1 Outlook for global economy in 2015 is ‘not bad’ (Andrew
Walker on BBC) The outlook that emerges for the world economy from many
forecasts is perhaps best described as "not bad", though inevitably
there are risks, some of them quite substantial. The International Monetary
Fund predicts global growth this year of 3.8% compared with 3.3% in 2014. That
is not boom-time, though it would be the fastest growth since 2011.
There is often a "but" that comes with
comes with an economic forecast, and this time there are quite a few. One of
them is a development which might actually be a boost for most of the world. It's
the price of crude oil which has fallen by nearly half from the high it reached
in June. For most countries it means consumers have more to spend on other
things and it reduces business costs.
The main source of strength expected by most
forecasters is the US. The IMF reckons economic growth there is likely to be
almost a full percentage point faster than 2013. The continued recovery in the
US means the country's central bank, the Federal Reserve will probably raise
its main interest rate, which has been close to zero for six years.
Higher interest rates would make American markets
more attractive to investors, so funds could be pulled out of other countries
especially emerging markets. The danger is that it might happen in a disruptive
way that leads to sharp currency declines, higher inflation and rising
borrowing costs for governments and business in developing countries.
China is another important factor. The country's
economic slowdown is likely to continue: that is almost universally seen as
inevitable sooner or later. Jan Hatzius, chief economist at the investment bank
Goldman Sachs expects "several years of declining growth rates" for
China. And now there is new uncertainty about the eurozone as Greece prepares
for an early election.
2 ‘Europe’s economic madness cannot continue’
(Joseph Stiglitz in The Guardian) Yes, America mismanaged its economy; but, no,
the US did not somehow manage to impose the brunt of the global fallout on
Europe. The EU’s malaise is self-inflicted, owing to an unprecedented
succession of bad economic decisions, beginning with the creation of the euro.
Though intended to unite Europe, in the end the euro has divided it; and, in
the absence of the political will to create the institutions that would enable
a single currency to work, the damage is not being undone.
The current mess stems partly from adherence to a
long-discredited belief in well-functioning markets without imperfections of
information and competition. What Europe needs more than structural reform
within member countries is reform of the structure of the eurozone itself, and
a reversal of austerity policies, which have failed time and again to reignite
economic growth.
Those who thought that the euro could not survive
have been repeatedly proven wrong. But the critics have been right about one
thing: unless the structure of the eurozone is reformed, and austerity reversed,
Europe will not recover. But the euro took away from citizens any say over
their economic destiny.
But for how long can this continue? And how will
voters react? Throughout Europe, we have seen the alarming growth of extreme
nationalist parties, running counter to the Enlightenment values that have made
Europe so successful. In some places, large separatist movements are rising.
If Europe does not change its ways – if it does not
reform the eurozone and repeal austerity – a popular backlash will become
inevitable. Greece may stay the course this time. But this economic madness
cannot continue forever. Democracy will not permit it. But how much more pain
will Europe have to endure before reason is restored?
3 Quarrelsome French unite to protect nation’s
values (San Francisco Chronicle) The often quarrelsome French who make it a
point of honor to shout their differences, for a parking spot or a high-minded
idea, joined in a single cry of "Charlie" at Sunday's unity march,
the largest demonstration in Paris since France started keeping track.
This time it was for democratic values that include
the right to freedom of expression. These are values that the terror attacks by
three French citizens, all Islamist radicals, sought to undermine, it is widely
agreed — and force the nation that gave birth to the Enlightenment to go dark.
"Je suis Charlie or "We are Charlie"
or simply "Charlie" was the overriding slogan of the march, a phrase
the world has taken up since the Jan. 7 newsroom massacre in the offices of the
irreverent, satiric weekly Charlie Hebdo. France lost some of its top
cartoonists.
The last demonstration of such breadth that I
covered was the joining of the political right and left to ensure that
far-right leader Jean-Marie Le Pen wouldn't become France's new president. That
was in 2002 when Le Pen reached the final round of voting and was facing off
against conservative incumbent Jacques Chirac. Such a joining of rightist and
leftist forces for a march from the Place de la Bastille was a spectacular
political event. Chirac won 82 percent of the vote.
Charlie Hebdo (whose name is a wink at former President
Charles de Gaulle) has had several lives, and will resurrect itself on
Wednesday as a special ‘Newspaper of Survivors.’ "If we show fear, they
win," demonstrator Thebault said of the terrorists. He added, "We're
not going to understand each other by making war."
