The Board of the ‘European Center of Austrian Economics Foundation’ is pleased to announce the appointment of Prof. Dr. Steve H. Hanke* as the “ECAEF Gottfried von Haberler Professor”. Steve Hanke indicated that he is honored by the fact that the professorship is named after the late Gottfried von Haberler, one of his mentors and a leading scholar in the academic tradition of the Austrian School of Economics. Hanke believes that the European Center of Austrian Economics (ECAEF) and the Liechtenstein Academy Foundation (LAF) are among the most suitable institutions to disseminate the ideas of the Austrian School to both specialists and the general public.
*Steve H. Hanke Steve H. Hanke (/ˈhæŋki/) is an American applied economist at the Johns Hopkins University in Baltimore, Maryland. He is also a Senior Fellow and Director of the Troubled Currencies Project at the libertarian Cato Institute in Washington, DC, and Co-Director of the Johns Hopkins Institute for Applied Economics, Global Health, and the Study of Business Enterprise in Baltimore.
When Naive Presumptions
prompt Hasty Judgments:
On the Benefits and Problems
of Genetic Engineering
(Wenn Vermutungen zum Urteil werden:
Die Gentechnologie am Pranger)
“Denying the science and technology of which genetic engineering is the current striking manifestation is simply an ostrich reaction and cannot solve our problems”. Bernard E. Rollin
The 15th Gottfried von Haberler Conference will take place on May 17, 2019 at University of Liechtenstein in Vaduz. Conference topic: When Naive Presumptions prompt Hasty Judgments: On the Benefits and Problems of Genetic Engineering. The event will be organized and hosted by ECAEF – European Center of Austrian Economics Foundation. The support of the University of Liechtenstein and multiple local and international sponsors is gratefully acknowledged.
By invitation only
Admission: General CHF 100/Euro 100; Students CHF 50/Euro 50 Academic Director: Kurt R. Leube Tel. +1 650 248 4955 (krleube at stanford.edu) and Tel. +43 676 942 8980 (krleube at gmail.com) Administration: Rosmarie Lutziger Tel. +423 235 1570 (Rosmarie.Lutziger at lgt.com) Media Matters: Karin Brigl Tel. +423 235 2344 (karin.brigl at lgt.com)
Conference Program on May 17, 2019
9:00-9:30 Registration/Fee 9:30-9:45 Welcome and Opening
Biotechnology: Origins, Advances and Current State
(9:30-12:00) 9:45-10:00 Chair tba 10:00-10:30“Vom Düngen und Gären zum Veredeln und Impfen: Was macht die moderne Biotechnologie?” 10:30-10:45 Discussion 10:45-11:15 Coffee break 11:15-11:45“Three Tales of Woe: How Regulation Has Damaged Entire Sectors of Biotechnology” 11:45-12:00 Discussion 12:00-13:30 Buffet Luncheon for all participants at conference site
Session II: Organic, Bio, Natural? On Ignorance and Semantic Traps
(13:30-15:15) 13:30-13:45 Chair tba 13:45-14:15 “Über konventionelle Landwirtschaft und grüne Gentechnologie” 14:15-14:30 Discussion 14:30-15:00“Evidence matters! Towards a Rational Dialogue on Plastics, GMOs or Pesticides!” 15:00-15:15 Discussion 15:15- 15:45 Coffee break
Shackles on Men’s Mind? On the Ethical, Legal and Social Issues
(15:45-18:10) 15:45-16:00 Chair tba 16:00-16:30“Can GMOs help Feed the World?” 16:30-16:45 Discussion 16:45-17:15“Klimawandel und Gentechnologie” 17:15-18:00 Discussion (topical and general)
18:00-18:10 Farewell address 18:20-18:30 Transportation by bus to the cocktail reception 18:30-19:45 Cocktail Reception at Vaduz Castle
Typical economic cycles last about seven years. Since the 2008 financial crisis, we have seen continuous growth in the global economy, and more is expected. The International Monetary Fund forecasts global growth of 3.9 percent for this year and next. We would like to believe that these are realistic predictions and not wishful thinking.
The issue is whether the recovery and the expected growth have a robust, sustainable basis – or are substantial caveats appropriate?
The growth in recent years has been largely driven by consumption. Unfortunately, this was, to a non-negligible extent, due to abundant consumer and housing credit based on cheap money, provided by the central banks in nearly all major economies. At the same time, most governments did not take the opportunity to reduce their deficits, but continued high levels of spending and increasing their countries’ debt.
The cheap-money drug
All major central banks arrived at the limit of their ability to reduce interest rates (being already near zero or below) and have begun to talk of “tapering.” The United States Federal Reserve has already started, while the European Central Bank announced its more than 2.6 trillion-euro bond-buying program would end in September. Believing in the magic that some 2 percent inflation enhances growth, the officials at the ECB have concluded that this goal has finally been reached, so they can also slowly increase interest rates.
However, there are two problems: First, even if we believe in the 2 percent magic, this figure is mainly driven by an increase of 8 percent in energy prices and some 3 percent in food prices. Significantly, core inflation rose by just 1 percent.
But what really aggravates the situation is this: an economy that grows mainly due to abundant, cheap money is a bit like a drug addict. It cannot function without additional money supply – it always needs more, or else it collapses.
The world is arriving at the possible end of a growth cycle, while households and governments have not just empty pockets, but also a high debt burden. At the same time, the central banks have used up all their ammunition. The necessary and overdue increase in interest rates will be disastrous for budgets, both public and private.
Treating the symptoms
The history of the last quarter century’s fiscal and monetary policies mainly consists of treating symptoms, and less so the underlying causes of economic imbalances. If we look at the world’s financial mechanisms, we can see that they are built to avoid situations that can trigger a crisis, but lack the courage to implement real corrective measures. These could be painful, and would expose fundamental weaknesses that are less due to market conditions than significant political “manipulation” of the economy. Some of the main problems have been populist overspending, too much government involvement in the economy and excessive intervention in markets and business.
The recent increase in oil prices could be a real threat to growth. Cheap energy is a good economic driver. The rise might have initially been welcomed as boosting inflation, a sign expected by central bankers, but the increase in costs creates a braking effect. OPEC was aware of this phenomenon and decided to increase output to stabilize prices. The White House also strongly urged such action. It is concerned about the adverse impact of higher energy prices on a fragile world economy (and not only in the context of its new sanctions on Iran).
For a long time, a big problem has been protectionism. The public was not too aware of this issue until President Donald Trump, in his usual very direct way, started to retaliate against unfair practices by a number of U.S. trade partners, especially China. However, even Western blocs, including the U.S. and even more so the European Union, are not innocent. Protectionist policies have not only used tariffs as political tools, but also introduced quotas, regulatory barriers, product specifications, foreign-exchange policies, subsidies and investment restrictions. They put up layers of bureaucratic red tape and numerous other obstacles.
The U.S.’s current retaliation has certainly not created the problem, but it could trigger a crisis. It may be necessary to introduce a long overdue open debate, with the objective of freeing trade from these restrictions. Unfortunately, protectionism under the pretext of shielding consumers or securing jobs is popular, and therefore a valuable tool for populist politics. Such measures are applied – to the detriment of prosperity – in authoritarian countries and in democracies alike.
A combination of rising energy prices, trade restrictions and slowing growth in certain countries (especially China), are adverse indicators for the world economy. The staggering debt of both governments and households allow little margin for additional consumption. Due to quantitative easing and low interest rates, central banks will not have room to head off a strong recession. We have to recognize that already, central banks’ balance sheets are overextended.
And although we should also not overestimate them, political misjudgments and crises are adding to the problem. We need not panic, but it is time to make a cautious, critical assessment and not be misguided by false hope.
It is time that the real causes are treated, and not just the symptoms.
*GIS is a global intelligence service providing independent, analytical, fact-based reports from a team of experts around the world. We also provide bespoke geopolitical consultancy services to businesses to support their international investment decisions. Our clients have access to expert insights in the fields of geopolitics, economics, defense, security and energy. Our experts provide scenarios on significant geopolitical events and trends. They use their knowledge to analyze the big picture and provide valuable recommendations of what is likely to happen next, in a way which informs long-term decision-making. Our experts play active roles in top universities, think-tanks, intelligence services, business and as government advisors. They have a unique blend of backgrounds and experience to deliver the narrative and understanding of global developments. They will help you develop a complete understanding of international affairs because they identify the key players, their motivations and what really matters in a changing world. Our experts examine the challenges and opportunities in economies old and new, identify emerging politicians and analyze and appraise new threats in a fast-changing world. They offer new ideas, fresh perspectives and rigorous study.
Karl-Peter Schwarz im Interview mit dem Britischen Historiker Timothy Garton Ash. Aufgenommen im Zuge der 14. Gottfried-von-Haberler Konferenz 2018 in Vaduz (FL)*
Englische Zusammenfassung seines Vortrags “Is a Spectre still haunting Central Europe?”
In central Europe we are witnessing a dramatic reaction against nearly 30 years of transformation, liberalisation, Europeanisation and globalisation. Populist parties in Hungary and Poland appeal to traditional notions of national community and sovereignty, yet also have economic policies more usually seen on the left. Some of their electorate comes from the left. They also claim to speak for democracy against liberalism.
What went wrong? How far does what is happening in central European politics now (including the Alternative für Deutschland) reflect unresolved traumas of four decades of Soviet communist rule? How far of an insufficiently addressed past, and how far of the cost of transformation? Was there any better way to dismantle the Marxist-Leninist legacy? Has the impact of the European Union amounted to ‘undemocratic liberalism’, as some critics suggest?
Drawing on four decades of writing about central Europe, Timothy Garton Ash will reflect on these and other questions.
*Timothy Garton Ash held his talk at the 14th International Gottfried von Haberler Conference which took place on May 25, 2018 in Vaduz, at University of Liechtenstein. Topic: “Karl Marx: Born 1818 and Still Going Strong?” – German: “Karl Marx: Mythos und Realität”. The event was organized and hosted by ECAEF – European Center of Austrian Economics Foundation.”