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Archive for the ‘In Defense of Deficits’ Category

By George Soros. Published: June 24 2010.

Germany used to be at the heart of European integration. Its statesmen used to assert that Germany had no independent foreign policy, only a European policy. After the fall of the Berlin Wall, its leaders realised that German reunification was possible only in the context of a united Europe, and they were willing to make some sacrifices to secure European acceptance. Germans would contribute a little more and take a little less than others, thereby facilitating agreement.

Those days are over. The euro is in crisis, and Germany is the main protagonist. Germans don’t feel so rich any more, so they don’t want to continue serving as the deep pocket for the rest of Europe. This change in attitude is understandable, but it has brought the European integration process to a halt.

By design, the euro was an incomplete currency at its launch. The Maastricht treaty established a monetary union without a political union – a central bank, but no central treasury. When it came to sovereign credit, eurozone members were on their own.

This fact was obscured until recently by the European Central Bank’s willingness to accept the sovereign debt of all eurozone members on equal terms at its discount window. As a result, they all could borrow at practically the same interest rate as Germany. The banks were happy to earn a few extra pennies on supposedly risk-free assets and loaded up their balance sheets with the weaker countries’ government debt.

The first sign of trouble came after the collapse of Lehman Brothers in September 2008, when the European Union’s finance ministers decided, at an emergency meeting in Paris that October, to provide a virtual guarantee that no other systemically important financial institution would be allowed to default. But German chancellor Angela Merkel opposed a joint EU-wide guarantee; each country had to take care of its own banks.

At first, financial markets were so impressed by the guarantee that they hardly noticed the difference. Capital fled from the countries that were not in a position to offer similar guarantees, but interest-rate differentials within the eurozone remained minimal. That was when countries in eastern Europe, notably Hungary and the Baltic states, got into trouble and had to be rescued.

It was only this year, when financial markets started to worry about the accumulation of sovereign debt, that interest-rate differentials began to widen. Greece became the centre of attention when its new government revealed that its predecessors had lied about the size of the 2009 budget deficit.

European authorities were slow to react, because eurozone members held radically different views. France and other countries were willing to show solidarity, but Germany, traumatised twice in the 20th century by runaway prices, was allergic to any build-up of inflationary pressures. (Indeed, when Germany agreed to adopt the euro, it insisted on strong safeguards to maintain the new currency’ s value, and its constitutional court has reaffirmed the Maastricht treaty’s prohibition of bail-outs.)

Moreover, German politicians, facing a general election in September 2009, procrastinated. The Greek crisis festered and spread to other deficit countries. When European leaders finally acted, they had to provide a much larger rescue package than would have been necessary had they moved earlier. Moreover, in order to reassure the markets, the authorities felt obliged to create the €750bn European Financial Stabilisation Facility, with €500bn from the member states and €250bn from the International Monetary Fund.

But the markets have not been reassured, because Germany dictated the terms of the rescue and made them somewhat punitive. Moreover, investors correctly recognise that cutting deficits at a time of high unemployment will merely increase unemployment, making fiscal consolidation that much harder. Even if the budget targets could be met, it is difficult to see how these countries could regain competitiveness and revive growth. In the absence of exchange rate depreciation, the adjustment process will depress wages and prices, raising the spectre of deflation.

The policies currently being imposed on the eurozone directly contradict the lessons learnt from the Great Depression of the 1930s, and risk pushing Europe into a period of prolonged stagnation or worse. That, in turn, would generate discontent and social unrest. In a worst case scenario, the EU could be paralysed or destroyed by the rise of xenophobic and nationalist extremism.

If that were to happen, Germany would bear a major share of the responsibility. Germany cannot be blamed for wanting a strong currency and a balanced budget, but as the strongest and most creditworthy country, it is unwittingly imposing its deflationary policies on the rest of the eurozone. The German public is unlikely to recognise the harm German policies are doing to the rest of Europe because, the way the euro works, deflation will serve to make Germany more competitive on world markets, while pushing the weaker countries further into depression and increasing the burden of their debt.

Germans should consider the following thought experiment: withdrawal from the euro. The restored Deutschemark would soar, the euro would plummet. The rest of Europe would become competitive and could grow its way out of its difficulties but Germany would find out how painful it can be to have an overvalued currency. Its trade balance would turn negative, and there would be widespread unemployment. Banks would suffer severe losses on exchange rates and require large injections of public funds. But the government would find it politically more acceptable to rescue German banks than Greece or Spain. And there would be other compensations; German pensioners could retire to Spain and live like kings, helping Spanish real estate to recover.

Of course, this is purely hypothetical because, if Germany were to leave the euro, the political consequences would be unthinkable. But the thought experiment may be useful in preventing the unthinkable from actually happening.

The writer is chairman of Soros Fund Management

FT.com / Comment – Germany must reflect on the unthinkable.

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Festina lente – hurry slowly – is advice we have inherited from the ancient Romans. Western policymakers should now take it to heart. Confronted with huge fiscal deficits, many have concluded that they should hurry fiscal tightening on as fast as possible, in the hope that it will prove expansionary. What are the chances that they will be right? Small, I believe. Moreover, rather better alternatives are on offer. But their drawback is that they are unorthodox: alas, many “sound” people prefer orthodox recessions to unorthodox recoveries.

Why might a sharp structural fiscal tightening promote recovery? As Harvard’s Alberto Alesina and Silvia Ardagna note in an influential paper, smaller prospective deficits may improve confidence among consumers and investors, thereby raising consumption and lowering risk-premia in interest rates.* Meanwhile, on the supply side, fiscal tightening may increase supply of labour, capital or entrepreneurship. The broad conclusions of their paper are that fiscal adjustments “based upon spending cuts and no tax increases are more likely to reduce deficits and debt over gross domestic product ratios than those based upon tax increases. In addition, adjustments on the spending side rather than on the tax side are less likely to create recessions.” This line of argument has strengthened the will of George Osborne, the UK’s new chancellor of the exchequer.

Is it persuasive? In a word: no. The authors group together data for members of the Organisation for Economic Co-operation and Development between 1970 and 2007. But the impact of fiscal tightening is going to depend on circumstances.

A reduction in the fiscal deficit must be offset by shifts in the private and foreign balances. If fiscal contraction is to be expansionary, net exports must increase and private spending must rise, or private savings fall. Thus, experience of fiscal contraction is going to be very different when it occurs in a few small countries, not in many big ones simultaneously; when the financial sector is in good health, not impaired; when the private sector is unindebted, not highly leveraged; when interest rates are high, not close to zero, when external demand is buoyant, not feeble; and when real exchange rates depreciate sharply rather than remain fixed.

In short, when, as now, the economies affected by financial sector fragility make up half of the world economy (indeed, together with the still feeble Japanese economy, close to 60 per cent); when the most dynamic large economy in the world – China – is mercantilist; when interest rates are near zero; and when businesses and households are credit-constrained, the view that an early fiscal tightening will prove strongly expansionary is surely heroic. I hope it will be true. But there is little reason to believe it.

Another study, by the US Committee for a Responsible Federal Budget, examined the cases of Canada, Denmark, Finland, Ireland and Sweden. What emerges is the importance of external demand and, in several cases, of huge exchange rate depreciations (see chart). Are these successful examples really relevant to the US and European Union today? I very much doubt it.

Yet another approach is to find a situation that is indeed quite like today’s. The closest parallel is the 1930s, in terms of the proportion of the world economy affected by the crisis, the low interest rates and the disinflationary (or, in that case, deflationary) background. A study published last year concluded that fiscal stimulus was effective when tried.** It follows that fiscal tightening would have been – indeed was – contractionary at that time.

In current circumstances, the belief that a concerted fiscal tightening across the developed world would prove expansionary is, to put it mildly, optimistic. At this stage, I will inevitably be asked: what is the alternative? If these huge deficits continue, markets will take fright, interest rates will jump and the debt dynamics will become truly awful.

I have two responses to this.

The first, one I made a week ago, is that the deleveraging cycle is generating huge private sector financial surpluses across the developed world. Unless we expect a shift into aggregate external surpluses (and corresponding deficits in the emerging world), these surpluses must now to be invested in government liabilities. This helps explain why yields on the bonds of safer governments remain so low.

The second response is that if governments need to run deficits, to support demand at a time of private sector weakness, they can always borrow from central banks. Yes, this is “printing money”. It is also an insanely radical policy recommended by no less insane a radical than Milton Friedman, back in 1948. His view was that the government could expand the money supply during recessions and contract it in the subsequent booms. A country with a fiat currency and a floating currency could, thus, stabilise the economy without destabilising credit markets. The neat thing about this proposal is that one does not have to decide whether fiscal policy or monetary policy is doing the heavy lifting: they are two sides of one coin.

The argument for aggressive monetary expansion remains strong, though not equally everywhere, since the growth of broad money and nominal GDP is weak (see chart). So Friedman’s policy of “quantitative easing”, as it is called, still makes good sense. Am I recommending the economics of Robert Mugabe? No. As in everything else, it is the context that matters. At present, we have “too little money chasing too many goods”. In this environment, monetary policy must be aggressive. When the economy recovers, the monetary effects should be withdrawn, via budget surpluses obtained via long-term control over spending. In the short term, changes in reserve requirements can offset the impact on monetary expansion of the rise in deposits of commercial banks at the central bank. Since, in practice, the money supply is driven more by the demand for credit than reserves, this may be unnecessary.

The conventional wisdom is that a strong and co-ordinated structural fiscal contraction, focused on spending, will promote the growth of a thousand private blooms. I hope this will prove true. But I doubt it. Governments should hurry slowly. If they all hurry quickly, they – and we – may regret it nearly as soon.

* Large changes in fiscal policy, working paper 15438, www.nber.org

** Almunia et al, The effectiveness of fiscal and monetary stimulus in depressions, www.voxeu.org

martin.wolf@ft.com

FT.com / Columnists / Martin Wolf – Why it is right for central banks to keep printing.

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Thank God for José Luis Rodríguez Zapatero, the Spanish prime minister. For the first time in the three years since the outbreak of the financial crisis, a European leader has done something intelligent and surprising. Spain’s unilateral decision to publish the stress tests of its banks has bounced the European Union – at a summit in Brussels last Thursday – into following a Spanish lead, and to accept an uncharacteristic degree of transparency.

Does this mean that we are about to get on top of this wretched crisis? Well, so far, the EU has agreed to publish the stress tests of only 25 banks. They are not the main problem banks in the eurozone. There is a good chance that governments will extend those tests to other banks. But it is no reason to get too excited.

The fundamental problem is that governments are still fighting the wrong crisis. Global investors have recognised a fundamental truth, that this is not a sovereign debt crisis at heart, as Germany and the European Central Bank keep on telling us, but a banking crisis and a crisis of policy co-ordination failures.

Since the banks are guaranteed by their respective governments, most private debt is ultimately public debt. The European Central Bank and the newly created European Financial Stability Facility – the €440bn ($545bn, £368bn) special purpose vehicle to stabilise the European bond markets – will absorb billions of euros of junk debt which, on default, would trigger a massive redistribution of income from northern Europe to southern Europe. So far, this crisis has cost European taxpayers nothing. But that would change if, or when, some of the Greek debt gets restructured. That will not happen for three years. But, by then, most of that Greek debt would wind up in the hands of the EFSF and the ECB. A default at that point would confront the EU with a binary decision: either to go for fiscal union, or to break up. The investors do not know which way the EU will jump. Nobody does.

One conceivable strategy for getting out of this mess is to remove the lingering doubts about the banking sector. Except for Greece, the sovereign debt situation is under control everywhere. The problem is not the actual government debt, but the contingent debt, most of which is located in the banking sector. If there is more transparency about the banking sector, the situation would be eased.

If the publication of the stress tests would lead to a process of bank recapitalisation, we would be well on the way. But I do not see it. Germany’s bad bank scheme is so incredibly unattractive that hardly any banks have taken it up. Yet, the German government is in no position to force the banking sector to accept new capital. The Landesbanken – probably the biggest financial toxic waste dumps on earth – are controlled by the state governments.

The situation is not much better in Spain, where the Bank of Spain is already pushing hard for a consolidation of the cajas, the local savings banks. We will no doubt get a lot more bad news from the Spanish banking sector, as Spain goes through the adjustment. Having been sceptical about Mr Zapatero’s willingness to do what needs to be done, I am a touch more optimistic now. His recently decreed labour market reforms are a step in the right direction, but probably insufficient.

Elsewhere in the eurozone, there are several other trouble spots. France also has its share of poorly capitalised banks, and so do Austria and Belgium.

Uncertainty will persist, until we have a reliable estimate of the remaining toxic waste in bank balance sheets, and some resolution trajectory. The only information that was ever leaked in Germany was a worst-case estimate by the banking regulator a year ago of a total write-down volume of €800bn, about a third of Germany’s annual gross domestic product. I have no idea what the number would be today.

To resolve this crisis, we need to know those numbers and a lot more. Most importantly, the EU must set up a workable system of economic policy co-ordination, including a strategy to deal with resurgent internal imbalances. On that point, we are actually regressing.

The decision to publish the stress tests masked an otherwise disappointing European summit. After months of debate, all the European Council had to show was another stability pact and another Lisbon agenda – a now defunct growth initiative. One of the lessons of the early stability pact – from 1999 until 2003 – was that sanctions do not work, because they cannot be applied in the real world. The revised stability pact, agreed in 2005, moved away from an emphasis on sanctions to incentives. The idea was sound, but ultimately failed because of insufficient policy co-ordination. The decision to revert to the original sanctions-based approach is silly. If sanctions do not work, then surely, lots of sanctions are not going to work either. As for the Lisbon agenda, it is now called Agenda 2020, and it is just as hopeless.

What has become clear in the last few months is that Herman Van Rompuy, the president of the European Council, is not providing sufficient leadership to move the process forward. Without a plausible end game in sight, I would expect investors to continue to place bets on the eurozone’s demise.

via FT.com / Columnists / Wolfgang Münchau – We need the figures on Europe’s toxic banks.

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The great German physicist Max Planck remarked that “science advances one funeral at a time.” The situation is worse in economics, which is subject to regress, as happened when the valuable but imperfect insights of Keynesianism were supplanted by the ideological blinkers of neo-liberalism.

The effects of this regress have again been on display in the confused discussions and policy responses to Europe’s sovereign debt crisis. The fact is that countries which borrow in their own currency and control their money supply will never default because they can always issue the money needed to repay their debts.

For such countries, central banks should respond to speculative debt crises with “bear squeeze” tactics that have them buy existing debt. In this fashion, countries can buy back debt below par value, in effect repaying it on the cheap. It is what the European Central Bank should have been doing on behalf of its member countries.

Not only does a bear squeeze assist debt reduction, it also punishes speculators and lowers interest rates, enabling countries to refinance on favourable terms. In a sense, this is what the Bank of England and the Federal Reserve have been doing on behalf of their respective governments by buying gilts and treasuries. Though such policy does increase the money supply, this is desirable at a time of big demand shortage and excess capacity when inflation is a distant danger.

The eurozone has cheated itself of these benefits because of the neo-liberal design of the ECB. That design ignores the fact that having central banks act as the government’s banker and to help manage the national debt was one of the original reasons for the establishment of central banks. This is no accident as neo-liberalism intentionally aimed to sever the fiscal – monetary policy link, but in doing so it discarded an essential tool of macroeconomic management.

The most damaging aspect of the crisis is the global boost it has given to the arguments of those advocating fiscal austerity. That is a cure which will almost certainly kill the patient by causing deep recession that lowers tax revenues and aggravates budget difficulties, while also causing bankruptcies that threaten an already weakened banking sector.

Governments cannot limitlessly increase debt and the money supply without cost. If such policies were continued, once the economy was back to normal there would eventually be a price to pay in the form of higher inflation and reduced confidence in money as a store of value. That means there is need to design policies and institutional arrangements that guard against such an outcome. But that is a wholly different proposition from saying governments and central banks should not use their powers to create money to addressing problems of excessive debt, speculation, financial panic and deep recession.

Central banks were slow to adopt quantitative easing (QE) to address the run on the financial sector in 2008 when money markets froze and banks could not refinance. That cost the global economy dearly. Now, the mistake is being repeated in the eurozone with the slow embrace of QE to address the run on public debt.

Europe, and perhaps the global economy, again confronts the possibility of a run for liquidity. In such circumstances there is only one thing for central banks to do: supply it. Keynes wrote of this in his masterful General Theory:

“Unemployment develops, that is to say, because people want the moon; — men cannot be employed when the object of desire (i.e. money) is something which cannot be produced and the demand for which cannot be readily choked off. There is no remedy but to persuade the public that green cheese is practically the same thing and to have a green cheese factory (i.e. a central bank) under public control.”

Yet, policy continues to respond with too little, too late, and then goes on to compound the damage with inappropriately timed austerity and doubling-down on policies of wage suppression that have already wrought such havoc.

The root problem is the dominance of flawed neo-liberal economic thinking. This problem is particularly acute in the ECB and European finance ministries which are dominated by economists trained in Chicago School neo-liberal macroeconomics. Ironically, social democratic Europe has been much more virulently infected by this strain of thinking than the US where politicians’ pragmatism has moderated economists’ extremism.

The Great Recession may have lowered economists’ public standing but it has not yet changed their thinking or swept away the top policy appointees who have failed so disastrously. When it comes to economics, Max Planck was too optimistic about scientific progress.

By Thomas Palley who is Schwartz Economic Growth Fellow at the New America Foundation

FT, May 23, 2010

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In truth, Greece does have an alternative. Instead of submitting to the ferocious and pro-cyclical conditionality imposed by Germany and the IMF – cutting its budget deficit by 11% over three years in return for a €120bn (£104bn) loan – it could follow Argentina’s example in 2001-02, and default on the bulk of its sovereign debt. This would mean abandoning the euro, introducing a “new drachma” and probably devaluing by 50% or more.

Some weeks ago, I had a private exchange about this scenario with Mark Weisbrot of the Centre for Economic Policy Research in Washington. He favoured Argentinian-style default; I did not. But given Angela Merkel’s politically motivated foot-dragging, the failure of the European Central Bank to deal with the problem at an earlier stage and the strongly pro-cyclical nature of the cuts required, I am having second thoughts.

Eight years ago, Argentina defaulted on the major part of its sovereign debt and survived quite well. Many economists predicted that Argentina’s debt default would result in currency collapse, hyperinflation and even greater economic contraction than it had endured during its 1999-2002 recession. Instead, after the 2001-02 debt default and subsequent devaluation against the dollar (from 1:1 to 3:1), GDP grew at over 8% per annum over the period 2003-2007 and annual inflation fell from over 10% per month in early 2002 to less than 10% per annum. By 2005, Argentina had sufficient reserves to allow President Néstor Kirchner to pay off its remaining $9.8bn (£6.4bn) loan from the IMF in full and discontinue its programme with them.European leaders would do well to read up on the Asian, Russian and Latin American financial crises of 1997-2002. The Nobel laureate Joseph Stiglitz famously published an open letter citing his reasons for resigning from his post of chief economist at the World Bank. Among his criticisms of the bank and the IMF was the imposition of drastic deflationary measures on Thailand and Korea in 1997, and on Russia in 1998, mainly to protect the balance sheets of private western banks. The conditionality imposed was paid for dearly by cuts in economic and social expenditure thrust on ordinary citizens.

A central lesson of all this is that unless protective action is taken early, a country can rapidly be overpowered by the financial markets. Once traders start betting against a country’s bonds or its currency, the herd instinct takes over. Greece’s budget deficit is not particularly high by world standards – 13.6% versus 11% in the UK, and 12.3% in the US. But traders perceived its sovereign debt structure as too risky and prophecies of doom became self-fulfilling. There is a further problem. The spending cuts needed to meet the government’s deficit target will undermine Greek government revenues. As an economist at London-based Capital Economics put it: “The key risk to its target is that deeper recession will lead to lower tax revenues, offsetting some of the savings that the government expects to make as a result of its fiscal tightening.” In short, even though the bailout package has been agreed, the cuts may prove counterproductive and Greek recovery is far from assured.

The ECB could have nipped this crisis in the bud several months ago, both by continuing to accept Greek government bonds as collateral and by quantitative easing. Although the ECB had used quantitative easing to bailout the EU banking system, it refused to do so for Greece. There are clear signs that contagion is spreading to Portugal, and possibly to Spain and Italy. Can the ECB really be counted on in future to prevent the gradual unravelling of the euro?

As the French economist Jean-Paul Fitoussi argued in a recent interview in Libération, even if the Greek crisis is successfully contained for a time by an EU-IMF package, the financial markets will hope to profit by squeezing other European countries. Meanwhile, ordinary Greeks are taking to the streets to protest against further draconian austerity measures, while the EU’s political class continues to focus entirely on its narrow domestic interests. Here in Britain, a bemused electorate apparently has not yet woken up to the nature and magnitude of the cuts we will almost certainly suffer as a result of the 2008 bank bailout. Most important, we have not begun to question seriously whether placating the financial markets by means of such cuts is unavoidable. Perhaps it’s time to start thinking the unthinkable: namely, that financial markets should be our servants, not our masters.

George Irvin, guardian.co.uk, Sunday 2 May 2010

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“The Simpson-Bowles Commission, just established by the president, will no doubt deliver an attack on Social Security and Medicare dressed up in the sanctimonious rhetoric of deficit reduction. (Back in his salad days, former Senator Alan Simpson was a regular schemer to cut Social Security.) The Obama spending freeze is another symbolic sacrifice to the deficit gods. Most observers believe neither will amount to much, and one can hope that they are right. But what would be the economic consequences if they did? The answer is that a big deficit-reduction program would destroy the economy, or what remains of it, two years into the Great Crisis.

For this reason, the deficit phobia of Wall Street, the press, some economists and practically all politicians is one of the deepest dangers that we face. It’s not just the old and the sick who are threatened; we all are. To cut current deficits without first rebuilding the economic engine of the private credit system is a sure path to stagnation, to a double-dip recession–even to a second Great Depression. To focus obsessively on cutting future deficits is also a path that will obstruct, not assist, what we need to do to re-establish strong growth and high employment.

To put things crudely, there are two ways to get the increase in total spending that we call “economic growth.” One way is for government to spend. The other is for banks to lend. Leaving aside short-term adjustments like increased net exports or financial innovation, that’s basically all there is. Governments and banks are the two entities with the power to create something from nothing. If total spending power is to grow, one or the other of these two great financial motors–public deficits or private loans–has to be in action.

For ordinary people, public budget deficits, despite their bad reputation, are much better than private loans. Deficits put money in private pockets. Private households get more cash. They own that cash free and clear, and they can spend it as they like. If they wish, they can also convert it into interest-earning government bonds or they can repay their debts. This is called an increase in “net financial wealth.” Ordinary people benefit, but there is nothing in it for banks.

And this, in the simplest terms, explains the deficit phobia of Wall Street, the corporate media and the right-wing economists. Bankers don’t like budget deficits because they compete with bank loans as a source of growth. When a bank makes a loan, cash balances in private hands also go up. But now the cash is not owned free and clear. There is a contractual obligation to pay interest and to repay principal. If the enterprise defaults, there may be an asset left over–a house or factory or company–that will then become the property of the bank. It’s easy to see why bankers love private credit but hate public deficits.

All of this should be painfully obvious, but it is deeply obscure. It is obscure because legions of Wall Streeters–led notably in our time by Peter Peterson and his front man, former comptroller general David Walker, and including the Robert Rubin wing of the Democratic Party and numerous “bipartisan” enterprises like the Concord Coalition and the Committee for a Responsible Federal Budget–have labored mightily to confuse the issues. These spirits never uttered a single word of warning about the financial crisis, which originated on Wall Street under the noses of their bag men. But they constantly warn, quite falsely, that the government is a “super subprime” “Ponzi scheme,” which it is not.

We also hear, from the same people, about the impending “bankruptcy” of Social Security, Medicare–even the United States itself. Or of the burden that public debts will “impose on our grandchildren.” Or about “unfunded liabilities” supposedly facing us all. All of this forms part of one of the great misinformation campaigns of all time.

The misinformation is rooted in what many consider to be plain common sense. It may seem like homely wisdom, especially, to say that “just like the family, the government can’t live beyond its means.” But it’s not. In these matters the public and private sectors differ on a very basic point. Your family needs income in order to pay its debts. Your government does not.

Private borrowers can and do default. They go bankrupt (a protection civilized societies afford them instead of debtors’ prisons). Or if they have a mortgage, in most states they can simply walk away from their house if they can no longer continue to make payments on it.

With government, the risk of nonpayment does not exist. Government spends money (and pays interest) simply by typing numbers into a computer. Unlike private debtors, government does not need to have cash on hand. As the inspired amateur economist Warren Mosler likes to say, the person who writes Social Security checks at the Treasury does not have the phone number of the tax collector at the IRS. If you choose to pay taxes in cash, the government will give you a receipt–and shred the bills. Since it is the source of money, government can’t run out. (…)”

See full article > In Defense of Deficits, By James K. Galbraith

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