Europe's Misguided Perception of Greece Is a Growing Threat to Progress
Europe’s still missing vision of Greece reasonably explains today why the great potential for economic growth of this southernmost member-state of the eurozone has been squandered in the past five years by disoriented technocrats. Mainly flourishing in Berlin, but directly mirrored in Brussels as well, they have been stubbornly persisting all along with a flawed policy of blind austerity. Showing in effect a deep aversion to government spending as a valid tool to fight economic slumps – and, in a clear break with Europe’s prosperous past, placing total faith instead in austerity-based policies of deregulated labor markets.
Albeit downgrading mainstream – core – western economic thinking in favor of poorly researched beliefs long ago proved anathema to sustaining aggregate effective demand in the Greek economy, the life-blood for any economy to grow. As Nobel Prize winner Paul Krugman has succinctly put it, “those supposed technocrats are in fact fantasists who have disregarded everything we know about macroeconomics, and have been wrong every step of the way. This isn’t about analysis, it’s about power – the power of the creditors to pull the plug on the Greek economy” (International NYT, 30 June 2015).