Focusing on Europe from Three Vantage Points

The biggest threat to global economic growth at the moment is the Eurozone.

It is suffering from high unemployment, inflation far below the central bank’s 2% target, renewed talk of a Greek debt default or (perhaps) exit from the euro, the rise of extremist political parties and a distinct lack of consensus and leadership among its top politicians.

Europe’s political paralysis at a time of economic peril makes Washington look good by comparison. 

At three events in January sponsored by the Center on the United States and Europe and Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution, we’ll take a close look at Europe, its economy, its politics and the risks it poses to the rest of the world. The conversations come as the European Central Bank approaches a January 22 meeting at which it may (or may not) launch a big ‘quantitative easing’ initiative to reduce the risks of deflation in the 19-national currency zone and a pivotal January 25 national election in Greece.

January 7 (2:30-4 p.m.): Saving Europe (Again): The European Financial Crisis Continues. Carlo Bastasin, a non-resident Brookings senior fellow and author of the recently updated book Saving Europe: Anatomy of a Dream (Brookings Press, January 2015), will explain why he thinks Europe’s problems have grown more insidious lately. The Eurozone, he argues, now faces a crisis of democracy and presents a warning for the future of globalization. Bastasin is also a senior fellow at LUISS University’s School of European Political Economic in Rome and a columnist for Il Sole-24.

Following his remarks, Brookings’ Fellow Douglas Elliott will moderate a discussion with Bastasin, Brookings’s Vice President and Director of the Global Economy and Develoment Program Kemal Dervis, and Peterson Institute for International Economics Visiting Fellow Nicholas Véron.

January 14 (10:30-11.45 a.m.): The Global Financial Crisis: Lessons From History. Barry Eichengreen, an economic historian at the University of California, Berkeley, and author of Hall of Mirrors: The Great Depression, The Great Recession and the Uses – and Misuses – of History (Oxford University Press, 2015) will argue that policymakers around the world did just enough stop the 2008-09 financial crisis from producing another Great Depression., but both the U.S. and Europe, in particular, should have learned more from history. Today, he says, Europe is stuck with an unfinished monetary union that is impossible to dismantle and equally impossible to complete. (Eichengreen also is co-editor of a forthcoming Brookings Institution Press book, Renminbi Internationalization: Achievements, Prospects and Challenges.

Following Eichengreen’s remarks on the Europe, the U.S. and the rest of the world economy, I will moderate a conversation between him, David Lipton, No. 2 at the International Monetary Fund, which has been pressing Europe to do more to resist its economic malaise, and Christopher Brummer, a professor at Georgetown University Law School with a specialty in international financial regulation.

January 16 (9-10:30 a.m.): The Eurozone: Now What? A Conversation with Lucrezia Reichlin. Reichlin, who has, among other things, been conducting research into the workings of monetary policy in the Eurozone, will focus on the latest developments in Europe and the big decisions facing the ECB this month.

The former director-general of research at the ECB, Reichlin is professor of economics at the London Business School, research director of the Centre for Economic Policy Research, co-founder of Now-Casting Economics Ltd. and a columnist for Il Corriere della Serra. She recent was profiled by the International Monetary Fund.