Wednesday, August 17, 2016

Stiglitz on the Eurozone

Joe Stiglitz, Nobel prize winnning economist, was a guest on CNBC this morning.  He seems to have checked his economics at the door before going on.  He believes, now, that Euro taxpayers should simply bail everyone out and that what Europe needs is a more dictatorial Eurozone political regime.  Not much room for economic or political freedom in the Stiglitz view.

His bizarre view on bankruptcy is that you should permit bankruptcy to occur only when the holders of the debt are people that you approve of.  That is truly bizarre.  Before permitting bankruptcy, you have to check to see who the latest debt holders are.  Joe strongly supported bailing out Greece, without any austerity requirements.  That must have been a comforting view to Joe's hedge fund buddies who owned a significant amount of Greek debt.

Stiglitz, if you can believe it, is even more polemical than Paul Krugman and that takes some doing.

All of this is part of the modern era in the discipline of Economics.  It isn't about Economics anymore, it's about who your political and economic buddies are.  Stiglitz and Krugman are now left wing idealogues, not economists in the normal sense of that word.

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