Unconventional monetary policy—characterized by “zero interest rate policy” (ZIRP) and “quantitative easing” (QE), along with macro-prudential regulation—has increased the power of central banks in the United States, Japan, and Europe. In the new issue of Cato Journal, contributors revisit the thinking behind unconventional monetary policy and the “new monetary framework,” make the case for transparent monetary rules versus foggy discretion, and point to the distortions generated by ultra-low interest rates and preferential credit allocation.
When the Danish newspaper Jyllands-Posten published the cartoons of the prophet Muhammad in 2005, Denmark found itself at the center of a global battle about the freedom of speech. The paper’s culture editor, Flemming Rose, defended the decision to print the 12 drawings, and he quickly came to play a central part in the debate about the limitations to freedom of speech in the 21st century. In The Tyranny of Silence, Flemming Rose provides a personal account of an event that has shaped the debate about what it means to be a citizen in a democracy and how to coexist in a world that is increasingly multicultural, multireligious, and multiethnic.
The Cato Institute has released its 2015 Annual Report, which documents a dynamic year of growth and productivity. The thousands of individuals who contribute to Cato are passionate about freedom and committed to ensuring that future generations enjoy the blessings of liberty, unencumbered by an overreaching state that seeks to control their lives. This is Cato’s optimistic vision for the future, and it would be unimaginable without the Institute’s longstanding partnership with its Sponsors. We will continue our diligence and dedication to seeing this vision realized.
Spending Cuts or Devaluation? Resolving the Financial Crisis in the Baltic Countries
Featuring Anders Aslund, Senior Fellow, Peterson Institute for International Economics; and Desmond Lachman, Resident Fellow, American Enterprise Institute; moderated by Marian L. Tupy, Policy Analyst, Center for Global Liberty and Prosperity.
In his new book, The Last Shall Be the First, Anders Aslund argues that the governments of the Baltic countries were right to respond to the 2008 financial crisis by slashing spending, while maintaining a fully fixed exchange rate between their domestic currencies and the euro. According to Aslund, this “internal devaluation” allowed the Baltics to quickly return to growth. Desmond Lachman contends that the sharp decline in the GDP in the Baltics in 2009 would not have happened if, instead of austerity measures, the Baltic governments had abandoned fixed exchange rates in favor of currency devaluation. Which of these two approaches is correct — and does the solution of the crisis in the Baltic countries hold any lessons for the United States and the European Union? Please join us for a spirited discussion.