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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPaul Krugman:Ending Greece’s Nightmare
Alexis Tsipras, leader of the left-wing Syriza coalition, is about to become prime minister of Greece. He will be the first European leader elected on an explicit promise to challenge the austerity policies that have prevailed since 2010. And there will, of course, be many people warning him to abandon that promise, to behave responsibly.
So how has that responsibility thing worked out so far?
To understand the political earthquake in Greece, it helps to look at Greeces May 2010 standby arrangement with the International Monetary Fund, under which the so-called troika the I.M.F., the European Central Bank and the European Commission extended loans to the country in return for a combination of austerity and reform. Its a remarkable document, in the worst way. The troika, while pretending to be hardheaded and realistic, was peddling an economic fantasy. And the Greek people have been paying the price for those elite delusions.
You see, the economic projections that accompanied the standby arrangement assumed that Greece could impose harsh austerity with little effect on growth and employment. Greece was already in recession when the deal was reached, but the projections assumed that this downturn would end soon that there would be only a small contraction in 2011, and that by 2012 Greece would be recovering. Unemployment, the projections conceded, would rise substantially, from 9.4 percent in 2009 to almost 15 percent in 2012, but would then begin coming down fairly quickly.
(snip)
So now that Mr. Tsipras has won, and won big, European officials would be well advised to skip the lectures calling on him to act responsibly and to go along with their program. The fact is they have no credibility; the program they imposed on Greece never made sense. It had no chance of working.
more at link
http://www.nytimes.com/2015/01/26/opinion/paul-krugman-ending-greeces-nightmare.html?ref=opinion
Enthusiast
(50,983 posts)They're on my TV every day on Fox "News".
We don't have to go to Europe to find them.
stillwaiting
(3,795 posts)And, those "elite delusions" have been devastating for everyone else (as intended).
I remain flummoxed that just about everyone in the media gives the elite the benefit of the doubt that the elite's intentions are well-intended for the masses.
It doesn't make sense to me. WHY does that continue to be the firmly entrenched status quo that continues to get bandied about?
malthaussen
(17,202 posts)It is amazing, isn't it? Any grownup should understand that the rich want to get richer and don't care a fig for anyone else. Yet we persist in believing the fairy tale that our ruling class has our best interests at heart. "Class war" is a red flag to almost everyone. Which is pretty naive, since it is ongoing and The People are losing.
Ah, well. Vote for Hillary, right?
-- Mal
riderinthestorm
(23,272 posts)MannyGoldstein
(34,589 posts)It's time for the world's 99% to eat their peas. Raw, so we don't waste money on fuel.
Fortunately, America's politicians all laugh at that crazy-eyed professor, who's unfit to even be household help for real economists like Larry Summers.
Regards,
TWM
jwirr
(39,215 posts)Greece. Mr. Krugman is correct. The trickle down theory did not work and things got worse instead of better. And where there is poverty there is anger and where there is anger there is a breeding ground for terrorists. EU had better take its terror breeding troika and dump it fast.
Greece has over the years experienced many forms of government and they are remembering that it is better to move left than it is to move right.