Joseph Stiglitz: the "extraordinary risk" of European austerity policies

By and

Back in September 2010, former World Bank chief economist Joseph Stiglitz told Mediapart in a series of video interviews why austerity plans were "counter-productive", threatening a "double-dip recession", and warned how the flawed and derided financial practices that led to the 2008 crash were back in business. "It is conceivable that one or more countries would either default or drop the euro", said the 2001 winner of Nobel Prize in Economics. Why was no-one listening?

This article is freely available. Check out our subscription offers. Subscribe

Joseph Stiglitz, former World Bank chief economist (1997-2000), explains to Mediapart why austerity is "a counter-productive strategy" that could trigger a double-dip recession in Europe. "We shouldn't be focusing on the deficit today, tomorrow or next year, we should be focusing on the deficit five years down the line", Stiglitz says. According to the 2001 winner of Nobel Prize in Economics, Europe's debt crisis is far from over, because the European Union included a "fundamental institutional flaw" in the creation of the euro ten years ago. "It is conceivable that one or more countries would either default or drop the euro", he says, however unlikely that may appear.

1. Stiglitz and austerity in Europe

 

2. Stiglitz and the euro crisis

 

Extend your reading on Mediapart Unlimited access to the Journal free contribution in the Club Subscribe