are told: “Near them, on the sand, / Half sunk, a shattered visage lies, whose frown, / And wrinkled lip, and sneer of cold command, / Tell that its sculptor well those passions read.” The beard is famously not mentioned, but as with Ajax, Cleopatra, Leonidas the assumption is that he had one and the poet has quite deliberately shattered it.

    The revolutionary Shelly asks us to look away from the broken tyrant, who once saw a mighty empire, and see the lone and level sands stretching far away.

    The beard of Sinn may be a mask, a performance, a challenge and even a vortex, but perhaps the speakers must tear themselves away from the magnificent sight and see where his finger points: out to the destroyed landscape, is this where the beard of Sinn would ultimately lead us?

  2. Marvelous stuff Gavin 🙂

    He has the look of a Mennonite to me. And I see he’s a Munster man, the German version, home of the Anabaptists, who were averse to taking part in civil government. Perhaps the beard satisfies both his yearning to identify with his ancestors and his unconscious claim to the power that identity prevents him from assuming.

  3. Thanks Sarah. Good pointers.

    It seems the Anabaptists have both pacifist and non-pacifist traditions.

    I think it all comes together rather well in the beard of Captain Ahab (commonly thought to be as Gregory Peck’s chin curtain). Ahab is from the Quakers out of Nantucket, but Melville tells us that the Quakers of that place are not what we might expect:

    “Now, Bildad, like Peleg, and indeed many other Nantucketers, was a Quaker, the island having been originally settled by that sect; and to this day its inhabitants in general retain in an uncommon measure the peculiarities of the Quaker, only variously and anomalously modified by things altogether alien and heterogeneous. For some of these same Quakers are the most sanguinary of all sailors and whale-hunters. They are fighting Quakers; they are Quakers with a vengeance.

    So that there are instances among them of men, who, named with Scripture names—a singularly common fashion on the island—and in childhood naturally imbibing the stately dramatic thee and thou of the Quaker idiom; still, from the audacious, daring, and boundless adventure of their subsequent lives, strangely blend with these unoutgrown peculiarities, a thousand bold dashes of character, not unworthy a Scandinavian sea-king, or a poetical Pagan Roman.”

    The beard wishes to project: ‘a fighting Quaker with a character not unworthy of a Scandinavian sea-king’?

    I shall go and contemplate further.

  4. So Gavin, want to fill in any lurkers on our conclusions at today’s event?

    I thought it a MOST revealing couple of hours…

  5. Morning Sarah and lurkers.

    Two posts: one on the beard and one on the meeting.

    Sinn was late arriving – not his fault, high winds across Europe – but that actually built the sense of occasion up.

    I had the happy chance to sit next to Sarah, so we were able to compare notes.

    In the flesh, I think the fighting Amish/Anabaptist reading is the strongest. The beard is a magnificent sight. Sinn has more of a tan, and the blue eyes are more piercing than you would get from pictures. He’s a man who, when he looks at you, you know you’ve been looked at.

    It reminds me of a day in Galway when I passed a young man in a sunny weather, who was tall and wiry, with dead white skin, carrot red head which was long and wild, with almost blind-blue eyes, devastating cheekbones over a plaited beard. Shaggable too. A modern Celt.

    Anyway, perhaps it was Trinity, but Sinn seems almost a cousin of David Norris. This was compounded by the fact that they both lectured without notes, had the air of thinking aloud, and could respond to an audience. Norris is a little more ‘bling’ around the cuffs and tie, and more spontaneously witty (to his cost), but both are powerful older gentlemen who have an eye for a well cut suit. I think I associate ‘Amishness’ with relative poverty in the US, so it was fascinating to see a well presented, successful version of same. The suit of Sinn was not flashy, but it exuded an pleasure in finely woven cloth.

    Although I’ve said he has a piercing look, it is not so much an aggressive persona (though I wouldn’t like to be the researcher who had done an R&R on him), as more one of moral quest and almost inner vibration of conviction: though his ears are open and he tests who he is actually hearing (not pretending to hear) against that inner set of values.

    He’s a man I’d trust to mind my bike.

    If there are ambiguities, conflictions and cracks in the image and the man they were not apparent to my eye yesterday. He’s make a good subject for a novellist to really get into him.

    None of which is to say he is right about ‘wither Europe’.

  6. The meeting. Very annoyingly I’ve lost my notes, so this is from memory. Please cross-check with slides which I think were generously offered. Speakers and/or attendees feel free to correct.

    It was a packed modern lecture theatre in the Arts Building.

    Kevin O’Rourke confined himself to chairing.

    Richard Portes, Hans-Werner Sinn, Alan Taylor.

    All agreed that the crisis was in no way over, that changes had to be made, that terrible mistakes have been made at the European level, that there was still denial about those mistakes and that it was complex. They agreed, I think, that the losses from the financial crash have not been recognised (or rolled over all over the place), and this had to stop.

    They did not agree as to what those changes might be.

    Sinn, for example, thinks that the Euro should be a loose club of affiliates which it is not such a big deal to join and leave. We should not treat the Euro as a god. He thinks Greece should go as the austerity required is so appalling. He thinks that the Cyprus deal was a step forward in that losses went where they should go: onto the private creditors first.

    (aside, much criticism of the ELA in Cyprus going from Laika to Bank of Cyprus).

    It was put to Sinn that if this happened across Europe, it would mean German banks would go bust, and he said unequivocally, yes, they should go bust if they have made such losses and then the German government should decide how to deal with it. Sinn backed a recent presentation by Colm McCarthy in pointing out that Euro-banks are many times bigger than Euro-governments (gulp), and therefore only the private sector can take those losses.

    Sarah Carey lobbed him the question, ‘what about Soros’, and he summarised that as, ‘lead or leave’. He said basically, given political developments, be careful what you wished for and he didn’t see how that would help peripheral competitiveness. He also thought Keynsianism merely offering a pain killer.

    Richard Portes had spoken well but quickly (give ’em more time organisers!). He went after the idea that unit labour costs were not the key issue and that the peripheral nations had not lost market share. He also challenged Sinn as factually wrong in five places, particularly in the areas of the causes of the sovereign crises (all distinct), and the level of adjustment required. Sinn, who had walked in and spoken without notes (though one imagines he has said such things before), got his computer out and showed a graph with Lehman in the middle showing country by country how much *price* adjustment and changed before the crisis and how much was required, including Germany which has to go up. It was from Goldman Sachs (boos, hisses in the room).

    You could see from this where the meme ‘Ireland has done it’s homework’ has come from because we’ve actually over adjusted: all others have huge amounts to go, 30% or so.

    Portes robustly challenged *prices* as the most suitable measure. He said, quite briefly that you want to look at the gap in the tradable and non-tradable sectors as the key issue for adjustment. Can anyone expand on this? He also challenged the accuracy of the graphs.

    Alan Taylor took a more historical perspective and dryly pointed out that the dollar has taken 150 years to get to where it is now, and the euro simply hasn’t got that time. He also pointed out that the (second?) world countries that had been through the IMF business recently, had got on with building their houses of bricks and were doing better than the first world, unless the first world dragged them back down.

    He (and Portes) was very critical of the Eurogroup decision making process and pushed that they have to shift from ideological denial to an evidence based approach. This may only be achieved by people changing.

    Taylor and Sinn got into a less rumbustious disagreement as to the consequences of Jacksons creation of Fed., debt in, I think, the 1830s (hello Dork). Sinn thought the mutualisation of debt was a clear example and warning of moral hazard in the post, whilst Taylor thought that was a different world.

    In the end this was really an argument about euro(safe)bonds.

    It was put firmly to Sinn, plus the idea of a dual mandate, growth fans, for the ECB.

    This elicited the best and longest pause of the afternoon, before Sinn eventually said, ‘but then, you know, inflation’. He may as well have said, ‘but we will awake the dragon’. He thought that Eurobonds might happen, but they would be against his better judgement.

    This allowed Philip Lane, sitting quietly in the darkness, to make a one line intervention: ‘perhaps we should have a European wide conference on debt’. I think that is what the whole thing might have been about. Watch this space.

    I whipped in a question putting unemployment as the key issue. Sinn took it, and agreed completely, at length, that it was the number one issue and then said: TINA! The only thing to do is to restore (price) competitiveness.

    I know this is a long post: but actually I have raced through a very rich meeting and perhaps others could help flesh it out.

  7. Excellent minutes!

    I was struck by how Sinn had to conceive of solutions within the narrow parameters of his world view. So as Gavin observes, avoiding inflation is an article of faith for him as is his certainty that internal devaluation in the periphery is essential. But I bought into that proposition 4 years ago and whatever the graph says, I don’t see prices coming down. (And I’m sorry, but relying on Goldman Sachs to tell us where prices are or where they should be is not the strongest of foundations in my book).

    Having said that, while I very much enjoyed Taylor (who was fabulously dry and intense) and Portes (the showman who skewered establishment theory) I thought afterwards that absent beards they were just as fanatical about their positions.

    So what is the ignorant observer left to conclude but that there were 3 incredibly smart men in the room, each of whom clearly cares deeply about the effect of the crisis on the people of Europe and is suggesting policies they firmly believe will help, but if they can’t agree on a solution – and indeed can’t even agree on the data – then is a solution further away than ever?

    A depressing note but the debt conference idea seems promising if it could be put together. Do we call Suds in to schmooze his way round Europe to chair it? 😉

    Anyway, great fun and Gavin and I played Spot the Economist with the audience. That was Antoin Murphy who took issue with Portes was it not? I think I’ll do a show on Economics, not Science, but Religion.

  8. Thanks Gavin

    Sinn sounds like Beat Kappeler who writes for the NZZ. It is always the fault of people who are not organisiert wie uns hier in Mittereuropa. It makes sense in German.

    “He (and Portes) was very critical of the Eurogroup decision making process and pushed that they have to shift from ideological denial to an evidence based approach. ”

    Maybe the Eurogroup and the DoF can organise some remedial classes and split the costs. If they brought in the Republican Party it would be great value for money.

  9. Maybe Suds could chair a budget conference on behalf of Ireland?

    Is there still a belief that Sutherland is person who pursues Ireland’s interest.

    If there is the only reason it can be based on is that he is well ridiculously overpaid.

    The same Peter Sutherland who was chair of AIB in the 80s when it was bailed out by the state at a time when we had 116% debt.

    The same Peter Sutherland who was a director at RBS until it had to be nationalised.

    Wouldn’t that be the right man to send.

    Regarding economics not science but religion an interesting topic but the religion aspect of it as driven by one ego and two the need to be regarded as part of the respectable in the know more than religious passion

  10. I hadn’t thought of him as pursuing our interest but more (in the most light hearted of thoughts) as one of the world’s top schmoozers, the man whose favourite hobbie is name dropping. And to be fair the man who got the WTO agreement. Although on second thoughts, the man who might put GS interests before the Right Thing.

    You forgot to mention he’s the same Peter Sutherland who is unapologetically drawing a 50k pension from his time as A-G- the gravest sin in my book.

    Ok, scratch the Suds plan.

    Any other suggestions?

  11. @Gavin K./Sarah C.

    Thx for the reports. Was sorry to miss that. Was hoping to be able to nip over to it but the day’s work got the better of me.

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