90.9 WBUR - Boston's NPR news station
Top Stories:
PLEDGE NOW
China’s Price For Bailing Out the EU

The new China price. What China will ask for return for bailing out Europe, the EU.

European Union President Herman van Rompuy  speaks at the Central Party School in Beijing during his first visit to China. The agenda of the three-day visit in May 2011 included the Euro zone's debt crisis, trade and business agreements. Beijing is playing a critical role in buying troubled European debt. (AP)

European Union President Herman van Rompuy speaks at the Central Party School in Beijing during his first visit to China. The agenda of the three-day visit in May 2011 included the Euro zone's debt crisis, trade and business agreements. Beijing is playing a critical role in buying troubled European debt. (AP)

The global stakes and situation in Europe just get bigger and wilder. Last week, news of a mega-deal that would put a cork in the bottle of European financial chaos, contain the contagion. Now, Greece will go to the polls to vote on whether or not to take that pain. If the vote is no, who knows where we go.

Meanwhile, Europe’s first call after the deal was not to Washington, but to Beijing. They need Chinese cash – lots of it – to make this work. The US hasn’t got it. So here we are. Europe begging China for a bailout. And the planet’s power matrix turns.

This hour On Point: the China price for a bailout.

-Tom Ashbrook

Guests

Alkman Granitsas, bureau chief for Greece and Cyprus for Dow Jones Newswires and contributor to the Wall Street Journal.

Pieter Bottelier, adjunct professor of China Studies at the School of Advanced International Studies at Johns Hopkins University.

Arvind Subramanian, senior fellow at the Peterson Institute for International Economics, author of  “Eclipse: Living in the Shadow of China’s Economic Dominance.” His op-ed in the New York Times is “Why China Should Bail Out Europe.”

Clyde Prestowitz, is founder and President of the Economic Strategy Institute.

Highlights

The troubled economies of Europe have turned to a new economic backer: China. That represents a significant shift in the global power balance, experts contend.

“This would have been unthinkable 20 years ago. China is now in a position to exert enormous financial power,” said Pieter Bottelier, adjunct professor of China Studies at Johns Hopkins University.

But he cautioned that solving Europe’s economic woes won’t be easy. “There’s no question that China has the dough to solve these short-term financial problems, if there was a short-term financial problem. But it’s not. There is a profound structural design problem that only the Europeans can solve,” he said.

Bottelier also noted that a collapse of Europe as an export market for China would also be calamitous. China’s intentions should become clearer at the G-20 meeting coming up later this week in France.

“Europe is edging closer to the precipice,” said Arvind Subramanian, senior fellow at the Peterson Institute for International Economics. “It has to be China that comes to the rescue… They are the only country with the cash to do so.”

Subramanian said that China should aid Europe through the International Monetary Fund.

“This is less dramatic than what has been discussed….The Europeans have not tapped our their own resources, they have the ability to do more and they should,” noted Clyde Prestowitz, founder and President of the Economic Strategy Institute. “I don’t see China as the absolute key to saving Europe.”

From Tom’s Reading List

The New York Times “A day after European leaders unveiled their latest plan to save the euro, top officials opened talks with China in an effort to lure tens of billions of dollars in additional cash, giving China perhaps its biggest opportunity yet to exercise financial clout in the Western world. ”

Financial Times “Analysts said that in an environment of cautiously positive risk sentiment nervous investors had clung to their Japanese assets, preferring to sell dollar holdings into periods of inflated risk appetite on speculation that the US Federal Reserve will venture back down the path of quantitative easing.”

Project Syndicate “The debt crisis in Europe is no longer a European affair. Coupled with fears of a double-dip recession in the United States, the European debt crisis is dragging the global economy into another cycle of financial panic and economic recession.”

Please follow our community rules when engaging in comment discussion on this site.
ONPOINT
TODAY
Oct 30, 2014
Realtor Helen Hertz stands in front of one of her listings in Cleveland Heights, Ohio Friday, Oct. 24, 2014. Hertz, a real estate agent for more than three decades, has seen firsthand what has happened to the market in the wake of the recession and foreclosure crisis. (AP)

Home ownership rates are at a 20-year low. Millennials and more aren’t buying. We’ll look at what American’s think now about owning a home.

Oct 30, 2014
Soylent is a new meal-replacement substance meant to offer a complete nutritional alternative to traditional food. (Courtesy Soylent)

Soylent is a grey smoothie the consistency of pancake batter that claims it can replace all your food. On a crowded planet, is this the future of food? Plus: what does the Antares rocket crash mean for private space travel?

RECENT
SHOWS
Oct 29, 2014
A visitor looks at the simple wooden cross that marks the grave of Welsh poet and playwright Dylan Thomas, in Laugharne, Wales, Sept. 17, 1963. (AP)

A century after his birth, poet and writer Dylan Thomas lives on. We look at his exuberant work and short life.

 
Oct 29, 2014
In this Tuesday, Oct. 1, 2013 image provided by the Utah Division of Wildlife Resources, a young bear is rescued from drowning after eluding officials, at Lake Powell, Utah. (AP)

A big debate in the West over transferring Federal public lands to states. We’ll hear from both sides.

On Point Blog
On Point Blog
The Explicast, Episode Two: Why Is Election Day On A Tuesday?
Friday, Oct 24, 2014

The Explicast is back for another round. This time, we’re looking at Election Day, and why we all keep voting on a random Tuesday in early November.

More »
2 Comments
 
Our Week In The Web: October 24, 2014
Friday, Oct 24, 2014

On comments, comment sections, and ROY G BIV.

More »
Comment
 
Introducing The Explicast: A New Podcast From On Point Radio
Friday, Oct 17, 2014

Confused about the news? Don’t worry: so are we sometimes! Introducing a new On Point Radio podcast: The Explicast. You can find Episode One right here.

More »
3 Comments