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Danny Blanchflower

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108
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2019-08-09
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2019-08-09
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  1. “Well, no. Kick out the gems. It was sort of modest. Modest recovery came a pretty reasonable recovery. And then austerity came in 2010. And every data series you can show in the UK just turned flat. So output was growing and then austerity, which I call reckless, failed turned downwards. Keynes precisely warned there's an article I talk about in the book. In 1931, Keynes warned about the long draggings of dragging conditions of semi-slump that follow the crash. And unless you come in there and put public spending in, then you'll see slowing. The argument that George Osborne, who was Chancellor made, was that if you cut public spending, the private sector will step into the fold completely contrary to Keynes has also failed.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “11 years in now from the start of that great recession. Real wages today in the UK are 6% below what they were in February 2008. And this in the UK anyway, it's the third slowest recovery ever. The last one 300 years ago was the South Sea bubble. And the one before that, 600 years ago, was the Black Death. Which was good for productivity. Bubonic plague is excellent for productivity, of course. So anyway, so the logic is that we have had very slow recoveries and I think driven by macro errors. And now we see economies slowing. But after 10 years of recovery, still people are hurting. So the big question is, what's going on and why is it that people are hurting? And I think the story is lack of good jobs, if you like, an expectation that things are going to be better in the future. And Deeton in case of documented essentially the driving force behind the deaths of despair they talk about as a failure in the labor.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “Yeah, I started working on this book and I was reading some results from Gallup. And for some reason, I went to the front of their page and they literally, and I started out with this, they literally say, here's one of Gallup's most important discoveries. They've been doing this since the 1930s. What the whole world wants is a good job. So that's the theme of the book. And I think what we've seen in the last decade is the loss of those good jobs. And the result of it has been populist movements around the world, people hurting. And the connection I make in the book is that central banks and other policymakers in the US especially say we're at full employment. And the theme of the book is, well, if we were at full employment, people wouldn't be hurting this way. And so I document that. And a good example in the UK is”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “I think that's 100% right. And what's happened, economists said to me, you should never expect central banks or economists to see turning points. I think that's complete nonsense. I think what you have to have is you can't just look at the mechanical things. You have to look at what I call the economics of walking about exactly as you said. Think about what happened at the last great financial crisis, the great crash, and think about what happened. And there were lots of indicators. The best indicators actually at the bank were what's called the bank's agent scores. And the agents would go around the country and report things. And when you looked at that, the world had dropped off a cliff by around May 2008 and nobody was listening to it. The economists weren't listening to it. So in fact, those...”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “Hell broke. All hell broke loose. And I remember thinking I did not expect to be in a position where in three successive months my committee, including me, voted for 50, 150, and 100 basis point cuts in three months. And then we kept going and then we did QE. I mean, this was literally like the world was just dropping off a cliff. So it certainly was not boring. It was scary. And in a sense, the story I think was that economics told us very little about what to do there. How low could we go? Could we go to zero? Could we go below zero when you do quantitative easing? How much? What sort of easing? When do you do it? How many auctions a week do you have? So we didn't know any of that stuff. So I think it was really scary and exhausting.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Essentially, that was the issue. There really wasn't one. And so by the end of the week, and when essentially the money at the Northern Rock ran out, the website failed on the Wednesday. There was no guarantee essentially from the government. And the only way to stop it was to actually introduce one. And that's what stopped the run. But that was a year before the market collapsed. I started to think that we were really disappearing into a hole. So I started on my own to start to vote for rate cuts. And I voted for rate cuts for a really long time on my own. And I kept saying there's a horrible recession coming. Nobody else on the committee was really along with me. And then we got to September 2008.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “I was told at the beginning, I remember Gordon Brown told me the hope is for you that central bank is going to be boring. That's not exactly how it turned out. And I think the big deal for me was I was going back and forth every three weeks between the US and the UK. And I think the big insight for me was that the things I saw in the US started to occur in the UK a few months later. And the first big deal for me was the failure of Northern Rock. There were thousands of people in the street standing outside the branches of that bank for the first time in a hundred years. So that was your sort of starter.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “Well, labour economics is the study of work, it's the study of jobs, it's about why people have got jobs, why they haven't, and it's about the price of labor. So it's about wages, it's about compensation. Actually, I got into it, started to think about kids, starting to think about unemployment of the young. And in the 1980s in the UK, that was a really big deal. So I started to think about that. And it just grew from there. And then in the end, I became a monetary policymaker. And the labour market turned out to be central to everything. So started out being a labour economist, did some macro, but it turns out now the big issues around the world in macroeconomics are about labor economics. So it's been a long journey, but it's been kind of a good one.”

    2019-08-09 · Masters in Business · Danny Blanchflower Discusses Labor Economics (Podcast) · IDENTIFIED FROM THE TRANSCRIPT · source