Peterson Institute for International Economics

Roubini Topic Archive: Fiscal Policy

  • The Political Redefinition of Europe

    Opening remarks at the Swedish Financial Markets Committee’s (FMK) Conference on “The European Parliament and the Financial Markets,” Stockholm, June 8, 2012 For the past few years, headlines in Europe have been dominated by the financial and economic developments of the crisis, first in the banking system and then in sovereign debt markets. Throughout this period […]

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  • Will the French Elections Derail the Fiscal Compact in Europe?

    On March 2, 25 European Union members signed their long-discussed fiscal compact, the treaty committing them to balance their budgets in the future, paving the way for national ratification of the compact before January 2013. Most analysts expect the compact to be ratified in most countries. But a few signs of doubt have emerged over […]

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  • Lessons for Europe’s Fiscal Union from US Federalism

    The euro area crisis and debate over fiscal reform have led many observers to pray for salvation by a modern, European version of Alexander Hamilton. By this they generally mean someone capable of leading a movement for a robust fiscal union and implementing this vision (see for example McKinnon 2011). Europe has instead, they lament, […]

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  • The Last Bullet

    US policymakers are running out of options to solve our massive unemployment problem and get the economy growing again. The Administration’s jobs bill faces resistance in Congress. The best option that can be implemented without a vote of Congress is to work through the market that started this mess in the first place—housing. The Administration […]

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  • Stop Sticking Our Heads in the Sand! A Plan for Action on Jobs

    Despite the claim that previous weeks’  jobs numbers were “better than expected,” they were in fact an abysmal indictment of US economic policy over the past two years. The unemployment rate has remained near or above 9 percent for 28 consecutive months, a policy failure not seen since the Great Depression of the 1930s. Unfortunately, […]

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  • Can a Debt Ceiling Be Sensible? The Case of Denmark II

    In response to many inquiries prompted by my previous posting about the debt ceiling in Denmark, I thought it sensible to add a few more details about the origins of the Danish debt ceiling and how and why it has been changed over the years. The Danish debt ceiling was first instituted by law in […]

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  • Tax Reform and Consumption-Based Tax Systems

    Congressional testimony submitted to the US House Ways and Means Committee hearing on “Tax Reform and Consumption-based Tax Systems” July 26, 2011 This testimony draws on joint work with Peter Boone and James Kwak. Underlined text indicates links to supplementary material; please see also, where we also provide daily updates and detailed policy assessments […]

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  • The Shadow Cast by U.S. Debt

    Carmen M. Reinhart discusses how history teaches that large public and private debt impedes economic growth, a lesson that the United States must heed in the years ahead.

    Edited transcript, recorded February 18, 2011. © Peterson Institute for International Economics. 

    Steve Weisman: It’s budget season, and Washington is dealing with steps to curb the American overhang of debt. This is Steve Weisman at the Peterson Institute for International Economics and with pleasure I welcome Carmen Reinhart, new senior fellow here at the Institute, for her first Peterson Perspectives interview. Thanks for joining me, Carmen.

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  • Let Us Welcome the Eurozone’s “New Normal”

    In recent days the eurozone has reentered the headlines (in USA Today, the Financial Times, and the Wall Street Journal among others) amid fears of another round in the continent’s sovereign debt crisis and rising peripheral bond spreads. Yet contrary to the tone of some commentary, this is excellent news. It should be welcomed by anyone interested in the long-term economic health of the eurozone. It means also that financial markets are finally policing the economic policies of troubled eurozone members and punishing the laggards in real time.

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  • The Sun Is Rising in the East

    What hand wringing there has been recently on both sides of the Atlantic as the major European economies pursue austerity in their budgets and social programs! But is it not overdone? Europeans and Americans need only look east—to the European Union’s new eastern members—to see that austerity can deliver growth and improve the efficiency of the European economic and social systems.

    Latvia, Lithuania, Estonia, Hungary, Romania, and Bulgaria were hit by profound financial crisis in late 2008, but their cure has proven effective. Almost all East European economies are growing and their public sectors have become leaner and more efficient.

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