Backgrounder posted July 24, 2012
What Debt Crisis? A Default Primer for Governments
A government that systematically finances spending through unsustainable levels of borrowing eventually finds itself in a crisis. The crisis is often triggered when economic growth slows or interest rates rise, leading to a vicious cycle of larger and larger interest payments. Often, such crises result in default on government…
Issue Brief posted May 9, 2012
Germany’s Economy Is Badly Exposed
As the European economic crisis once again comes to a boil, many wonder how the Europeans put themselves in such hot water. This is a political crisis on top of an unemployment crisis, which bubbles on top of a fiscal crisis, underneath which is the critical element of an unsustainable imbalance in trade flows. While the trade imbalances within Europe have many causes,…
Testimony posted September 23, 2011
The European Financial and Economic Crisis: Origins, Taxonomy, and Implications for the U.S. Economy
Chairman Warner, Ranking Member Johanns, thank you for the opportunity to testify today. My name is J.D. Foster. I am the Norman B. Ture Senior Fellow at The Heritage Foundation. The views I express in this testimony are my own, and should not be construed as representing any official position of The Heritage Foundation.
The European Economic Crisis is no accident. It is…
WebMemo posted May 20, 2011
President Obama Visits the Irish Financial Crisis
When President Obama visits Ireland on May 23–24, he is expected to visit Moneygall in County Offaly, the ancestral home of his mother’s family. While finding Irish ancestors is a favorite electoral sport of American leaders, the President would be better advised to spend his time studying the Irish financial crisis, which has important lessons for America.
WebMemo posted October 14, 2010
The Obama Administration Must Push for Macedonia’s Accession to NATO at the Lisbon Summit
On November 19, NATO leaders will meet in Lisbon for a formal heads-of-state summit. The dominant issue for the United States will be the adoption of NATO’s new Strategic Concept, the first of the new millennium. However, the Obama Administration should also throw its weight behind further expansion of the alliance, especially Macedonia’s accession.
Special Report posted July 15, 2010
Europe: What Future?
Abstract: The pretense that the European Union is successful and stable—and that the euro is a successful and stable currency—has been exploded by events surrounding the financial bailout of Greece. No one knows where the contagion will spread or how it may end. The world’s financial markets have occasionally teetered on the edge of panic. But the full implications of…
Backgrounder posted June 22, 2010
What the EU Bailout Means for the U.S.
Abstract: Long-run federal spending is wildly unsustainable, as almost everyone from right to left agrees. Under President Obama, this long-run problem has been married to an almost equally unsustainable short-run problem of deficit spending. Thus, to watch developments in Europe today is to peer through a clear window into America’s own future. As the nation runs…
WebMemo posted May 6, 2010
Five Reasons Not to Support a Bailout of Greece
This weekend, the Eurozone members and the International Monetary Fund (IMF) proposed a €110 billion ($140 billion) rescue package for the struggling Greek economy. In exchange for imposing tough austerity measures—including a three-year public sector pay freeze, an increase in taxes, and a liberalization of labor laws—Eurozone countries will provide €80 billion in…