Crashed
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53. B. Protess and P. Eavis, “At the Finish Line on the Volcker Rule,” New York Times, December 10, 2013.
54. PWC, “Volcker Rule Clarity: Waiting for Godot,” May 2014, http://www.pwc.com/us/en/financial-services/regulatory-services/publications/volcker-rule-clarity-waiting-for-godot.html.
55. B. Protess, “Jamie Dimon Shows Some Love for Volcker Rule,” New York Times, May 21, 2012.
56. P. Clement, “The Term ‘Macroprudential’: Origins and Evolution 1,” BIS Quarterly Review, 2010, 59.
57. D. Skeel, The New Financial Deal: Understanding the Dodd-Frank Act and Its (Unintended) Consequences (Hoboken, NJ: Wiley, 2010).
58. Federal Reserve, “The Supervisory Capital Assessment Program, May 2009, https://www.federalreserve.gov/newsevents/files/bcreg20090507a1.pdf.
59. Federal Reserve, “Dodd-Frank Act Stress Test 2013: Supervisory Stress Test Methodology and Results,” March 28, 2013, https://www.federalreserve.gov/bankinforeg/stress-tests/appendix-b.htm.
60. “Rules and Regulations,” Federal Register 76, no. 231 (December 1, 2011), https://www.gpo.gov/fdsys/pkg/FR-2011-12-01/pdf/2011-30665.pdf.
61. Federal Reserve, “Federal Reserve Board Issues Final Rule on Annual Capital Plans, Launches 2012 Review,” https://www.federalreserve.gov/newsevents/pressreleases/bcreg20111122a.htm.
62. P. Jenkins and P. J. Davies, “Thirty Financial Groups on Systemic Risk List,” Financial Times, November 30, 2009.
63. See the collective letter “Healthy Banking System Is the Goal, Not Profitable Banks,” Financial Times, November 8, 2010; and A. Admati and M. Hellwig, The Bankers’ New Clothes (Princeton, NJ: Princeton University Press, 2013).
64. IIF, “Interim Report on the Cumulative Impact on the Global Economy of Proposed Changes in the Banking Regulatory Framework Institute of International Finance,” June 2010.
65. Bair, Bull by the Horns, Kindle location 4731–4748.
66. FSB, “Policy Measures to Address Systemically Important Financial Institutions,” November 4, 2011.
67. The High Level Group on Financial Supervision in the EU chaired by Jacques de Larosière, Report, February 25, 2009, http://ec.europa.eu/internal_market/finances/docs/de_larosiere_report_en.pdf.
68. A point I owe to Shahin Vallée.
69. M. Goldstein and N. Véron, “Too Big to Fail: The Transatlantic Debate” (Bruegel working paper 2011/03, 2011).
70. A. S. Posen and N. Véron, “A Solution for Europe’s Banking Problem,” Bruegel Policy Brief (2009).
71. IMF, Global Financial Stability Report (April 2009).
72. “Bafin beziffert Kreditrisiken auf 816 Milliarden Euro,” Spiegel, April 24, 2009.
73. Eichengreen, Hall of Mirrors, 323.
74. Geithner, Stress Test, 425–426.
CHAPTER 14: GREECE 2010: EXTEND AND PRETEND
1. In full agreement with Sandbu, Europe’s Orphan; E. Jones, “The Forgotten Financial Union: How You Can Have a Euro Crisis Without a Euro,” in The Future of the Euro, ed. M. Matthijs and M. Blyth (New York: Oxford University Press, 2015); and D. Mabbett and W. Schelkle, “What Difference Does Euro Membership Make to Stabilization? The Political Economy of International Monetary Systems Revisited,” Review of International Political Economy 22.3 (2015), 508–534.
2. J. M. Brown, “Things Fall Apart,” Financial Times, January 15, 2009; and C. Lapavitsas et al., Crisis in the Eurozone (London: Verso, 2012), 58.
3. Z. Darvas, “The EU’s Role in Supporting Crisis-Hit Countries in Central and Eastern Europe,” Bruegel Policy Contribution (December 17, 2009).
4. S. Kalyvas, Modern Greece: What Everyone Needs to Know (Oxford: Oxford University Press, 2015).
5. G. Papaconstantinou, Game Over: The Inside Story of the Greek Crisis (Athens: George Papaconstantinou, 2016).
6. On the politics of creditor-led, as opposed to debtor-led, default, see Lapavistas et al., Crisis in the Eurozone, 126–135.
7. M. Walker, C. Forelle and B. Blackstone, “On the Secret Committee to Save the Euro, a Dangerous Divide,” Wall Street Journal, September 24, 2010.
8. Papaconstantinou, Game Over.
9. V. Acharya and S. Steffen, “The Banking Crisis as a Giant Carry Trade Gone Wrong,” VoxEU, May 23, 2013.
10. S. Wagstyl, “Greeks Search for Hint of Daylight Between Schäuble and Merkel,” Financial Times, February 19, 2015.
11. For an interpretation that sees it as the key to the entire policy of Merkel’s government, see H. Thompson, “Germany and the Euro-Zone Crisis: The European Reformation of the German Banking Crisis and the Future of the Euro,” New Political Economy 20, no. 6 (2015), 851–870.
12. B. Benoit and T. Barber, “Germany Ready to Help Eurozone Members,” Financial Times, February 18, 2009.
13. T. Koukakis, “Josef Ackermann: The Secret 2010 Financial Support Plan for Greece and Why It Was Sunk,” http://www.tovima.gr/en/article/?aid=639539.
14. R. Zohlnhöfer and T. Saalfeld, eds., Politik im Schatten der Krise. Eine Bilanz der Regierung Merkel 2009–2013 (Wiesbaden: Springer VS, 2015).
15. A. Tooze, “After the Wars,” review of The Age of Catastrophe: A History of the West 1914–45, by Heinrich August Winkler, London Review of Books 37.22 (2015), 15–17, December 7, 2017, https://www.lrb.co.uk/v37/n22/adam-tooze/after-the-wars.
16. For the quote see I. Traynor, “Angela Merkel Dashes Greek Hopes of Rescue Bid,” Guardian, February 11, 2010.
17. BVerfG, Judgment of the Second Senate of June 30, 2009—2 BvE 2/08—paras. 1–421.
18. “Merkel sagt Griechenland Milliarden-Hilfe zu’,” Die Welt, April 26, 2010; and “Union will Bankenbeteiligung prüfen,” Die Zeit, April 27, 2010.
19. J. Schönenborn, “Griechenland-Hilfe nur mit Bankenbeteiligung,” April 4, 2010, ARD-DeutschlandTrend Mai 2010, www.tageschau.de.
20. Bund der Steuerzahler, “Keine Steuerzahlergarantien ohne Bankenbeteiligung,” May 5, 2010, https://www.steuerzahler.de/.
21. W. Schäuble, “Why Europe’s Monetary Union Faces Its Biggest Crisis,” Financial Times, March 11, 2010; “Proposal for European Monetary Fund Wins EU Support,” Spiegel Online, March 8, 2010; and “Why Is Germany Talking About a European Monetary Fund?,” Economist, March 9, 2010.
22. The second edition of the proposal from May 2010 is available at https://www.ceps.eu/system/files/book/2010/02/Nopercent20202percent20EMFpercent20e-versionpercent20updatepercent2017percent20May.pdf.
23. M. Feldenkirchen, C. Reiermann, M. Sauga and H.-J. Schlamp, “Merkel Takes On the EU and Her Own Finance Minister,” Spiegel Online, March 22, 2010.
24. “Issing zur Lage Griechenlands: IWF-Hilfe ist die einzige Alternative,” February 10, 2010, www.tagesschau.de; and “Man muss den Griechen auf die Finger schauen,” March 2, 2010, www.deutschlandfunkkultur.de.
25. Blustein, Laid Low, 26–31.
26. IMF Country Report 13/156, May 20, 2013, written up dramatically by A. Evans-Pritchard, “IMF Admits Disastrous Love Affair with the Euro, Apologises for the Immolation of Greece,” Telegraph, July 28, 2016.
27. “EZB warnt vor IWF-Hilfen für Griechenland,” FAZ, March 24, 2010.
28. Papaconstantinou, Game Over, Kindle locations 1465–1470.
29. C. Volkery, “Merkel’s Risky Hand of Brussels Poker,” Spiegel Online, March 26, 2010; and “Deutschland hilft den Griechen, wenn der IWF hilft,” FAZ, March 25, 2010.
30. Gabor, “The Power of Collateral,” 23.
31. D. Gabor and C. Ban, “Banking on Bonds: The New Links Between States and Markets,” Journal of Common Market Studies 54.3 (2016), 617–635.
32. For a summary of the argument, see the case brought against the ECB in 2015 to the German supreme court “Verfassungsbeschwerde,” October 22, 2015, https://www.jura.uni-freiburg.de/de/institute/ioeffr3/forschung/papers/murswiek/verfassungsbeschwerde-qe-anleihenkaeufe-ga
uweiler.pdf.
33. Gammelin and Löw, Europas Strippenzieher, 70.
34. Papaconstantinou, Game Over, Kindle locations 1529–1536.
35. J. White, “Emergency Europe,” Political Studies 63.2 (2015), 300–318.
36. A. Evans-Pritchard, “Europe Agrees IMF-EU Rescue for Greece,” Telegraph, March 25, 2010.
37. Papaconstantinou, Game Over, Kindle location 1677.
38. “Irish Deficit Balloons After New Bank Bail-Out,” BBC News, September 30, 2010.
39. H. Smith, “Super-Wealthy Investors Move Billions out of Greece,” Guardian, February 6, 2010; and F. Batzoglou, “Anxious Greeks Emptying Their Bank Accounts,” Spiegel Online, December 6, 2011.
40. “Euro Zone Readies Giant Rescue Package for Greece,” Reuters, April 11, 2010.
41. Evans-Pritchard, “Europe Agrees IMF-EU Rescue for Greece.”
42. T. Barber, “Saving the Euro: Dinner on the Edge of the Abyss,” Financial Times, April 22, 2010.
43. Bundesfinanzministerium, “Chronology: Stabilisation of the Economic and Monetary Union,” http://www.bundesfinanzministerium.de/Content/EN/Standardartikel/Topics/Europe/Articles/2010-06-04-Chronologie-Euro-Stabilisierung.html?__act=renderPdf&__iDocId=199342.
44. K. Connolly, “Greek Debt Crisis: IMF Chief to Woo Germany over Bailout Deal,” Guardian, April 28, 2010.
45. “Transcript of Statements to the Media by Angela Merkel and Strauss-Kahn in Berlin,” April 28, 2010, https://www.imf.org/en/News/Articles/2015/09/28/04/54/tr042810.
46. Bastasin, Saving Europe, 203.
47. J. Pisani-Ferry, “Tim Geithner and Europe’s Phone Number,” Bruegel (blog), February 4, 2013.
48. Papaconstantinou, Game Over, Kindle locations 2186–2188.
49. “Regierungserklärung von Bundeskanzlerin Merkel zu den Hilfen für Griechenland,” May 5, 2010, https://www.bundesregierung.de/ContentArchiv/DE/Archiv17/Regierungserklaerung/2010/2010-05-05-merkel-erklaerung-griechenland.html. For the wider implications of TINA see A. Séville, “There Is No Alternative,” Politik zwischen Demokratie und Sachzwang (Frankfurt: Campus, 2017).
50. “Deaths Place Greece on ‘Edge of Abyss,’” May 6, 2010, www.ekathimerini.com.
51. Gabor, “The Power of Collateral,” 25.
52. “Findings Regarding the Market Events of May 6, 2010,” Report of the staffs of the CTFC and SEC to the Joint Advisory Committee on Emerging Regulatory Issues, http://www.sec.gov/news/studies/2010/marketevents-report.pdf.
53. “Preliminary Findings Regarding the Market Events of May 6, 2010,” Report of the staffs of the CFTC and SEC to the Joint Advisory Committee on Emerging Regulatory Issues, https://www.sec.gov/sec-cftc-prelimreport.pdf.
54. Bastasin, Saving Europe, 202.
55. For this and the following see T. Barber, “Saving the Euro: Dinner on the Edge of the Abyss,” Financial Times, April 22, 2010.
56. Barber, “Saving the Euro.”
57. Bernanke, Courage to Act, 481. Bernanke held a private briefing of the Senate Banking Committee to ensure there was no negative reaction.
58. Gammelin and R. Löw, Europas Strippenzieher, 75–86.
59. Bastasin, Saving Europe, 214–215.
60. Bastasin, Saving Europe, 218; Papaconstantinou, Game Over, Kindle location 2707.
61. The IMF’s own devastating postmortem is IEO, The IMF and the Crises in Greece, Ireland, and Portugal (Washington, DC: IMF, 2016), 15–18.
62. Blustein, Laid Low, 136.
63. M. Blyth, Austerity: The History of a Dangerous Idea (Oxford: Oxford University Press, 2013), 73.
64. “John Lipsky Biographical Information,” https://www.imf.org/external/np/omd/bios/jl.htm.
65. Blustein, Laid Low, 64.
66. Ibid., 139; and IMF, Greece: Staff Report on Request for Stand-By Arrangement (IMF Country Report No. 10/110, 2010).
CHAPTER 15: A TIME OF DEBT
1. For this and the following, see http://www.foxnews.com/story/2010/02/12/glenn-beck-is-us-doomed-to-follow-greece-into-crisis.html.
2. C. M. Reinhart and K. Rogoff, This Time Is Different, Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, 2009); and C. M. Reinhart and K. S. Rogoff, “Growth in a Time of Debt” (NBER Working Paper 15639, 2010).
3. J. Cassidy, “The Reinhart and Rogoff Controversy: A Summing Up,” New Yorker, April 26, 2013.
4. C. Reinhart and K. Rogoff, “Why We Should Expect Low Growth Amid Debt,” Financial Times, January 28, 2010.
5. “Germans Say Euro Zone May Have to Expel Greece: Poll,” Reuters, February 14, 2010.
6. Irwin, The Alchemists, 237–238.
7. G. Osborne, “The Threat of Rising Interest Rates Is a Greek Tragedy We Must Avoid,” Telegraph, December 21, 2009.
8. P. Habbard, “The Return of the Bond Vigilantes,” March 7, 2012, http://www.ituc-csi.org/IMG/pdf/1203t_bond.pdf; and S. Johnson, “Bond Fund Managers Brave ‘The Ring of Fire,’” Financial Times, February 7, 2010.
9. A. Stratton, “Top Economists Attack Labour Plan to Tackle Britain’s Budget Deficit,” Guardian, February 14, 2010.
10. Lord Skidelsky et al., “Letter: First Priority Must Be to Restore Robust Growth,” Financial Times, February 18, 2010.
11. P. Wintour, “Mervyn King Shaped Tough Deficit Policy—But Was It Political Bias?,” Guardian, November 30, 2010.
12. D. Laws, 22 Days in May: The Birth of the Lib Dem-Conservative Coalition (London: Biteback Publishing, 2010); and Irwin, The Alchemists, 244.
13. P. Wintour, “Mervyn King: I Gave Nick Clegg No New Information on Debt Crisis,” Guardian, July 28, 2010.
14. S. Wren-Lewis, “The Austerity Con,” London Review of Books 37, no. 4 (2015), 9–11.
15. Irwin, The Alchemists, 248–249.
16. P. Krugman, “More on Invisible Bond Vigilantes,” New York Times (blog), November 10, 2012.
17. N. Watt, “David Cameron Makes Leaner State a Permanent Goal,” Guardian, November 12, 2013.
18. ONS, “Statistical Bulletin: Public Sector Employment, UK: September 2016,” https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/publicsectorpersonnel/bulletins/publicsectoremployment/september2016.
19. T. Crewe, “The Strange Death of Municipal England,” London Review of Books 38, no. 24 (2016), 6–10. For a dramatic summary of the impact of austerity on the British welfare state see the essays in V. Cooper and D. Whyte, eds., The Violence of Austerity (London: Pluto Press, 2017).
20. Clark, Hard Times, 180–191.
21. Editorial, “The Risks and Rewards of George Osborne’s Austerity,” Financial Times, July 21, 2015.
22. S. Stein, “Peter Orszag, Former Top Obama Adviser, Takes Issue with Portrayal in New Book,” Huffington Post, February 24, 2012, www.huffingtonpost.com.
23. Kuttner, Presidency in Peril, 207.
24. “Obama’s State of the Union Transcript 2010: Full Text,” Politico, January 27, 2010.
25. P. Krugman, “Obama Liquidates Himself,” New York Times, January 26, 2010.
26. J. Geraghty’s National Review blog quoted in “How the Austerity Class Rules Washington,” Nation, October 19, 2011.
27. H. Yeager, “Circling Back on the Orszag Story,” Columbia Journalism Review 9 (January 2010).
28. Bernanke, Courage to Act, 504; and L. Elliott, “It’s Too Soon for Austerity, Ben Bernanke Tells Congress,” Guardian, July 22, 2010.
29. E. Luce, “US Deficit Key to Orszag Departure,” Financial Times, June 25, 2010.
30. T. Skocpol and V. Williamson, The Tea Party and the Remaking of Republican Conservatism (Oxford: Oxford University Press, 2012).
31. G. C. Jacobson, “The Republican Resurgence in 2010,” Political Science Quarterly 126, no. 1 (2011), 27–52.
32. S.-A. Mildner and J. Howald, “Jumping the Fiscal C
liff: The Political Economy of Fiscal Policy-Making under President Obama,” CESifo Forum (June 2013).
33. T. E. Mann and N. J. Ornstein, It’s Even Worse Than It Looks: How the American Constitutional System Collided with the New Politics of Extremism (New York: Basic Books, 2016), 9–10.
34. Q. Peel, “Merkel Spells Out €80bn Spending Cuts,” Financial Times, June 8, 2010.
35. OECD, “Budget Deficits: What Governments Are Doing” (2010), http://www.oecd.org/germany/budgetdeficitswhatgovernmentsaredoing.htm.
36. “German Government Agrees on Historic Austerity Program,” Spiegel Online, June 7, 2010.
37. Peel, “Merkel Spells Out €80bn Spending Cuts.”
38. D. Mara and A. Bowen, “German Government Unveils Unprecedented Austerity Plan,” Deutsche Welle, June 7, 2010.
39. A. Beattie and Q. Peel, “Scene Set for G20 Battle over Fiscal Strategy,” Financial Times, June 24, 2010.
40. W. Schäuble, “Maligned Germany Is Right to Cut Spending,” Financial Times, June 23, 2010.
41. L. Summers and T. Geithner, “Our Agenda for the G-20,” Wall Street Journal, June 23, 2010.
42. J. Calmes and S. Chan, “Leaders at Summit Turn Attention to Deficit Cuts,” New York Times, June 26, 2010.
43. OECD, “Employment: Job Creation Must Be a Top Priority in Months Ahead, Says OECD’s Gurria,” July 7, 2010, http://www.oecd.org/newsroom/employmentjobcreationmustbeatoppriorityinmonthsaheadsaysoecdsgurria.htm.
44. H. Zimmermann, “A Grand Coalition for the Euro: The Second Merkel Cabinet, the Euro Crisis and the Elections of 2013,” German Politics 23, no. 4 (2014): 322–336.
45. Bastasin, Saving Europe, 221–235.
46. Papaconstantinou, Game Over, Kindle locations 2352–2365.
47. IMF Country Report 11/68 (March 2011).
48. Bank of Greece, “The Chronicle of the Great Crisis: 2008–2013, http://www.bankofgreece.gr/BogEkdoseis/The%20Chronicle%20Of%20The%20Great%20Crisis.pdf.
49. CEBS, “EBA Aggregate Outcome of the 2010 EU Wide Stress Test,” July 23, 2010, https://www.eba.europa.eu/documents/10180/15938/Summaryreport.pdf/95030af2-7b52-4530-afe1-f067a895d163.
50. A. Blundell-Wignall and P. Slovik, “The EU Stress Test and Sovereign Debt Exposures” (OECD Working Papers on Finance, Insurance and Private Pensions, no. 4, OECD Financial Affairs Division, 2010).