ELLOS TODAVIA NO LO HAN COGIDO

Otra vez un Agosto "sangriento".

Lo que está en juego debería estar muy claro y, sin embargo, asistimos una y otra vez a la repetición de la misma confusión, impotencia y falta de decisión.

Demasiado poco y demasiado tarde.

Algunas referencias a una situación que no puede ser peor ni más peligrosa:

CHARLES WYPLOSZ

THE EUROZONE LEADERS STILL DON'T GET IT

The Eurozone crisis is accelerating dangerously and could tip the world into a new recession that cannot be fought. Interest rates are already zero and governments cannot borrow much anymore. The spectre of the 1930s, including competitive devaluations and Eurozone break up, is getting dangerously relevant. This column argues that the only way forward is for the ECB to guarantee the entire stock of Eurozone debt and for Eurozone members to adopt effective, national fiscal institutions.

In this crisis, Eurozone leaders’ motto seems to be “too little too late”.

They got it badly wrong the first weekend in May 2010. Having announced that they had saved Greece, financial markets said “not good enough”. The next weekend they came up with a more substantial plan, but even this proved to be too little too late.

After months of living in denial, Eurozone leaders finally recognised that Greece was not going to be able to restart borrowing on its own. They came up with another plan. On 21 July 2011, they got it badly wrong again. Financial markets are again saying “not good enough”.

Cluelessness, powerlessness, or weakness?

In contrast to the extreme clarity of the market’s message, the raft of declarations from policymakers around the world suggests:

• They still do not to understand how dangerous the situation is; or
• They do not understand what they need to do, or
• They are unwilling to do what they know must be done.

This is why reassuring words backfire. Markets suspect that nice words are all that policymakers are in a position to offer. This prevarication by Eurozone leaders needs to change rapidly if a disaster is to be avoided.

A clear misunderstanding of the situation

For a year and a half, policymakers have thrown good money after bad in carefully measured doses. Whether it was due to political expediency (gambling for redemption) or due to wishful thinking (the economic recovery will fix everything), policymakers have misdiagnosed the problem.

Unfortunately, we are not a situation where a “bridging loan” can help highly indebted nations get through a rough spot. Feeding markets a few dollops of euros is like treating a broken leg with ice; it may help for a while but it fails to address the core problem.

In short, we are not in a liquidity crisis; we are in a confidence crisis.

The danger ahead

History tells us that a loss of confidence can trigger a cyclone of doubt and falling bond prices. Once triggered, such cyclones can and have washed away even the mightiest. The mechanics of such cyclones are well understood.

When investors assign a positive probability to sovereign default, nations must pay a risk premium to continue borrowing and rolling-over their debt. The higher interest payments raise the debt-service burden. The cyclone gains strength as this tends to undermine solvency which in turn stokes doubts and raises the risk premium.

Fiscal austerity is needed to avoid such cyclones, but attempts to redress solvency via fiscal austerity in the midst of a crisis may make things worse. Cutting spending and raising taxes can trigger or deepen a recession that lowers tax receipts and raises welfare spending – again undermining the debt’s sustainability. When markets see this, they ask for a higher risk premium and the cyclone gains strength.

Eurozone investors’ fears are amplified by the poisonous combination of banks that are both in fragile state overall and heavily invested in Eurozone bonds. As we saw in Ireland and Iceland, governments who have to bail out their banks can find themselves drawn into a self-fulfilling confidence crisis.

The size of the problem

The real danger lies in the fact that financial market equilibria concern stocks, not flows. We are not talking about the fraction of the debt that is due in the next months – as we would be if this were a liquidity crisis. The cyclone logic gets applied to the entire stock of national debt. This involves truly astronomical sums. When we add up the public debts of Greece, Ireland, Portugal, Spain and Italy, we reach something like €3,350 billion; that is 35% of the Eurozone GDP; 130% of German GDP.

The contagion has spread, and will continue spreading until a real solution is in place.

• Italy and Spain probably passed the point of no return.
• Belgium and France could be next.

The Italian case has shown that a mundane political accident – a public disagreement between the Prime Minister and the Finance Minister – can start the cyclone turning. Further rating downgrades of Eurozone nations – an event that cannot be ruled out given the US’s downgrade – could be the next trigger. A recession in the US and/or Europe could be another.

Solutions that won’t work

Plainly, we are facing a very dangerous situation. Eurozone leaders must quickly wake up and realise the severity of the threat they face. Their 21 July plan – which involved the EFSF fixing the problem defined as Greece while Italy and Spain are now the issue – is dead on arrival. There is no way the EFSF can deal with the amounts involved. If it tries we will have a German debt crisis.

This is a continuation of the central mistake made by policymakers – the belief that it is enough to buy a little bit of debts now and then to quiet financial markets until things get better.

What must be done to halt the confidence crisis?

The authorities must jump ahead of the curve and put in place an arrangement that effectively stops the rot. Instead of reacting, policymakers must start acting. There is only one way to stop the cyclone of doubt and falling bond prices. We must put a floor on public debt valuation. The stock of sovereign debt must be divided into two piles – bonds to guarantee, and bonds to default upon. This is how one jumps ahead of the curve.

The only institution in the world that can put up such amounts of money is the ECB. This is why central banks are lender in last resort. In fact, the ECB does not have to spend this money.

Guaranteeing public debts does not have to be expensive. As suggested to me by David Lucca from the New York Fed, the model should be bank deposit guarantees.

• In 2008, most countries guaranteed 100% of bank deposits to stem incipient bank runs and guess what? There was no bank run and not one cent had to be spent.
• In the case at hand, it is likely that the markets would challenge the ECB, so some money will be spent, but most likely very little.

In fact, the best solution is for the ECB to simply guarantee the rollover at face value of maturing sovereign debts. This should immediately stop the sovereign debt crisis.

By contrast, using the EFSF would be expensive. The EFSF would have to raise money – i.e. raise public debts – to buy public debts.

What to do about Eurozone public finances?

An ECB guarantee would handle the debt crisis, but would not address the ongoing problem of government deficits. Here is where the IMF comes in. The financing of ongoing deficits is the job of the IMF. In setting up its conditions, the IMF should resist its ancient gut reaction of imposing immediate austerity. Greece & Co. need to grow first and stabilize their debts next, in that order.

Here it is worth noting a striking change of roles. Markets are supposed to be short-termists while governments take pride in taking the longer view. In this crisis, we have seen governments offering solutions that aim at immediate results. Market participants, on the other hand, seem to be waiting for credible commitments to restore public finance health sometime in the future.

Markets understand that Greece or Italy cannot cut their deficits in the midst of a recession. All they want is to be reassured that politicians are ready to give up the deficit game and eventually reduce debts, even if that takes decades.

On this score there may be a glimmer of hope. Portugal, Ireland and Italy are now actively preparing institutional changes in the spirit of the Swiss and German debt brakes or the Swedish Fiscal Council. (The French President has put forward his own modest – probably insufficient – constitutional amendment, but divided politics in the run to elections next year stand in the way.) The EU Commission has also made a similar proposal, unfortunately buried with the fateful Euro-plus project of strengthening the Stability and Growth Pact.

Effective institutions and an ECB guarantee will do it

Shouldering this burden is not something the ECB will do lightly. But it should consider the alternative. If the ECB is not willing to do this job, it will have to spend huge sums to buy back public debts.

Because of the stock nature of financial markets, the ECB’s call for the EFSF to take the lead is wholly inadequate. When the EFSF runs out of resources, the ECB will have to stand ready to buy potentially all of the distressed sovereign debts – a list that is bound to expand if this course of action is maintained.

The ECB will have to buy back the debt at distressed prices to avoid raising their market values and therefore the cost of the rescue. In short, as lender of last resort, the EBC will have to organize debt defaults. This will lead to bank failures and more public money to be spent, again by the ECB. Here the ECB might ask their Swiss and Swedish colleagues how to bail banks out and make a profit on it.

There are no doubt other solutions but all are bound to involve the ECB. The key is that markets will not be quieted down until comprehensive measures are taken. The “kick the can down the road” strategy has been politically expedient, but its cost has been enormous.

Conclusion

It was wrong to bailout Greece in May 2010 (Wyplosz 2011). But now is not the time for regret. It is not the time to try to correct past mistakes. We will eventually have to draw the lessons from the crisis – and governments should ask impartial experts to do that – but now we have no choice. We must follow to its bitter end the logic adopted in May 2010.

In the end, finding a good solution is technically easy, but politically difficult.

Europeans have watched the US’s conflict over the debt ceiling with awe and scorn, but their behaviour over the last year and half has been much worse.

• The French want to pour money on the problem;
• The Germans want to punish fiscal misbehaviour; and
• The ECB does not want to bear risk.

All of that is bringing the world to a new recession, which we will not be able to combat because interest rates are at the zero lower bound and governments cannot borrow much anymore.

The spectre of the 1930s, including competitive devaluations as the euro breaks up, is getting dangerously relevant.

Charles Wyplosz © voxEU.org

References

Wyplosz Charles (2010). “And now? A dark scenario”, VoxEU.org, 3 May.

MISION IMPOSIBLE SEGUN ROUBINI

So can we avoid another severe recession? It might simply be mission impossible. The best bet is for those countries that have not lost market access – the US, UK, Japan, and Germany – to introduce new short-term fiscal stimulus while committing to medium-term fiscal austerity. The US downgrade will hasten demands for fiscal reduction, but America in particular should commit to look for significant cuts in the medium term, not an immediate fiscal drag that will worsen growth and deficits.

Most western central banks should also introduce further QE, even though its effect will be limited. The European Central Bank should not just stop rate hiking: it should cut rates to zero and make big purchases of government bonds to prevent Italy or Spain losing market access – the outcome of which would be a truly major crisis, requiring doubling (or tripling) of bail-out resources, or debt workouts and a eurozone break-up.

Finally, since this is a crisis of solvency as well as liquidity, orderly debt restructuring must begin. This means across the board reduction on the mortgage debt for the roughly half of America’s households that are underwater, and bail-ins for creditors of banks in distress. Greek-style coercive maturity extensions, at risk free rates, must also come for Portugal and Ireland, with Italy and Spain to follow if they lose market access. Another recession may not be preventable. But policy can stop a second depression. That is reason enough for swift and targeted action.

The writer is chairman of Roubini Global Economics, professor at the Stern School, NYU and co-author of Crisis Economics

Copyright The Financial Times Limited 2011




EL EXCESO DE AHORRO A NIVEL MUNDIAL MANTENDRA LOS TIPOS DE LA DEUDA

Heleen Mees.Copyright.VoxEU.org

NO SOLO EL EURO, TAMBIEN LA DEMOCRACIA

CUESTION DE ALTERNATIVAS

(...)

¿Qué hay que explicar? Que la política sin alternativa es ella misma, y por sí misma, y por eso mismo, una amenaza a la pervivencia de la democracia en Europa, como acaba de advertir el nada alarmista premio Nobel de Economía Amartya Sen desde las páginas del diario The Guardian el 22 de junio de 2011. Que la sola idea de una austeridad fiscal "expansiva" es una ignorante ilusión nacida de la destrucción de la teoría macroeconómica acometida por académicos a sueldo y cabilderos varios en las tres últimas décadas, ese "periodo oscuro", de olvido premeditado y banderizo de conocimientos sólidamente adquiridos por las generaciones anteriores, como han repetido hasta la saciedad otros dos premios Nobel, Paul Krugman y Joseph Stiglitz.

En suma: que la política económica "sin alternativa" no es propiamente una alternativa creíble -ni siquiera desde sus propios supuestos normativos-, sino una ofensiva en toda regla contra la soberanía y el bienestar de las poblaciones trabajadoras europeas e incluso, posiblemente, como ha advertido la ONU a propósito de Grecia, contra los derechos humanos tout court. Una ofensiva que no puede sino traer consigo ruina, dolor, desigualdad y conflictos sociales de creciente pugnacidad y consecuencias imprevisibles.Un año después del giro del 9 de mayo -cuando supuestamente estuvimos "al borde del abismo"- y del inicio de las contrarreformas "salvadoras", el desempleo y la precariedad laboral están peor, no mejor. La recaudación fiscal cae. Las ventas minoristas se han desplomado en el primer semestre de este año. Crecen la morosidad y las ejecuciones hipotecarias. Se dispara la pobreza. Los mercados financieros, lejos de "calmarse", parecen exigir con redoblada ferocidad ulteriores sangrías: nuestra prima de riesgo es ahora indeciblemente más alta. La derecha política hostil al Estado social anda recrecida; la izquierda social, desengañada de la política. Y toda Europa se halla en zozobra: cayó Irlanda, luego Portugal, y ahora se ciernen negras amenazas sobre la tercera economía europea, Italia, y con ella, nuevamente sobre España.

La política "sin alternativa creíble" es ella misma increíble: eso es lo que han entendido los millones de indignados que se lanzan a la calle en Grecia, en España, en Italia, en Portugal o en Gran Bretaña. ¿Por qué, pues, parece no haber alternativa? Primero, claro, porque el establishment lo repite sin cesar, en todos los grandes medios de comunicación, públicos y privados: a veces, hasta fingiendo lamentarlo. Y porque se ningunea a las voces discordantes, a las moderadas no menos que a las radicales. Un día, un redicho locutorcillo de tres al cuarto de la televisión pública catalana se permite hablar con displicencia del premio Nobel Krugman: "Sus propuestas keynesianas contra la crisis ya fracasaron". Otro, un sociólogo electoral, se permite glosar con cuatro tonterías superficiales desde las páginas de EL PAÍS la teoría cognitiva de las metáforas -de la que, obviamente, no entiende una palabra- y a cuenta de eso, despachar sin mayor argumentación, además de a los indignados, a todos los economistas y científicos sociales críticos de ATTAC, a los que nos llama sin más "colectivistas" trasnochados. Y así sucesivamente.

La impresión dominante es que cualquier alternativa imaginable a la política "sin alternativa" habrá de estrellarse contra el pétreo muro de una troika empeñada ahora en destruir la democracia europea con el mismo celo dogmático con que llevó incompetentemente a nuestra economía a la catástrofe en 2008. Contestando a Llamazares, el presidente Zapatero lo expresó con patetismo en el debate parlamentario: "No ha sido un giro a la derecha", sino... un "paso atrás" (verosímilmente, ante fuerzas políticamente insuperables). La "edad oscura de la macroeconomía" lamentada por Krugman parece haber nublado también las cabezas de muchos políticos de centro-izquierda, lo que, en convergencia con la sensación de impotencia política, les hace ver como radicales o como implausibles, o aun como técnicamente inviables, medidas que, razonabilísimas y dignas cuando menos de ser debatidas, no tendrían, en principio, mucho de tales. Por ejemplo, la reivindicación de una renta básica universal de ciudadanía ligada a un nuevo robustecimiento del Estado social y democrático de derecho, una reivindicación que ahora mismo está abriéndose, vigorosamente, paso entre los indignados europeos y que no hace tanto mereció el respeto y la simpatía de la izquierda y del centro-izquierda parlamentarios españoles.

Dos cosas están claras, cuando menos. La primera: que en la raíz de los males económicos que aquejan a la eurozona hay un problema de diseño institucional básico, cual es la carencia de una autoridad fiscal capaz de lidiar con la crisis a través de políticas de estímulo fiscal, en vez de limitarse a las erráticas y vergonzantes semimedidas camufladas de política monetaria del BCE (como el amago, este 12 de julio, de compra de deuda soberana de Estados miembros por parte del BCE, para frenar in angustiis el desplome de la renta variable y la espiral del riesgo país en España y en Italia). La segunda: que quienes de verdad parecen mandar en la UE no tienen la menor voluntad política de cambiar el diseño. Y eso es lo que parece condenar, quieras que no, al conjunto de la eurozona a una carrera hacia el abismo de la deflación competitiva y la destrucción salarial, y a los países periféricos, a la austeridad fiscal neoliberal, a la progresiva puesta en almoneda de todo su patrimonio público y al suicidio económico sin esperanza.

Eso tal vez no tiene remedio a corto plazo, salvo que la amenaza de un gran -y cada vez menos improbable- movimiento de contestación social fuerce a las élites europeas a otro camino (para empezar, a algo tan sencillo como que el BCE emitiera eurobonos respaldados de consuno por los miembros de la eurozona). Aun así, seguiría habiendo alternativas estrictamente nacionales harto menos traumáticas que una posible -y al paso que vamos, quizá inevitable- salida del euro. Hace meses, por ejemplo, que el sólido Marshall Auerback viene proponiendo a Grecia un camino alternativo de salvación nacional y de preservación de los derechos humanos y sociales de su población. Incluso en su actual situación límite, Grecia -como la República de Irlanda, como la república portuguesa, como el Reino de España- podría perfectamente colocar con éxito en mercados financieros privados bonos públicos emitidos con la cláusula de que, en caso de declararse en quiebra, sus tenedores podrían usarlos para pagar impuestos al Gobierno griego. Un expediente que haría inmediatamente obvio a los inversores que los nuevos títulos públicos serían "moneda buena", valedera mientras el Estado griego sea capaz de exigir y recaudar impuestos.

Es solo un ejemplo, entre muchos. ¿No es sospechoso que, mientras abundan la conspiración del silencio y la gratuita descalificación de quienes se oponen al desastre anunciado, escasee en los grandes medios de comunicación establecidos la discusión sobre propuestas alternativas de este tipo?

Antoni Domènech es catedrático de la Facultad de Economía y Empresa de la UB. Daniel Raventós es profesor titular en esa misma facultad y presidente de la Red Renta Básica (www.redrentabasica.org). Ambos son miembros del Consejo Científico de Attac-España y redactores de la revista política SinPermiso (www.sinpermiso.info).

(EL PAIS 14-07-2011)

NO SOLO EL EURO ESTA EN JUEGO, TAMBIEN LA DEMOCRACIA

Europe has led the world in the practice of democracy. It is therefore worrying that the dangers to democratic governance today, coming through the back door of financial priority, are not receiving the attention they should. There are profound issues to be faced about how Europe's democratic governance could be undermined by the hugely heightened role of financial institutions and rating agencies, which now lord it freely over parts of Europe's political terrain.

Two distinct issues need to be separated. The first concerns the place of democratic priorities, including what Walter Bagehot and John Stuart Mill saw as the need for "governance by discussion". Suppose we accept that the powerful financial bosses have a realistic understanding of what needs to be done. This would strengthen the case for paying attention to their voices in a democratic dialogue. But that is not the same thing as allowing the international financial institutions and rating agencies the unilateral power to command democratically elected governments.

Second, it is quite hard to see that the sacrifices that the financial commanders have been demanding from precarious countries would deliver the ultimate viability of these countries and guarantee the continuation of the euro within an unreformed pattern of financial amalgamation and an unchanged membership of the euro club. The diagnosis of economic problems by rating agencies is not the voice of verity that they pretend. It is worth remembering that the record of rating agencies in certifying financial and business institutions preceding the 2008 economic crisis was so abysmal that the US Congress seriously debated whether they should be prosecuted.

Since much of Europe is now engaged in achieving quick reduction of public deficits through drastic reduction of public expenditure, it is crucial to scrutinise realistically what the likely impact of the chosen policies may be, both on people and the generating of public revenue through economic growth. The high morals of "sacrifice" do, of course, have an intoxicating effect. This is the philosophy of the "right" corset: "If madam is at all comfortable in it, then madam certainly needs a smaller size." However, if the demands of financial appropriateness are linked too mechanically to immediate cuts, the result could be the killing of the goose that lays the golden egg of economic growth.

This concern applies to a number of countries, from Britain to Greece. The commonality of the "blood, sweat and tears" strategy of deficit reduction gives some apparent plausibility to what is being imposed on more precarious countries like Greece or Portugal. It also makes it harder to have a united political voice in Europe that can stand up to the panic generated in the financial markets.

In addition to a bigger political vision, there is a need for clearer economic thinking. The tendency to ignore the importance of economic growth in generating public revenue should be a major item for scrutiny. The strong connection between growth and public revenue has been observed in many countries, from China and India to the US and Brazil.

There are lessons from history here, too. The big public debts of many countries when the second world war ended caused huge anxieties, but the burden diminished rapidly thanks to fast economic growth. Similarly, the huge deficits that President Clinton faced when he came to office in 1992 melted away during his presidency, greatly aided by speedy economic growth.

The fear of a threat to democracy does not, of course, apply to Britain, since these policies have been chosen by a government empowered by democratic elections. Even though the unfolding of a strategy that was not revealed at the time of election can be a reason for some pause, this is the kind of freedom that a democratic system does allow the electorally victorious. But that does not eliminate the need for more public discussion, even in Britain. There is also a need to recognise how the self-chosen restrictive policies in Britain seem to give plausibility to the even more drastic policies being imposed on Greece.

How did some of the euro countries get into this mess? The oddity of going for a united currency without more political and economic integration has certainly played a part, even after taking note of financial transgressions that have undoubtedly been committed in the past by countries such as Greece or Portugal (and even after noting Mario Monti's important point that a culture of "excessive deference" in the EU has allowed these transgressions to go unchecked). It is to the huge credit of the Greek government – George Papandreou, the prime minister, in particular – that it is doing what it can despite political resistance, but the pained willingness of Athens to comply does not eliminate the European need to examine the wisdom of the requirements – and the timing – being imposed on Greece.

It is no consolation for me to recollect that I was firmly opposed to the euro, despite being very strongly in favour of European unity. My worry about the euro was partly connected with each country giving up the freedom of monetary policy and of exchange rate adjustments, which have greatly helped countries in difficulty in the past, and prevented the necessity of massive destabilisation of human lives in frantic efforts to stabilise the financial markets. That monetary freedom could be given up when there is also political and fiscal integration (as the states in the US have), but the halfway house of the eurozone has been a recipe for disaster. The wonderful political idea of a united democratic Europe has been made to incorporate a precarious programme of incoherent financial amalgamation.

Rearranging the eurozone now would have many problems, but difficult issues have to be intelligently discussed, rather than allowing Europe to drift in financial winds fed by narrow-minded thinking with a terrible track record. The process has to begin with some immediate restraining of the unopposed power of rating agencies to issue unilateral commands. These agencies are hard to discipline despite their abysmal record, but a well-reflected voice of legitimate governments can make a big difference to financial confidence while solutions are worked out, especially if the international financial institutions lend their support. Stopping the marginalisation of the democratic tradition of Europe has an urgency that is hard to exaggerate. European democracy is important for Europe – and for the world.

AMARTYA SEN

• guardian.co.uk © Guardian News and Media Limited 2011

TEDH: STEFANICA Y OTROS V. RUMANIA

CASE_OF_STEFANICA_AND_OTHERS_v._ROMANIA

View more documents from Guillermo Ruiz Zapatero

TEDH: STEFANICA Y OTROS V. RUMANIA

Uno de los aspectos más destacados de las sentencias y jurisprudencia del TEDH es que obligan a interpretar la legislación y jurisprudencia nacional a la luz de consideraciones independientes no afectadas por formulismos o rutinas poco compatibles con la administración de justicia. Se trata de una manifestación del pluralismo jurídico, porque el resultado alcanzado por una jurisdicción nacional se somete a una consideración completamente nueva sin otras ataduras que los derechos garantizados por la Convención y la propia jurisprudencia del Tribunal. El caso experimenta por ello una suerte de “deconstrucción” o liberación de los moldes impuestos por las reglas procesales y sustantivas de la jurisdicción nacional, sin perder por ello sus características propias.

Como precisa la sentencia aquí comentada:

“El Tribunal es dueño de la calificación jurídica de los hechos del caso y no está vinculado por la calificación dada por el demandante o su gobierno. Una demanda está caracterizada por los hechos alegados en ella y no meramente por los fundamentos o argumentos legales en los que se apoya (ver Powell y Rainer v. Reino Unido, 21 de Febrero de 1990, 29;y Guerra y otros v. Italia, 19 de Febrero de 1998, 44)” (Stefanica y otros v. Rumania,2 de Noviembre de 2010, 23)

La demanda (nº 38155/02) estimada por el TEDH se refiere a un colectivo de trabajadores rumanos que fueron despedidos en un procedimiento de despido colectivo u objetivo de un banco del sector estatal y que no percibieron la indemnización legalmente establecida para dichos supuestos como consecuencia de una sentencia desestimatoria de un Tribunal regional.

La sentencia desestimatoria del Tribunal regional (de fecha 25 de Marzo de 2002) sostuvo que dicha indemnización exigía una decisión previa de un denominado Fondo de la Propiedad Estatal y la participación en determinados procedimientos previos al despido colectivo.

Sin embargo, otros trabajadores afectados por despidos colectivos en la misma entidad bancaria obtuvieron bien un pronunciamiento favorable del Tribunal Supremo en un recurso extraordinario no dirigido a establecer jurisprudencia (Sentencia de 1 de Octubre de 2003) o bien decisiones favorables de los Tribunales regionales (sentencias de 30 de Junio de 2003 y 3 de Septiembre de 2004).

Las sentencias del Tribunal Supremo y de los Tribunales regionales concluyeron que el derecho a al indemnización no estaba afectado por la falta de decisión previa del denominado Fondo de la Propiedad Estatal y que la negligencia del empresario que determinó la no participación de los trabajadores despedidos en los procedimientos previos al despido colectivo tampoco afectaba a su derecho a percibir la indemnización legal.

Aunque los trabajadores formularon su demanda invocando los artículos 6.1, 2.1, 13 y 17 de la CEDH, el TEDH la examina “en sustancia” a la luz de los artículos 6.1, y1 del Protocolo 1 (“derecho al disfrute pacífico de los bienes”) en conjunción con el artículo 14.

Estos son los principales fundamentos de la sentencia estimatoria:

“22. (…) the applicants complained that the rejection of their claim by the Bucharest County Court was contrary to the solution adopted at final instance by other county courts across the country and that they had thus been deprived of the compensatory payments to which they were entitled. They also claimed that the domestic courts were not impartial or independent and had delivered a wrongful decision in their case.

23. The Court is master of the characterisation to be given in law to the facts of the case and is not bound by the characterisation given by an applicant or a government. A complaint is characterised by the facts alleged in it and not merely by the legal grounds or arguments relied on (see Powell and Rayner v. the United Kingdom, 21 February 1990, § 29, Series A no. 172, and Guerra and Others v. Italy, 19 February 1998, § 44, Reports of Judgments and Decisions 1998-I). Having regard to this, the Court considers that the applicant's complaints are to be examined under Article 6 § 1 of the Convention and Article 1 of Protocol No 1 in conjunction with Article 14 of the Convention.

(…)

26. The Government submits that conflicting case-law within a legal system based on jurisdiction over specific geographic areas is not of itself incompatible with the requirements of Article 6 § 1. According to them, the applicants had failed to bring forward proof of a divergent case-law adopted consistently at national level or by the highest jurisdiction and had provided only a limited number of examples of divergent solutions.

27. The Government further underlines that contrary to the factual situation in the case of Beian v. Romania (no. 1) (no. 30658/05, ECHR 2007‑XIII (extracts)), the divergent case-law in the present case does not stem from the highest court. They consider that it was within the competence of the national judges to interpret the law and, in the absence of any decision of the Supreme Court intended to create common practice, the existence of different interpretations of the applicable legal provisions does not amount to a breach of the principle of legal certainty.

28. In respect of the decision delivered by the Supreme Court of Justice on 1 October 2003, the Government notes that it was not intended to unify the practice of the lower courts, but concerned a specific case. Nevertheless, they further draw attention to the fact that at the time the domestic law provided for a remedy in case of divergent jurisprudence, namely an appeal in the interest of law (see § 20 above).

29. The applicants disagreed with the Government's position and reiterated that opposing final decisions had been reached in cases similar to theirs.

(…)

31. The Court notes that the present case concerns a legal question affecting former employees of B. who were part of the same collective dismissal process. It accepts that the legal issue at stake was not a matter of general concern to the whole of society, such as the conflicting case-law on restitution at stake in the case of Tudor Tudor v. Romania (no. 21911/03, § 31, 24 March 2009), but affected a clearly defined category of people. However, it considers that the applicants, like any other citizen, had the right to a fair trial in the determination of their civil claims and the right to a fair trial includes the right to legal certainty. It recalls in this respect its case-law according to which the principle of legal certainty is implied in the Convention and constitutes one of the basic elements of the rule of law (see Beian (no. 1), cited above, § 39).

32. The Court considers that once a solution has been adopted by a State to regulate the collective dismissal of hundreds of persons from state-owned companies, it must be implemented with reasonable clarity and coherence in order to avoid, in so far as possible, uncertainty and ambiguity for the persons concerned by the measures of implementation. In that context, it should be stressed that uncertainty – be it legislative, administrative or arising from practices applied by the authorities – is an important factor to be taken into account in assessing the State's conduct (see Broniowski v. Poland [GC], no. 31443/96, § 151, ECHR 2004‑V; Păduraru v. Romania, no. 63252/00, § 92, ECHR 2005‑XII (extracts); and Beian v. Romania (no. 1), cited above, § 33).

33. The Court notes that the judicial decisions available in the case file and concerning the entitlement to compensatory payments concern persons in a similar situation; namely, persons who had been dismissed from different branches of the same company, before October 1999 and who had been denied by their employer the right to compensatory payments. As they were not considered by the company to have been part of a collective dismissal, the persons concerned had also not been involved in the pre-dismissal procedures. Furthermore, according to the Emergency Ordinance no. 98/1999, in order to benefit from pre-dismissal assistance, their names would have had to be provided to the agencies charged with providing these services. As it appears from the various court decisions available in the case-file, the employer did not provide the agencies with lists of the persons dismissed before October 1999.

34. The Court notes further that, while the applicants' legal action for compensatory payments was dismissed, final decisions of different county courts recognised the right to such payments to persons in similar situations. These contradictory solutions reveal an inconsistent approach of the domestic courts in interpreting the conditions set by the law for the award of compensatory payments despite similar factual situations.

35. Without deeming it appropriate to pronounce as to what the actual outcome of the applicants' lawsuit should have been (see mutatis mutandis, Vinčić and Others v. Serbia, no. 44698/06 et seq. § 56, 1 December 2009), the Court considers that this diversity of interpretation of national law by the different county courts ruling as final instances led to judicial uncertainty in the adjudication of similar civil claims.

36. The Court considers it necessary to analyse further the Government's argument that there was a mechanism in place to ensure a uniform interpretation of the applicable law. In this respect it notes that the final instance courts with jurisdiction were the county courts and, as a consequence, there was no possibility for the Supreme Court of Justice to intervene in the adjudication of the cases during the ordinary proceedings.

37. The applicants themselves applied to the Prosecutor General for leave to lodge either one of the two extraordinary appeals and both requests were refused. At the same time, a request from a different set of plaintiffs was accepted and led to a favourable solution for those concerned (see § 17 above). The decision delivered by the Supreme Court of Justice in those extraordinary proceedings concerned the particular application of law in that individual case and was not meant to settle conflicting interpretations of national law (see mutatis mutandis, Tudor Tudor, cited above, § 29). Moreover, the Court reiterates its conclusion in the case of Tudor Tudor (cited above) that where the intervention of the Supreme Court was only possible by means of an extraordinary appeal that contradicted in itself the principle of legal certainty.

The Court acknowledges that a lower court's appreciation of the facts of a case and its assessment of the evidence therein, may lead to different outcomes for parties with broadly similar grievances. Such reality does not, per se, violate the principle of legal certainty.

However, where there are divergences in the application of substantively similar legal provisions to persons in near identical groups, a problem with legal certainty does arise. Such was the situation in this case.

38. In the light of the foregoing considerations, the Court concludes that in the absence of a remedy to resolve such divergences, the inconsistent adjudication of claims brought by many persons in similar situations led to a state of uncertainty, which in turn must have reduced the public's confidence in the judiciary, such confidence clearly being one of the essential components of a State based on the rule of law (see mutatis mutandis, Vinčić, cited above, § 56). The judicial uncertainty in question has deprived the applicants of a fair hearing.

39. There has consequently been a violation of Article 6 § 1 in this connection.

40. Having regard to the above finding, the Court considers that it is not necessary to pursue the examination of the remaining complaints under Article 6 § 1 of the Convention.”

Aparte del valor jurisprudencial propio del caso, las siguientes consideraciones tienen una gran trascendencia en relación con cualquier infracción nacional del derecho a la seguridad juridica, que ya apenas se invoca – si es que no se ignora- en determinadas demandas y sentencias de las jurisdicciones internas:

1) La propia caracterización del derecho a la seguridad juridica como parte del derecho a un juicio justo.

2) La incompatibilidad de soluciones contradictorias sobre las condiciones legales de determinados derechos con dicho derecho a la seguridad jurídica.Nuestro Tribunal Constitucional, por ejemplo, solo estima una infracción del mismo, como infracción del derecho a la igualdad en la aplicación de la ley, cuando la contradicción se da entre dos sentencias emitidas por la misma “Sala y Sección “ de un Tribunal.

3) La consideración de la divergencia de interpretación de la ley por diferentes tribunales que decidan como última instancia como incompatible con el derecho a la seguridad juridica en la decision de los pleitos civiles.

4) La consideración de que cuando la intervención de un Tribunal Supremo es solo possible por medio de un recurso extraordinario sin alcance general ello contradice en sí mismo el derecho a la seguridad juridica.Con mayor motivo debería considerarse contraria a dicho derecho una limitación radical de los recusos al Tribunal Supremo por falta de cuantía o interés, en la forma por cierto contemplada en el proyecto de ley de agilización procesal actualmente en las Cortes.

5) La distinta apreciación de los hechos y pruebas por los tribunales inferiores no contradice el derecho a la seguridad, pero cuando “hay divergencias en la aplicación de sustancialmente las mismas previsiones legales a personas en grupos casi idénticos, se plantea un problema con la seguridad juridica.Esta fue la situación en el caso”

6) La confianza en el sistema judicial, claramente un componente esencial de un Estado basado en el gobierno del derecho, exige un remedio para resolver estas divergencias interpretativas legales.

La Sentencia es también importante porque rechaza la petición de daños cifrada en el importe de las indemnizaciones que los trabajadores deberían haber recibido solo porque el Codigo de Procedimiento Civil Rumano tiene un procedimiento específico para revisar las sentencias dictadas si el TEDH ha decidido que una sentencia nacional ha violado los derechos fundamentals de la Convención.En España no existe todavía una prevision similar.Solo como consecuencia de dicha previsión y del principio de subsidiariedad, considera el Tribunal que debe rechazar la petición de indemnización en este aspecto.La STEDH reconoce un daño moral de 3.000 euros a cada demandante y un derecho al reembolso de gastos de 40 euros por cada demandante.

Por ultimo, aunque el Tribunal no lo examina es destacable que el caso pudiera haberse considerado también como una infracción del derecho al disfrute pacífico de los bienes y del derecho a la igualdad en la aplicación de la ley.Los trabajadores de una empresa estatal procedente del regimen comunista habrían resultado protegidos por el derecho de propiedad.Han tenido en ello más fortuna que los del caso “Aizpurua Ortiz y otros v. España”.El Tribunal Constitucional español sigue considerando que el derecho al disfrute pacífico de los bienes frente a intromisiones no justificadas no es un derecho susceptible de amparo, tampoco cuando se invoca el artículo 1 del Protocolo 1 del Convenio Europeo suscrito por España (ver en este sentido, por todas, la reciente STC 38/2011, de 28 de Marzo)

LA DEUDA GRIEGA Y EL PENSAMIENTO POLITICO

All political thinking for years past has been vitiated in the same way. People can foresee the future only when it coincides with their own wishes, and the most grossly obvious facts can be ignored when they are unwelcome.”

– George Orwell

El cuadro y la cita proceden de

How to Fix Greece
VITO J. RACANELLI
Barron’s MAY 28, 2011
http://online.barrons.com/article/SB50001424053111903548904576343340195494116.html

y

http://www.ritholtz.com/blog/2011/05/greeces-debts-are-europes-problem/

Tambén merece la pena el análisis de John Mauldin, especialmente el de "Disfuncionalidad:tu nombre es Europa

PODERES SALVAJES

El libro (2011) de Luigi Ferrajoli tiene por subtítulo "La crisis de la democracia constitucional" y está editado por Minima Trotta.

Esta es su introducción preliminar:

"Está en curso un proceso de deconstitucionalización del sistema político italiano

(…)

Una democracia puede quebrar aun sin golpes de estado en sentido propio, si sus principios son de hecho violados o contestados sin que sus violaciones susciten rebelión o, al menos disenso. Recuérdese el último artículo de la Constitución francesa del año III: “El pueblo francés encomienda la presente constitución a la lealtad” de los poderes públicos y a la vigilancia de los padres de familia, las esposas y las madres, al afecto de los jóvenes ciudadanos, al coraje de todos los franceses”.Hoy no es posible confiar en la lealtad de los titulares de poderes de gobierno, al ser ellos mismos los promotores de la deformación constitucional. Y la vigilancia de la opinión pública decrece progresivamente, anestesiada por la propaganda.

Este debilitamiento de la dimensión constitucional de nuestra democracia se interpreta habitualmene en el debate público como el precio pagado por el reforzamiento de su dimensión política, debido a la atribución a los electores del poder de elegir en cada ocasión la coalición gobernante. En otras palabras, como una reducción y una desvalorización de la dimensión legal de la democracia en beneficio de su dimensión política y representativa, concebida, por lo demás, como el único fundamento de la legitimidad de los poderes públicos. Este trabajo tiene el fin de rebatir tal planteamiento. Pretende demostrar cómo tras el pretendido fortalecimiento de la representación política como expresión directa de la voluntada popular se oculta en realidad una deformación profunda de las instituciones representativas, responsable no solo del vaciamiento de la dimensión constitucional de la democracia, sino también de la tendencial disolución de su dimensión política y representativa. En efecto, como trataré de hacer ver, existe un nexo biunívoco entre forma representativa y dimensión constitucional de la democracia y, por los mismo, entre crisis de una y otra, hasta el punto de que hoy cabe hablar de una crisis de la democracia tout court.De la democracia constitucional, debido a la involución populista de la representación y de la falta de límites reivindicada para ésta; pero también de la democracia política, por efecto de los conflictos de intereses en el vértice del Estado y del debilitamiento de las reglas de la democracia constitucional. En resumen, los enemigos de la democracia constitucional son también los principales enemigos, disfrazados de amigos, de la democracia política.

(…)

Los actuales fenómenos de personalización, confusión y concentración de poderes y de disolución del espíritu público, en ausencia de garantías adecuadas y de anticuerpos culturales eficaces, pueden perpetuarse y reproducirse, en el nuestro como en otros países. En fin, como escribió Montesquieu, es una dato de “experiencia eterna” que los poderes, libres de límites y controles, tienen a concentrarse y acumularse en formas absolutas: a convertirse, a falta de reglas, en poderes salvajes. De aquí la necesidad no solo de defender, sino también de repensar y refundar el sistema de garantías constitucionales. En efecto, pues –es mi tesis- únicamente el reforzamiento de la democracia constitucional, a través de la introducción de nuevas garantías específicas de los derechos políticos y de la democracia representativa, permitirá salvaguardar una y otra”.

El diagnóstico serviría igualmente, con matices nacionales propios, para nuestro país y para otros países miembros de la Unión Europea.

En nuestro caso, dos garantías constitucionales recientemente afectadas han sido la del recurso de amparo, limitado con la reforma de la Ley Orgánica del Tribunal Constitucional, y la de la limitación del acceso a la casación.En realidad, ambas reformas son, a la vez, un síntoma de la crisis y, como subraya Ferrajoli, una vía hacia su acentuación por reducción de las garantías constitucionales previas.En este caso, la garantía de que las decisiones judiciales no violan derechos constitucionales procesales o sustantivos o la ley que aplican -separación de poderes-.Si bien es cierto que sus justificación se pretende amparar en la proliferación de litigios, no lo es menos que los mismos se multiplican por razones vinculadas a la falta de adecuado funcionamiento de otras grantías constitucionales y legales en perjuicio de los ciudadanos y justiciables.

Ambos problemas han sido comentados previamente aquí:

LA TRASCENDENCIA CONSTITUCIONAL COMO NUEVO REQUISITO DEL RECURSO DE AMPARO

CUANTIA LITIGIOSA Y RECURSO DE CASACION

Sobre comentarios a otros libros del citado autor italiano

¿UNA GIGANTESCA PIRAMIDE PONZI EUROPEA?

Según Mario Blejer (FT 6 de Mayo de 2011: “Europe is running a giant Ponzi scheme”), a una gigantesca pirámide de Ponzi podría asemejarse la política europea en relación con la crisis financiera y los rescates de Grecia, Irlanda y Portugal :

“ … los gobiernos europeos están considerando más conveniente posponer el día de reconocimiento y continúan arrojando dinero a los países periféricos, antes que hacer frente a la disrupción financiera doméstica. Por consiguiente, en la medida en que el dinero europeo e internacional (por medio del FMI) esté disponible el juego puede continuar.

Ello se basa en la asunción de que se trata meramente de un problema transitorio de liquidez y de que la financiación oficial contribuye a que los países afectados hagan las reformas que le permitan regresar al mercado de crédito en condiciones normales (…)

Aquí es donde la situación recuerda una pirámide o esquema de Ponzi. Algunos de los originarios tenedores de bonos están siendo pagados con los préstamos oficiales que también financian los restantes déficits primarios (el Banco Central Europeo declara ser titular del 17% de la deuda de los países afectados con un porcentaje mucho más alto recibido como colateral) . Cuando resulte que los países no pueden cumplir las condiciones de austeridad y estructurales impuestas sobre ellos, y que no pueden volver al mercado, estos préstamos serán renovados y asumidos por miembros de la eurozona y organismos internacionales (…)

La limitación no es financiera sino política. Resulta evidente que, si ello no es forzado antes por la política, el impago inevitable solo se permitirá que ocurra cuando la gran parte de la deuda europea en dificultades sea transferida del sector privado al sector público. Como en cualquier esquema piramidal, será el último tenedor del activo el que sufra la pérdida total. En este caso, serán los contribuyentes los que corran con la factura, antes que los originales tenedores de bonos que tomaron las decisiones de inversión erróneas.

¿Ello es bueno o malo?.Ello depende de cómo se calcule el valor del tiempo ganado.¿Sería una crisis bancaria actual más dañina para la economía europea que una quita futura de deuda pública?.O alternativamente, ¿es preferible reconocer ahora la realidad y aceptar una quita de la deuda a incrementar la carga de los contribuyentes futuros?.Al final es una decisión política, pero sería estimulante que se llamara a las cosas por su nombre. Los eufemismos pueden ser utilizados en el corto plazo, pero al final un esquema Ponzi se reconoce cuando persiste.”

Mario Blejer fue gobernador del Banco central de Argentina

Entre los costes del retraso no parece que deban excluirse los sociales ni, como posible consecuencia de ellos, las graves crisis políticas nacionales que desequilibren la unión de forma irreparable. La unión europea y muchas otras realidades pueden depender del “bueno o malo”.La inacción en una inaplazable disyuntiva política nacional y europea solo puede representar un grave coste. La crisis tiene dimensión europea, pero no existe política a esa escala.

MODELOS DEL CAMBIO CLIMATICO Y LA ECONOMIA MUNDIAL

MODELOS DEL CAMBIO CLIMATICO Y LA ECONOMIA MUNDIAL

Romesh Vaitilingam interviews Per Krusell for Vox

April 2011

Transcription of a VoxEU audio interview

[http://www.voxeu.org/index.php?q=node/6348]

Romesh Vaitilingam: Welcome to VOX Talks, a series of audio interviews with leading economists from around the world. My name is Romesh Vaitilingam and today's interview is with Professor Per Krusell from the Institute for International Economic Studies in Stockholm. Per and I met at the European Economic Association's annual meeting in Glasgow in August 2010, where we spoke about his research, modeling the impact of climate change on the world economy, I began by asking him how this project began.

Per Krusell: I mean, it started, I guess, because of the Stern Report, and reaction to it, or to the ongoing work, actually, by some of my colleagues in Stockholm. And, that's a group of people that mainly consists, actually, of scientists. They wanted economists in on this project. And, at the time I was a Princeton, but Torsten Persson, he asked me if I was interested in taking part. And, I think it seems like an exciting area. It seemed like it, at the time. I still think so. So, I think what's been fun for me in this project is that I'm, comparatively speaking, good at modeling, macro‑modeling. And, I think there's a great need for that in this area, and I can just, off the shelf, use my tools in this area that I think desperately needs it because I think it's a relatively recent area. Nordhaus has worked on it for a little bit more than a decade, but he's used very old methods, I think. He's done a good job, and he's a pioneer, and it's, you know, great to have his work. But, I think there's so many ways in which we can improve on his modeling of the world economy on modern macro‑tools that are, you know, being discredited on a daily basis.

You know, you don't have to like these methods for business psychoanalysis, I think, to support the methods for this use. I think it's more of macro‑growth analysis and thinking about what makes countries rich and poor. And then, the energy market and the connection to the climate system and the damages and so on.

For me, it's been very enjoyable, because we find that the returns from doing research in this area are so high, so quickly. And I think it's just because it hasn't really been populated by people like me. And, there are all these people like me who could have higher returns by doing a little bit of work in this area.

Romesh: Why do you think the climate change scientists were so keen to get an economist involved? What is the difference that economists make in the way that Stern almost revolutionized the world discussion of this?

Per: I think there are various dimensions here. One is, in general, that economists are important for getting support. More generally, I think for the climate scientists to have an impact, they have to influence economists in leading positions. And, that partly happens through us, through the academic economists. So I think that's important.

But they have a strong need on the more scientific level. They have a need for projections of energy use in the future, and what determines the oil price? And what about the different markets for energy? And, you know, how does that work? How do we think about it in a systematic way?

So, actually in their models of world temperature, there is a key input, which is the world's use of fossil fuel. And, they just take that as given and they ask economists, maybe, "What do you think it will be?" But, they realize that it's really important to think about that more carefully. And also, obviously the two systems interact. Economy influences the climate. The climate influences the economy back. And, they think about it the right way, that they need some of our knowledge.

Then, I think, they don't necessarily realize that we're also important for systematic welfare evaluation, because they think they can evaluate welfare just based on, you know, I don't like heating, or I like heating. But, what we do is we translate it into consumer welfare with our standard methods. I don't think they appreciate that that's a useful method.

But, we've found that when we have educated our meteorologists and so on, that they really started respecting what we do, and they're understanding us much better than, I think, before. So, I think it has side effects, in that, these scientists that we talk to actually understand that we are very serious and that we're not... Well, you know, economists are not always the most popular people. So, in that sense, I think they're getting more out of us than they thought in the first place.

Romesh: Can you explain the significance in your modeling of the regional differentiation, how you have different impacts around the world? Some parts of the world perhaps even benefiting from climate change?

Romesh: Right, exactly. And, I mean, that's an issue that comes up a lot in discussion. "Well, you know, isn't it better with a little bit hotter climate?" And it is better in some places, but it could be quite disastrous in other places. And, I think they have a strong interest. The scientists have a strong interest in figuring out damages in different parts of the world, I think because they are concerned with development and with Bangladesh being hit hard by flooding, et cetera. So, we felt a need to develop something much more regional than Nordhaus's model. Nordhaus has a big model with eight regions. The world is divided up based on some different characteristics. Some are geographical, but some are rich and poor.

We just divide the globe up into small cells, one by one degree or five by five degree on the map. And, we'll be able to, we think, make predictions as to how different parts of the world are likely to be affected by climate change.

Obviously, we need different methods or different for getting this to work, but I think that one of the main issues here is distribution of welfare across the world. So, it's somehow a part of development economics as well.

Romesh: What do we know, so far, about that in terms of the differential impacts? There seems to be a sense that it is actually the poor countries that are more the victims of climate change than the rich countries.

Per: Right. Yes, so we haven't reached the point where we have our independent conclusions on this. But the historical data that people have studied suggests that, for whatever reason... What people do in, like in the work by Dell, Jones and Olken, is simply run regressions, where you see whether output growth is helped or hurt by changes in temperature, or by the level of temperature. They find significant effects in the poor countries, and quite large effects as well. So it seems that it's in the data, and we have to explore it further and look at possible ways of adapting to climate change, etc., in those poor countries.

An interesting aspect is that if you compute the costs, and you sum them up, the sum isn't necessarily so big. Because if you think about growth effects in poor countries, they may be large, but they are so poor that the numbers are not so big if you add them up. So actually, the global sum of the costs doesn't seem so high. It would seem easy for the rich countries to compensate. So, one of the big challenges for politicians is to try to do that.

But until we have good ways of compensating, we really have to study the poor countries because the effects there are large, and they are close to the point where people die if temperature goes up by three more degrees. I think it's right now. I think it's super important, but it also seems like there could be policy change that allowed some of these countries to cope much better. I think the kind of work we do will help in convincing policy‑makers that it is really important.

Romesh: How does your analysis think about the impact of sudden unexpected crises or unexpected disasters? In a way, in the economic world, we've had the financial crisis, but we've had things like big hurricanes devastating the Haitian economy, floods affecting 20 million people in Pakistan recently. How does it think about impacts of sudden weather events that might be the result of climate change?

Per: The kind of models we use are not detailed enough on the timescale, actually, so we measure damages as average damages over relatively long periods. A year would be absolutely the shortest, but I think our main models will have one time period be five or ten years. I think that's something that requires a separate type of economic analysis. I don't think we'll provide that, at least not in the short run, detailed analysis of that. But that's an important question.
Unfortunately, what we do... We have models whose horizon is more like 50 years, and think about what has to happen with policies over the next 50 years, and 100 years too, for that matter. But 10, 20, 30,... I don't have a good answer to that, unfortunately.

Romesh: Well, perhaps finally, we can go back to the policy issue. We talked about policies over periods of 10, 20, 50, 100 years. What is the range? How do you describe the taxonomy of different policies that national and international policy‑makers might implement?

Per: Well, we have focused mainly on taxes on fossil fuel use. It's the most obvious instrument. I think, of course, there the competitor, cap-and-trade. Have caps, quantity restrictions on how people trade in emission permits. I don't have a strong view on whether one is better than the other. I think the arguments that are put forth in favor of one as opposed to the other are more of a political nature, in the sense that some are easier to implement politically. I know Mankiw thinks that taxes are good because that brings in revenue, so that one can lower taxes on labor income, for example, because he likes such a policy.

I can sympathize with that or not. But in some basic economic sense, they are very similar, so we essentially think about trying to have world taxation—and it has to be pretty much used everywhere, so it's not enough that a few rich countries use taxes. It has to be used everywhere, so the issue is how high these taxes have to be do the right thing about the climate. That's where we're at right now.

I think one aspect of policy that we are not so good at yet, but some other people have worked on more, like Philip Aghion and company, is exactly how taxation interacts with support for alternative energy technology. But that's an important area, too, of policy. It's not clear how much they interact. There are arguments back and forth ‑- the green paradox.

But for the moment, I think we just look at the most obvious, easiest to use policy in principle. If you could get politicians to just implement it, because it's a pretty easy thing to do. Our main questions are how high does it have to be.

Actually, the stuff we presented yesterday, which was based not on this multi‑regional model, but a one-region model, suggests that Stern's numbers were at a pretty reasonable level. You don't have to assume extreme discount factors. So the numbers are pretty big. You need pretty high taxes, and you need to use high taxes now. That's what we find so far. But I have to say it's preliminary, because we haven't been working on this for very long.

Romesh: How does the research program develop from here, in terms of building the model and pulling out the answer?

Per: Well, we keep plugging on main aspects of the modeling, trying to understand energy use in the past, to be able to predict it in the future on a global scale. I think that's hard. Trying to understand what determines oil prices is hard. I think we're doing this work on multiple fronts at the same time, a bunch of people. We're hoping more people will be interested and just do work in other places on these same issues. I think competition would be great in this field. It will push the frontier so much faster.

We are basically doing a bunch of parallel projects, and they involve everything from relatively pure empirical studies to theory to solving computational challenges. I mean numerical methods. I couldn't say I'm working on something very specific. Right now we have all these different aspects, I think are all interesting and fun.

Romesh: Per Krusell, thank you very much.

Per: Thank you.

© voxEU.org

MODELLING CLIMATE CHANGE AND THE WORLD ECONOMY