The International Economy

Daily provides news, commentary, and research on international economics. The source covers global financial policy, trends, and international law.

Articles from Vol. 25, No. 1, Winter

A Dangerous Age of Political Discontinuity
The G-20 policymaking community is in a situation reminiscent of the old joke about Mary Todd Lincoln: "Other than the disruption from the intruder, how did you like the play, Mrs. Lincoln?" Other than completely missing the global political dynamic...
A Global Growth Bargain: The West's Only Hope
U.S. President Barack Obama caught the imagination of the world when he talked recently of a new "Sputnik moment." He outlined a bold plan for improving education, infrastructure, and technology, and vividly compared the resolve required to put a man...
America's Ungovernable Budget: A Policy at War with Itself
The heart of any government is found in its budget. Politicians can make endless promises, but if the budget doesn't add up, politics is little more than mere words. The United States is now caught in such a bind. In his recent State of the Union...
Angela Merkel's Nightmare: The Markets Test the German Chancellor's Approach of Trial-and-Error. Is There an End Game in Sight?
As we go to press, German Chancellor Angela Merkel continues to display her characteristic political technique, a mixture of trial-and-error with "unilateral instincts," plus a hefty dose of nicht regieren, or non-governing. But sitting things out...
Europe's Default in Credibility: A Cautionary Tale of Broken Promises, Misled Markets, and a Loss Economically of Simple Common Sense
Once, the smart money was betting on a new economic geography where nations were united in regional alliances to share markets and monies. Now the Euro-Union's scramble to contain a self-inflicted debt crisis provides a cautionary tale of what happens...
Forty Years of Folly the Failure of U.S. Energy Policy
Richard Nixon sent the first presidential message on energy policy to Congress in 1971. He began by explaining that, throughout history, the United States had always been able to count on bountiful energy, and then warned that "the assumption that...
How to Avoid a Eurozone Breakup: Solve Two Key Problems
It has been said that the eurozone needs a new idea to avoid an eventual breakup. With Irish fiscal consolidation efforts resulting in larger budget deficits, smaller GDE higher bond yields, and more onerous credit default swap spreads, it is obvious...
Is Capitol Hill's Coming Anti-China Legislation Now Veto-Proof? TIE Asked One of Washington's Premier U.S.-China Political Analysts
The title was the "homework assignment" from my guru on international economics, David Smick, and I frankly delayed until the very last second, and for once, we were right. The day we put pen to paper, the chief sponsors of last year's successful House-passed...
Larry Summers Exit Interview
TIE: Let's start with China. The Chinese government is hinting that it plans to spend another $1.5 billion on new technologies. Housing and retail spending, the preoccupations in the United States, are not part of that spending. In the meantime, China's...
QE2 Craziness: The Missing Logic of This Strange Approach
Imagine that you get in the shower, turn on the water, and nothing comes out. You call a plumber, who tells you that there are holes in the pipes, and that it will cost you $1,000 to repair the holes. You tell him to turn up the water pressure instead....
The Cusp of Worldwide Inflation: How the Federal Reserve Is Making the Global Economy Less Stable
What do the years 1971, 2003, and 2010 have in common? In each case, an easy U.S. monetary policy was accompanied by a weakening dollar-as with the dramatic Nixon shock of August 1971 when the other industrial countries were all forced to appreciate...
The New Politics of American Trade: The Remaking of the Trade Debate
For many years, the U.S. debate over trade has been a little like a sixth-grade dance. Proponents from business, academia, and government squirm on one side of the room. Meanwhile, opponents--members of labor unions, civil society groups, academics,...
The Year of the Sovereign Debt Crisis
TIE ASKED a number of top thinkers to focus on the outlook for sovereign debt. How likely are countries in the eurozone's periphery (Greece, Ireland, Portugal, and Spain) to default outright or face significant "haircuts" on their sovereign debt over...
Thinking the Unthinkable: The Eurozone May Not Be Viable
When Greece was bailed out by a joint eurozone-IMF rescue package back in May, it was clear that the deal had bought only a temporary respite. Now the other shoe has dropped. With Ireland's troubles threatening to spill over to Portugal, Spain, and...
Washington-Beijing Currency Friction: The Latest Flash Points in the U.S. Congress
While China's trade surplus with the United States has ballooned in the last two decades, the United States and China have had a growing list of bilateral trade disputes ranging from restrictions on exports of rare earth metals to Chinese subsidies...
Why a Second Bretton Woods Won't Work: The World Economy's Dire Situation Can't Be Fixed with an International Agreement
Does the world need a new Bretton Woods meeting, as David Smick suggested in the previous issue of The International Economy? Despite the Davos hyper-optimism, the world is in a dire state and certainly needs something. But a new global monetary system...