Month: January 2012

The tragedy of the European crisis is not that it was caused by striving for too much economic efficiency. The real tragedy is that it could have been predicted by public choice theory

Europe has run out of easy solutions to its many simultaneous crises. When it runs out of money to even buy itself more time to gloss over the symptoms of a dysfunctional monetary union, perhaps European leaders will finally start tackling the underlying problems. Time has become unaffordable

A car industry is only worth having if it is able to stand on its own feet. Keeping an industry alive for the sake of having an industry is economic folly and a waste of taxpayers’ resources.

Whoever believed that the never-ending eurozone crisis had been solved during the holiday break would have been surprised by the difficult French bond auction last week, Italian yields once again shooting above the crucial 7 per cent mark, and renewed speculation about a Greek default.

Both the Bank of England and the German Bundesbank enjoy formal independence, but this independence looks and feels very different in practice. One can be free of all vices without having a single virtue. In the same way, central banks can be formally independent without adding to economic and financial stability.