John Kay

The presidency of the French Republic is a job description written for one man – Charles de Gaulle – and no one else has since filled the post with much distinction.

Keynes famously advocated reducing unemployment by employing people to dig holes and fill them in again: today it would be enough to employ them to fill the potholes that are already there.

Governments will in the end always put voters ahead of prior commitments or external obligations. That democratic imperative has costs and benefits – but, overall, the benefits of popular accountability far exceed the cost.

On the 7th February, John took part in an Intelligence Squared event entitled, ‘What hope for the economy?’, in which Evan Davis grilled a panel of eminent economists and leading figures from the world of business and finance. They discussed the economic crisis, banking regulation and the future of capitalism. You can watch the full debate here.

Financial markets are an effective discipline on profligate individuals and states because markets cannot easily be bullied or lobbied, and their threat to make the cost of funds prohibitive is effective.

If the eurozone had quickly recognised defeat in Greece, it would have suffered a manageable failure and learnt an important lesson for the future. Instead it has followed the martingale.

As the eurozone crisis deepens and political leaders flail in the face of the huge debts that have left financial institutions and member states teetering on the brink, it is important to understand how we got here if we are ever to figure a way out. In 2005, well before the financial crisis, when the [...]

The eurozone’s difficulties have been created by member states not markets, giving members more resources to fight markets makes things worse, not better.

The skill of the statesman is to distinguish situations in which ambiguity makes coexistence possible from those that will make the future more troublesome. In this respect, politicians who have steered world affairs through the financial crisis have not served us well.

When New York crassly mismanaged its financial affairs, the president’s response was famously paraphrased as “Ford to City: drop dead!” When Greece was guilty of similar mismanagement the reaction of the ECB and the European Commission was “how can we help?”.