ASI comments on Greece's debt restructuring plan feature in CityAM

ASI Fellow Lars Christensen was quoted in CityAM supporting the new Greek finance minister's debt restructuring plan:

Greece's finance minister Yanis Varoufakis has found an enthusiastic backer for his debt restructuring plans in one of Britain's premier free-market think-tanks.

Greece has abandoned demands for a write-off of foreign debt and has instead proposed swapping the outstanding debt for growth-linked bonds accompanied by a crackdown on tax evasion and budget surpluses.

Varoufakis described the new options as a "menu of debt swaps", according to the Financial Times. The first of these options would be new bonds indexed to nominal economic growth, which would replace European rescue bonds.

Lars Christensen, a fellow at the Adam Smith Institute (ASI), said today:

The European Central Bank's job is to ensure nominal stability in the Eurozone economy. The ECB should not bail out governments and banks.

Unfortunately again and again over the past six years the ECB has been forced to bailout Eurozone states. Hence, the ECB has repeatedly conducted credit policy (rather than monetary policy) to avoid Eurozone countries defaulting.

Read the full article here.

Ben Southwood argues against renationalising the railways in an IBTimes video

Head of Research at the Adam Smith Institute, Ben Southwood, argued against renationalising the railways in an International Business Times video. Watch the video here. (Starts 05:10)

Press Release: UK should back Greek NGDP-linked debt restructuring plan

For further comments or to arrange an interview, contact Communications Manager Kate Andrews: kate@adamsmith.org / 07584 778207

Following the meeting between George Osborne and new Greek finance minister Yanis Varoufakis, Lars Christensen, Fellow at the Adam Smith Institute, said:

The European Central Bank's job is to ensure nominal stability in the Eurozone economy. The ECB should not bail out governments and banks.

Unfortunately again and again over the past six years the ECB has been forced to bail out Eurozone states. Hence, the ECB has repeatedly conducted credit policy (rather than monetary policy) to avoid Eurozone countries defaulting.

The ECB itself is largely to blame for this because it has kept monetary conditions far too tight. However, it has been under tremendous pressure to bail out nations and banks rather than conduct sound monetary policies.

By linking Greece's EU and ECB debts to Greek nominal GDP, as Varoufakis has suggested, Greece's public finances would be less vulnerable to monetary policy failure in the Eurozone.

The Chancellor George Osborne should be an enthusiastic supporter of Varoufakis’s debt plan as it would cut the cost of the ECB's tight money policies and reduce the danger of another major Eurozone crisis.

Notes to editors:

For further comments or to arrange an interview, contact Kate Andrews, Communications Manager, at kate@adamsmith.org / 07584 778207.

The Adam Smith Institute is an independent libertarian think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

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Ben Southwood criticises limits on cheap steel imports to the UK in CityAM

Head of Research at the Adam Smith Institute, Ben Southwood, criticised calls for limits on cheap steel imports to the UK in CityAM.

However, critics of intervention voiced their disagreement. “Like a drop in the oil price, it [a low steel price] can hurt some industries, but, like a drop in the oil price, it is an overall benefit to society,” Ben Southwood, head of research at the Adam Smith Institute, told City A.M.

Read the full article here.

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A British basic income? Green leader Natalie Bennett is a bad advocate of a good improvement to the welfare system - Sam Bowman writes for the International Business Times

Deputy Director of the Adam Smith Institute Sam Bowman makes the argument for a British basic income in The International Business Times:

As most people laughed at Natalie Bennett's car-crash interview with Andrew Neil this weekend, in which the Green Party leader appeared to have no grasp of any of the numbers behind her policies, a few unlikely viewers were wincing.

Her craziest-sounding policy, to give a "basic income" of £72 a week to everyone in the country regardless of income at a cost of £280bn to the Exchequer, has some surprising supporters on the free market right.

Many free marketeers, including Nobel laureate Milton Friedman, favour a form of welfare known as a "Negative Income Tax". This would replace existing benefits aimed at alleviating poverty like tax credits and jobseekers allowance with a single automatic payment that is tapered off according to earnings.

Read the full article here.

Sam Bowman argues against CPRE's latest Green Belt report on BBC Radio Surrey

Deputy Director of the Adam Smith Institute Sam Bowman argued against CPRE's latest report on the Green Belt on BBC Radio Surrey, and highlighted just how little Green Belt land would be needed to address London's housing crisis over the next decade. Listen to the interview here. (Starts 02:10:05)