Hello everyone welcome to the first Q & A Friday. This week’s question comes all the way from Mardid, Spain, from my good friend Tim Zahner.
Q: Tomorrow is a general strike here in Madrid, protesting the government. Obviously, I support the general idea of striking and public protest. But, on the more individual level – one more person amidst of a crowd of thousands doesn’t do much. Am I (pretend I’m a Spanish dude) better served working tomorrow or trying to earn a buck, or joining in on the protest?
A : An interesting hypothetical here. I am of course all for public expression of opinion as well, but this is not simple right or wrong issue. If I said no matter what you should go to the protest, then I am ignoring your opportunity cost for being there. Without knowing how much you make, how much savings or debt you have, and how many dependents you have, I cannot really answer the question.
Having said that, knowing you as a student without many extra obligations, you are the target demographic to get out there and protest. It’s kind of why I made this blog in the first place, because I have free time and want my opinions to be heard.
And thats where you get your protestors and silent (financial) supporters from. Regardless of what you do, if you feel strongly about an issue you can make a difference. Donate your time, or donate your money. If your someone with free time, actually getting involved in the protest probably suits you best. If your making a lot of money and a lot of people depend on you, donating some of your income is probably more responsible.
I would not be suprised if the turnout for the protests in Spain offers a much wider variety of people from what you would usually expect. With around 25% unemployment, a large variety of people will get out and make their voices heard.
Having said this, the economics of the larger issue is clear. With the fiscal multiplier (basically how much 1 euro of government spending affects the economy) > 1, the ECB (European Central Bank) should not be insisting on austery (cutting fisal deficits), in exchange for bond buying programs (to help governments deal with their soveriegn debt issues). If Spain, or any EU country was not in the EU, they could just print the money themselves. But as it is they cannot, so they need the ECB to do so (without imposing cuts that will shrink the economy and cause the debt/GDP ratio to actually go up despite cutting social programs). The Spainish government, or all the GIPSI governments (Greece, Italy, Spain, Portugal, Ireland; heavily indebted EU countries), along with the IMF should be pressuring the ECB to rethink its position. The government’s are obligated because they exist to the uphold the will of their people; the IMF is obligated becuase it published the report saying the fiscal multiplier was >1, if you write the report you gotta get behind it).
But you didn’t ask about that so I won’t mention it.
Lets get more questions for next week, or maybe I will stick to focusing on one question, I kind of like that too. I guess I’ll have to see what next week has in store for NN.
I’m basically mentally checkout out for the holidays, which is probably premature, but whatever. Have a good weekend everyone see you all on Monday with some sports analysis (Monday Morning QB) and some sorta interesting current event issue from over the weekend.
Normative Narratives 