Clive Crook

In a column for Bloomberg View--EU Pact Could Make Germany's Nightmare Come True--I try to make sense of Germany's approach to Europe's financial crisis. I can't claim I succeed. With the golden rule [which at Germany's insistence caps structural budget deficits at 0.5% of GDP] in place, the EU's next economic crisis will be an interesting moment. The best and (let's hope) likeliest course for the EU would be to suspend the rule or abandon it outright. That,… More »

Obama and his team should ease back on the transformational rhetoric and defend his proposals as commonsense responses. More »

I'm wondering how far the EU's collective idiocy can go. First, turn a resolvable sovereign debt crisis into an impending catastrophic banking crisis. Not enough? Then toss a constitutional crisis into the mix. But whatever you do, leave the forces driving the Union to disaster--right now, not ten years from now--unaddressed. While I am trying to get my mind round that, I am also trying to make sense of the way this proliferating avoidable calamity is being… More »

It might have been better not to create the euro in the first place, but now that it exists its "unwinding" is neither desirable nor inevitable. There is no unwinding of this system without causing a much worse mess than the one we already have. If you think things are hard right now, see what happens if the eurozone comes apart.Willem Buiter thinks through some of the possibilities in the FT: The terrible consequences of a eurozone collapse. His thinking on a… More »

Obama's speech in Kansas was the most important economic address of his presidency, says a delighted Robert Reich. Maybe so, if this was the moment the president definitively rebranded himself as a populist progressive, as Reich hopes. We'll see. Obama has many personas. Another day, another theme. But in Osawatomie, the president heavily stressed his "willingness to take on the powerful and the privileged that have gamed the system to their advantage". It was… More »

On taxes and income, the U.S. is on par with European countries. Have American progressives chosen the wrong policies to push? More »

How would Newt handle the presidency? His lack of discipline and need for grandeur suggest he'd be a disaster in the White House. More »

In a new column I criticize Germany's reckless inflexibility on the euro crisis.Germany owns the biggest house -- fully insured and with the best fire prevention money can buy -- in a tight cluster of dwellings in the European subdivision. One of those houses caught fire because the owner, despite repeated warnings, refused to fix a broken heater. Conditions are parched, and a hot, dry wind is picking up. The flames have spread, and several other houses are burning… More »

Stock markets perked up today partly at the announcement of new coordinated liquidity arrangements by the big central banks. (There were some modestly encouraging private-sector payroll numbers too.) Reaction to the central-bank initiative could have gone either way, I think. Since the move shows how anxious the monetary authorities are about what might be coming next from Europe, I wasn't especially reassured. If you see emergency workers stockpiling sandbags and… More »

Paul De Grauwe explains why the ECB, rationally by its own lights, is refusing to act as a lender of last resort. Once it has to deal with a full-scale banking crisis, it will step up, says De Grauwe: the costs of failing to do so are vast and instantaneous. But a sovereign debt crisis, which is all we have at the moment, unfolds more slowly, which makes delay seem more attractive. The sovereign debt crisis occurs at a snail's pace compared to banking crises. When… More »

This editorial in The Economist does an excellent job of explaining what is at stake in Europe.A euro break-up would cause a global bust worse even than the one in 2008-09. The world's most financially integrated region would be ripped apart by defaults, bank failures and the imposition of capital controls (see article). The euro zone could shatter into different pieces, or a large block in the north and a fragmented south. Amid the recriminations and broken… More »

As activists gain the upper hand, vocal minorities have come to dominate U.S. political debates, and the middle has lost its power More »

Notes on Obama, the differences between the left and right, and New York magazine's mostly good essay on the state of U.S. politics More »

This week's issue of The Economist has a wonderful pair of articles on migration: The magic of diasporas and Weaving the world together. They urge you to look at migration and globalization as though people, as well as states, mattered. This change of perspective is something of a revelation. Consider the difference between China and the Chinese people. One is an enormous country in Asia. The other is a nation that spans the planet. More Chinese people live… More »

I've written another column about Europe for Bloomberg: To Put Europe Back on Track Try Listening to Voters.Questions of sovereignty in the EU have moved from the theoretical realm to the street. People in Greece and other distressed countries are asking by what right foreign governments are demanding higher taxes, stripped-down public services and lower living standards. The current financial emergency isn't just a sovereign-debt crisis but also an EU… More »

A belated word of congratulations to the joint winners of this year's Bastiat Prize, both of them current or one-time colleagues of mine: Tom Easton of The Economist and Virginia Postrel of Bloomberg View. Easton's winning pieces were on China's entrepreneurs. [The West] should...celebrate bamboo capitalism more broadly. Too many people--not just third-world dictators but Western business tycoons--have fallen for the Beijing consensus, the idea that state-directed… More »

It's possible that President Obama's health-care law is both illegal and a good idea More »

Starting this week I'll be writing a column for Bloomberg View. I'll be ranging more widely than US politics, my terrain of late. My first article is on the euro:One thing nobody can say about the euro-region crackup: We never saw this coming. We saw it coming, all right. Europe's currency area is falling apart at the very fault lines skeptics described in detail when the plan was still just a plan.Sovereign-debt crises in peripheral countries? Collapsing… More »

Daniel Gros at Vox:As Italy's debt crisis enters the danger zone the question arises: Can Italy ever overcome its decade-old growth slump? This column shows that Italy's growth fundamentals are all in pretty good shape, except one - good governance. [The World Bank's] Worldwide Governance Indicators show a dramatic worsening during the Berlusconi governments especially when it comes to the rule of law, government effectiveness, and control of corruption. Progress… More »

James Hamilton provides a typically crisp, clear overview of the administration's new plan to promote mortgage refinancings. The scheme's main innovation is to remove obstacles to refinancing for underwater borrowers so long as they are up to date on payments. Like other analysts (see Calculated Risk), Hamilton concludes that the plan is helpful, as far as it goes. My conclusion is that the direct consequences of the proposal potentially may entail a modest… More »