Progressive Economy newsletter - N°2 - 2017

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Newsletter - 01 - 2017 - Progressive Economy
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Stiglitz’ 5 tips to end the time of neoliberalism

Stiglitz’ 5 tips to end the time of neoliberalism

The set of ideas that came to dominate politics since the 1980’s has been called neoliberalism. By boosting inequality and a dependency on finance, the ideas of neoliberalism fed directly into the crash of 2008. The ideas have now been shown to be wrong, to have failed for over a third of a century. It’s time for us to think about alternatives and Professor Joseph Stiglitz provides us with five tips to overcome neoliberalism:

1. A proper balance between government and market

1. A proper balance between government and market

There needs to be an appropriate balance between government and market. When an economy is weak, as it has been in recent years, there is a need for governments to invest in people, technology and infrastructure. This not only grows the economy today, but also in the future.

2. An economy is not a family household

2. An economy is not a family household

An economy is different from a family. In an economy, when the government spends more and invests in the economy, that money circulates, and recirculates again and again. So not only does it create jobs once: the investment creates jobs multiple times.

3. Austerity is bad for the economy

3. Austerity is bad for the economy

Austerity has not only damaged the European economies, but actually threatens future growth. For instance, when you have young people not learning, or in jobs inappropriate to their skills, they’re not increasing their human capital in the way they could be. Without that human capital, future economic growth will be lower than it could have been.

4. Rewrite the rules of the economy

4. Rewrite the rules of the economy

There is a need for a break with the past. With neoliberalism discredited and austerity failed, we need to rewrite the rules of the economy once again. But this time in the right way. We need rules that focus on long-term economic growth, and the only kind of sustainable prosperity is shared prosperity.

5. Public investments are the way forward

5. Public investments are the way forward

There’s a long list of investments that governments could and should be making. There is strengthening infrastructure, such as transport and communications; there is investment in education; there is investment in families, particularly putting measures in place that free women from having to make the choice between raising a family and work. If that is done, it increases the labour supply. And that is not only better for society – it’s better for the economy.

Wanna read more? Check out the whole article here
Stiglitz, J. (07.06.2017): “Austerity has strangled Britain. Only Labour will consign it to history”. The Guardian.
Public hearing on Sustainable Finance - 18th July 2017

Public hearing on Sustainable Finance - 18th July 2017

Mobilising finance for more sustainable investments is essential to translate the European Union's climate change, environmental and sustainable policy goals into tangible results. The current financial framework needs to be reformed to better align capital flows with a pathway to sustainable development and growth.

At the end of 2016, the European Commission established a High-Level Expert Group on Sustainable Finance to help develop a comprehensive, overarching EU strategy on sustainable finance. After six months of intensive work, the Expert Group has summarized first results and policy options in its Interim Report which will be published on 10 July 2017.

The Public Hearing, organised by the European Commission, will allow stakeholders to provide feedback on barriers to and possible solutions for increasing sustainable finance, and ways to establish a more sustainable financial system.

New note from EPSC on sustainable finance

New note from EPSC on sustainable finance

The European Political Strategy Centre has published a new Strategic Note entitled ‘Financing Sustainability: Triggering Investments for the Clean Economy’.

Following the United States’ decision to withdraw from the 2015 Paris Agreement on climate change, the EU has a unique window of opportunity to take the global lead on sustainable finance and position itself as the investment destination for low-carbon technologies.

Seizing this opportunity will be key to driving job creation and ensuring the EU’s long-term competitiveness. However, this will require a fundamental remodelling of the financial system. Obstacles and market failures throughout the investment chain must be addressed to achieve a more future-friendly capital allocation in order to finance the economy of tomorrow.

Group of the Progressive Alliance of Socialists & Democrats in the European Parliament
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