Pensions are at the center of Greece’s latest dispute with its creditors.
The Greek Kathimerini newspaper reports that the International Monetary Fund’s managing director, Christine Lagarde, stressed to Prime Minister Alexis Tsipras during a recent meeting at the World Economic Forum in Davos, Switzerland that his government’s proposal for pension reform was inadequate.
The IMF jointly administers Greece’s €86 billion bailout with the European Union.
But Tsipras has said Greece won’t succumb to “unreasonable and unfair demands” and reportedly told Lagarde “there is no way” he can cut pensions for current retirees.
“One pension is a whole household’s income in the present circumstances,” the far-left leader told parliament last month. Read more
Projections Underscore Need for Entitlement Reform
Projections released by the Congressional Budget Office on Tuesday underscore the need for comprehensive reform of America’s biggest spending programs.
The CBO, an independent outfit, warns that the federal deficit will jump to $544 billion next year, or 2.9 percent of gross domestic product — the first time since 2009 that the shortfall is expanding relative to the size of the economy.
Over the next ten years, deficits would add up to $9.4 trillion unless significant policy changes are made.
The CBO sees the debt rising from $13.1 trillion last year, or 74 percent of GDP, to $23.8 trillion, or 86 percent, by 2026. Read more
Unfunded State Benefits: America’s Next Fiscal Crisis
America’s fiscal crisis looks less pressing than only a few years ago. A combination of spending restraint and tax increases that has resulted from messy compromises between President Barack Obama, a Democrat, and the Republican Congress should help push the deficit down to a manageable 2.5 percent of economic output this year.
Longer term, the rising costs of health and pension programs still look worrisome. But before the problem reaches Washington DC, it could wreak havoc at the state and local-government level. Read more
Between the Crazy, Serious Ideas in Republican Debate
Wednesday’s Republican presidential debate hosted by CNBC was easily the worst so far this year. The moderators seemed more interested in catching the candidates in hypocrisies and discrediting their looniest proposals than encouraging a substantive debate — but at the same time let some of the most outlandish claims go unchallenged.
Between the crazy, though, there were glimmers of a reform-minded conservative platform taking shape. Read more
Democrats Resist Weakening Decades-Old Social Model
Democrats in the United States are deluding themselves and their voters if they vow to resist changes in the economy over which politicians have little control.
From their doubts about a transpacific trade pact to fights against flexible labor relations, Democrats are showing themselves to be uncomfortable with many of the tenets of globalization that have redefined the world economy since the 1980s. Read more
French Farmers’ Protests Divide Europe
Protests by French farmers against low dairy and meat prices are dividing Europe. While similar actions are expected in neighboring Belgium, Germany and the Netherlands are irked that the Paris government is enacting protectionist measures in an attempt to quell the unrest. Read more