Like Joschka Fischer's recent Project Syndicate piece, this is a disappointing piece from a European leader who's views I take seriously.
Solana's article can be easily summarized: he talks about ways to improve the eurozone economy without once using the word "austerity," which of course means that he doesn't condemn the destructiveness of the current Herbert Hoover/Heinrich Brüning austerity policies driven by German Chancellor Angela Merkel that are wrecking the eurozone economy.
At this point, anyone who's serious about the survival of the euro and the EU should be focusing on the urgent need to end the austerity policies and get an economic recovery going in the eurozone.
Solana was a Socialist Foreign Minister of Spain, and at least his tone reflects the left version of neoliberalism. But his actual proposals are insubstantial in dealing with the eurozone economy in the early stages of lowflation/deflation. For instance, there's the magic of R&D:
No pro-growth policy is as important as stimulating public and private research and development. The EU should, for example, allow R&D spending (and some spending on active labor-market policies targeting young people) to be left out of member states' deficit accounting. This principle has been applied to aid to the financial sector; it is no less appropriate for investment.As a general rule, more R&D is preferable for a country than less. But boosting R&D creates jobs in the long-term. Neither that nor a small-bore policies to marginally reduced youth unemployment are going to give the eurozone economy the economic stimulus it needs to avoid further depression and start a recovery.
He evenly writes breezily, "Now that the worst of the euro crisis seems to have passed ..."
Not likely. But miracles do happen.
Tags: angela merkel, austerity economics, eu, euro, european union, javier solona
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