Latvia joins the sinking euro ship

4 Jan, 2014 at 10:35 | Posted in Economics, Politics & Society | 3 Comments

Latvia began the new year by joining the eurozone.

According to EU commissioner Olli Rehn, this marks “the completion of Latvia’s journey back to the political and economic heart of our continent.” And Latvia’s Prime Minister Valdis Dombrovskis thinks it’s “a big opportunity for Latvia’s economic development.”

To my ears this sounds like we’re in for yet another Latvian success story …


  1. The austerity story is cut-reform-grow. This seems reasonable as long as the reform leads to sustainable growth. If one has another crash too soon then the hoped for benefits of austerity will be lost. In the UK ‘reform’ seems to be just another word for cuts, and its is not obvious how they lead to growth. The story seems to be that the crash was due to Labour, so as long as we keep them out we will be okay. I lean more to the view that the crash was permitted by bonkers economics, and ‘short term pain for long-term gain’ could only be justified by reforms to economics, which I think would need a more principled use of mathematics.

  2. I found it odd that 60% of Ukrainians want to join the EU. But you have to put “it” in perspective with what state the country is in to begin with. It’s good that countries still want to join the EURO. Some people still think there is a way out of the mess the EU is in. I don’t know what it is and nor do people I respect who are far smarter than me but hope does still exist.

    • Who are these “people I respect who are far smarter than me….”? Haven’t you tumbled to the fact that the elite is totally incompetent? Prof. Bill Mitchell (who runs the Billyblog site) as long advocated that the IMF is so useless it should be closed down. And Dean Baker (director of the Centre for Economic Policy Research) said “In elite Washington circles, ignorance is a credential”.

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