*** ELOI LAURENT: Nos mythologies économiques. Editions Les Liens qui Libèrent (2 impasse de Conti, F-75006 Paris. Internet: http://www.editionslesliensquiliberent.fr ). 2016, 106 pp, €12. ISBN 979-10-209-0323-5.
Just like his illustrious colleague Amartya Sen, Eloi Laurent thinks that economics is a moral science. But this, in reality, when push comes to shove, it no longer is. Hence this long angry cry, this hundred-odd page imprecation by an economist active at the Observatoire Français des Conjonctures Economiques, in which he denounces what is no longer a science, is not an art, but is 'more a mythology that disenchants the world' and whose propagandists reveal themselves to be the servants of a 'culture of fatality' that is polluting public debate and poisoning the democratic spirit. In this short book, this lecturer at Sciences Po and Stanford University wanted to calmly but firmly set things straight in order to 'both immunise citizens against economic mystification and release politicians from their deadly spell.'
Concretely, the author proceeds to deconstruct three dominant discourses that use and abuse economic myths, blinding our contemporaries about the true challenges that are to be addressed. He does it not by hauling himself onto the chair of truth ('there is no truth in economics,' he says at the outset, only 'hypotheses upstream and choices downstream' along with, 'between the two, in the best of cases, a robust method and instruments'), but by wishing to 'restore to the reader the taste of economic questioning.' He starts by attacking 'neoliberal mythology,' with its ideas carried by Reagan and Thatcher that crystallised with the… 'European Union, which was constructed in the 1990s in opposition to both Keynesian thought and the welfare state.' Free competition and an even playing field require the existence of strong public regulation, explains the author, 'the promoters of the so-called free market' not demanding the end of public intervention in the economy but 'simply that the economy be diverted in their favour.' The financial liberalisation of the last decades and the aid provided by States 'to actors in the economy, prioritising the financial ones,' at the height of the crisis of recent years, demonstrate this, which proves that we have gone from social insurance provided to workers to a financial guarantee given to the banks and investors. Clearly, the economic power of the State remains intact, but is now 'put in service of different cause from social progress,' companies having learned to gather public subsidies and mostly escape from tax being the winners in this fool's game. The author supplies arguments attacking the pre-eminence of production over redistribution, which leads him to vehemently challenge the fact that the State should be managed like a household or a company, since it has to concern itself with a collective unit that is present now and in the future. Thus public power 'must continue to invest, even if the financial situation is difficult,' particularly if interest rates are historically low; and failing to do so is 'an error of management'! Eloi Laurent openly accuses those who have imposed austerity measures in Europe in recent years, reminding them that when the State tightens its belt, 'it transforms the phase of economic recession into social depression, and needlessly extends the phases of stagnation, which all the other economic agents end up suffering from.'
In the author's view, daring to assert that social systems are financially unaffordable also smacks of a hoax, not to mention that the 'myth of structural reforms' is nothing other than a fig leaf for the 'complete social regression' that some parties desire. These are the last accusations made in relation to 'neoliberal mythology.' There are plenty more, and equally powerful, when the author sets about deconstructing talk that is part of 'xenophobic social mythology' and 'eco-sceptic mythology,' which also pave the way for extremist 'political mystifications.' Michel Theys
*** YANIS VAROUFAKIS: Un autre monde est possible. Pour que ma fille croie encore à l'économie. Flammarion (87 quai Panhard et Levassor, F-75647 Paris. Tel: (33-1) 40513100 - Internet: http://www.editions.flammarion.com ). 2015, 215 pp, €15. ISBN 979-2-0838060-8.
In this book written for his daughter, former Greek finance minister Yanis Varoufakis insists once again that no, economic truth does not coincide with the decisions that it was possible to take in the eurozone in crisis based on what have been the dominant beliefs for three decades. For this professor of economics with abilities recognised even by his enemies, the prevailing and 'ever more barbaric' concept of the economy arises less from the pertinence of the ideas underlying it and far more from 'the exercise of a cultural, economic and financial power' emanating from Anglo-Saxon capitalism that has arrayed itself with neo-liberalism. The way he sees it, the world (or the Western world at least) has let itself be 'won over by a simplistic way of thinking, according to which the economic sphere must be separated from the political, philosophical and cultural spheres,' which has led the economy to acquire 'an enormous discursive and social power to the detriment of democracy, politics and culture.' Even within the European Union, democracy has in this way started to be the bare shadow of itself, because it is a fact that 'the big decisions had to be taken by committees of technocrats constituting politics-free zones;' Greek democracy being a fine example of this, finding itself in 2015, after having been smashed by tanks in 1967, 'smashed by the banks' thanks to the decisions of the Troika and finance ministers from the eurozone. This book is, however, not a new indictment drawn up by this anti-establishment economist, but a profoundly pedagogical book aiming to reconcile the young - and not so young - with the true dimensions of the economy. Why does the world currently produce so much inequality? How should price and value be distinguished from each other? What exactly is covered by the concepts of debt, profit and wealth? And what about the concepts of of credit, crisis, State and currency? These are some of the questions to which the author provides clear answers that are perfectly accessible to the widest audience, not hesitating to take inspiration from movies or literary figures to make his ideas clearer. One leaves this book admitting that he is no doubt not totally wrong when he sarcastically argues that 'it's no good the economy using mathematical and statistical formulae, for it is more astrology than astronomy…' (MT)
*** YANNIS PAPADOYANNIS: L'ascension et la chute de l'homo oeconomicus (The rise and fall of homo economicus). Le mythe de l'orthologue. Editions Papadopoulos (9 Kapodistriou, GR-14452 Metamorphosi. Tel: (30-210) 2846074 - Fax: 2817127 - Email: info@epbooks.gr - Internet: http://www.epbooks.gr ). 2015, 384 pp, €12. ISBN 978-960-484335-0.
What has not gone well in the global economy over the past six years? Why has the economy abandoned itself to tragedy? Starting from an overview of the various economic theories, the author of this book compares and contrasts the unshakable belief of some in economic science with the complex and chaotic realities of the globalised economy. Chief editor of economics for the 'Kathimerini' newspaper, Yannis Papadoyannis seeks answers to the interruptions by opening up to sciences which, such as neurosciences, anthropology, sociology and the like, upset the idealised image that we have of our capacities and knowledge, whether as individuals or as societies. He explains in simple, understandable terms why we can delude ourselves, why we have an almost religious faith in orthodox finance, absolute rationality of the individual, the primacy of the free market, to the point of cutting ourselves off from the economic realities of everyday life in society today. With this thematic guide, he helps us understand the causes of the current multidimensional economic crisis, referring to various masters of classical economic thought- Robert Heibroner, Thorstein Veblen, Karl Polanyi… - to show how the marvellous world of the time of the founding father, Adam Smith, has finally brought us to the state of shock and panic of recent times, with the imperative need to give new stability to the economy. The book is punctuated with a vast bibliography. (AKa)
*** The Federalist. A political review. Edif (8 Villa Glori, I-27100 Pavia. Internet: http://www.thefederalist.eu ). 2015, 186 pp. Annual subscription: €35 (Europe), €50 (elsewhere).
Alongside all the articles included in the last 'Il federalista' (see European Library 1132 of 24 March 2016), this issue of the English version opens with a reflection on the opportunity that the Greek crisis might be for turning the eurozone into a political Union. The editorialist expressing himself on behalf of the review defends the viewpoint that everything depends on the influence that should be exerted on France to get it to accept the federal model at last, this change being vital to ensure that Germany does not give in to the reactionary impulses within it, being fuelled by the populism that is growing everywhere in European States. (MT)
*** ANNIS TSAMOURGELIS: Le rôle des banques et de l'euro dans la crise européenne et grecque: les complices. Éditions Papazisi (2 rue Nikitara, GR-10678 Athens. Tel: (30-210) 3822496 - Fax: 3809020 - Email: papazisi@otenet.gr - Internet: http://www.papazisi.gr ). 2016, 392 pp, €24.38. ISBN 978-960-02-3195-3.
This book looks at the foundations of the banking system and how in Greece it cosied up to a perverse capitalist superstructure, which is still in operation today. After explaining the role of bank systems and the influence of monetary policy on the economy, Prof. Yannis Tsamourgelis of the University of the Aegean Sea highlights the mechanisms by which banks influence monetary policy strategies, which leads him to demonstrate that the 'new consensus' macroeconomic model is considered a key element of the character of the European Union and the monetary policy activated in the framework of the eurozone. The author examines the European Central Bank's response to the crisis, comparing its monetary policy with that of the US Federal Reserve in order to discern the structural and policy differences. The various situations of the eurozone member states are also reviewed, before the specific case of Greece's structural adjustment to European monetary policy is examined, from the dictatorship of the colonels to the third memorandum. The author discerns the role played by the financial system in the birth and persistence of the Greek crisis, the banks clearly contributing to its prolongation and growing scale though the key position they hold in Greek society. The author then examines the collapse of the banks in June 2015 and the third bailout that proved to be necessary, all the consequence of bad macroeconomic choices. He refers to alternative theories about a return to the drachma and conditions for getting out of the crisis based on the collapse of liquidity. Finally, through a number of examples sought in the international financial organisation, the author stresses the need to make some radical reforms, failing which Greece's bank and financial landscape will remain disastrous for a long time to come. (AKa)
*** ALESSANDRO GIACONE: Jean Guyot. Un financier humaniste. CNRS Editions (15 rue Malebranche, F-75005 Paris. Tel: (33) 53102700 - Email: cnrseditions@cnrseditions.fr - Internet: http://www.cnrseditions.fr ). 2012, 422 pp, €25. ISBN 978-2-271-08757-7.
Young Italian historian Alessandro Giacone devotes this irreproachable biography to 'a man unknown to the general public.' A good choice because the career of Jean Guyot deserves recognition. Successful in the financial inspection examination at the end of World War Two, this man born in Grenoble in France started with a career in the civil service that was as brief as it was promising because he was a member of the cabinet office of Robert Schuman at the ministry of finance and the presidency of the Council and of the Quai d'Orsay, before becoming sub-director of the Treasury at a very young age. It was this last job that prevented him from being one of the people who drew up the 'Schuman Declaration,' but it enabled him to get to know a certain Jean Monnet at the time when the latter was Commissioner for the Plan in Paris. This meeting would prove decisive in two ways. Firstly, Jean Guyot would accept the inspirer's invitation to join the High Authority of the European Coal and Steel Community, Monnet in return having to accept the sine qua non demand of this highly ambitious young man of being 'immediately appointed as the head of the Finance Division' of the institution that would become the European Commission; and then he caught the 'virus' of European integration, and would be active for this cause until his dying day, the personal money he would devote to 'his' 'Hippocrene Foundation' to support young people's projects characterised by the European ideal still demonstrating this today. The 'virus' did not, however, prevent him from a radical shift in direction when he felt that the failure of the European Defence Community was quashing the 'impetus of the pioneers of European construction,' a time when he became associate-manager of Lazard Bank. He would remain in this position until the end of his career, remaining more than ever a 'man of influence' being able to feed the suspicion of 'a dangerous contiguity between private and public interests.' Through his fine work, the author, senior lecturer at Grenoble University, highlights above all the 'deep sense of ethics and disinterestedness' that characterised this man attached, as Eric Roussel notes in the preface, to the 'Common Good.' Loyal readers of Agence Europe will discover in these pages a thousand and one pieces of information about the true nature of the initial European project, this appreciation of Jean Guyot was made by François Duchêne, for example, in 1988: 'There is no doubt that the Schuman Plan represented something completely different from what had gone before … It was the first time that one really introduced a certain idea of supranational authority and transfer of sovereignty. And it was this that made the real difference. Personally, I am convinced that if there hadn't been this element, one would probably no longer be talking about Europe today, but would be talking about it as a theoretical idea.' Clearly, the man would only have been distressed to see Europe 'badly treated by the French elite,' and he would have suffered to see the fate reserved for him today! (MT)