Unfortunately the Greek crisis is now all about politics in the countries that lent the money. That money, or a goodly chunk of it at least, is already gone. The continued economic devastation of Greece isn’t about getting the money back; it’s about not having to admit that the money is gone. That isn’t the way to run a continent, is it?
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Samizdata quote of the dayMay 2nd, 2017 |
 8 comments to Samizdata quote of the day |
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I think people who think Brexit is unambiguously stupid should always be challenged on what they think is clever. Why is it clever either to throw our lot in with the Eurozone or stay out and risk getting pointlessly swept up in whatever political stunt they engage in to make it work next?
Generally they can’t tell you because the Eurozone crisis is something that’s happening to foreigners.
The Evening Standard thinks Brexit is a “historic error”. I think history will come to rank the Euro with the world wars as the destroyers of European relevance.
Well, if the Euro is so good, how come it is not the reserve currency of the world, by now? The only way to make it relevant would be to link it to some metal, like gold and/or silver and/or platinum, but some politicians want a currency they can arbitrarily control.
Any chance of Mat deciding to have a metal-backed pound?
Who underwrites the Euro?
Getting money back when it has been spent is a bit like trying to get back the energy from burnt coal, the process of entropy is not reversible. Coal can at least keep you warm, whereas government spending generally keeps things that are uneconomic going and takes us further from economic reality.
And Greece is only around ten million people, as is Portugal, what about Italy and Spain and their vanished billions?
The post leaves out the fact that the welfare benefits and “public services” of Greece are unsustainable.
Allowing the Greek government to default on its debts would NOT change that fact.
The economic devastation of Greece has got naught to do with “banksters” or the rest of the stuff that Mr Putin’s “RT” blames it on – it is due to the Big Government policies of Greece, the wild government spending (in proportion to the small economy) and the endless regulations.
An excellent article. What Worstall omits (and I don’t fault him for this; there’s only so much detail you can pack into an eye-glazing article about international economics) is something which was touched upon here recently in another thread: the fact that so much Greek debt is on the books of European commercial banks, carried at full face value with zero capital to support it. A Greek default would destroy the capital base of nearly all European banks and force them into receiverships which the ECB couldn’t possibly handle. It’s a ticking time bomb. If only for this reason alone, in my opinion Brexit can’t happen too soon. You want to get out before the building completely collapses.
I disagree to some extent with Paul Marks (May 3, 2017 at 1:13 pm). The Greek government is (by its own and predecessors’ fault) caught between a rock and a hard place: being trapped in the euro, they cannot devalue their currency relative to e.g. Germany, but there are deep-seated political and even cultural reasons why they cannot effect the reforms the Germans press on them in any relevant political timescale (or indeed at all, as regards this generation and probably several subsequent ones).
Obviously I agree with Laird (May 3, 2017 at 4:23 pm above, and both of us in the thread he links to) that the accounting of Greek (and other EU governments’) debt at its full nominal value on the books of Greek and other EU banks is – now what is the word I’m looking for – injudicious? unfortunate? inappropriate? – I know, let’s describe it as “not as risk-free as the rule that mandates this says it is”.
(Although a Scot, I like using English understatement when overstatement would be hard. 🙂 )
Wait…wait…..how many refugees seeking political asylum from the middle East are flooding into Greece?
While the EU’s problem child acts out again, refusing to pull it’s own weight in the clubhouse it should NEVER have been admitted to…(“We NEED more dependents and slaves)!!!!!
The US has a problem with ANOTHER of it’s OWN problem children, “adopted” from Spain’s collapsed empire.
Puerto Rico…in default, bankruptcy, “Nothing personal,it’s just…economics”!
I wonder why Dominican Republic does so much better than Haiti, despite “the world” shoveling “aid”, T-shirt people, or with SOME International Family Charitable Foundations… “expert” activism.
DR must have been the middle child. Greece? Yeah, “Big Thinkers”!!!!
Gunga Din carried water, Ari Onassis carried freight. (30 years ago anyway) Dominicans are the best auto body repair craftsmen in New York City.