Heresy in the temple
Posted by Charles II on September 10, 2015
Nasos Koukakis, CNBC:
The austerity imposed on Southern Europe after 2010 has led many famous economists to ban together and address the structural weaknesses of the monetary union. Some even have gone a step further by supporting European protest parties and leftist governments, demonstrating their opposition to the austerity policies.
Among them are Nobel Prize-winning economists Paul Krugman and Joseph Stiglitz; Jeffrey Sachs of Columbia University; James Galbraith of the University of Texas at Austin; and Thomas Piketty, professor at the Paris School of Economics.
In a joint letter, these acclaimed thinkers have asked the General Assembly of the United Nations today to back fundamental debt crisis principles concerning the restructuring of sovereign debts. The goal: to establish a legal framework for debt restructuring, allowing each state to solve its debt problems without risk of financial collapse and loss of sovereignty.
these economists have called for a relaxation of austerity, debt restructuring and investment-induced recovery. They are sharp critics of Germany’s commitment to budgetary discipline.
[John] Geanakoplos, an economist of Greek heritage [and James Tobin Professor of Economics at Yale] , believes that restructuring the public and private debt may eventually lead to smaller losses for the lenders.
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