Posts Tagged ‘Austerity is not working’

Austerity is not working

February 3, 2015

You cannot keep on squeezing countries that are in the midst of depression. At some point there has to be a growth strategy. — President Obama

Austerity is not working, it is not working in Greece, it is not working in UK.

2010 debt in Greece was 125% of GDP. Five years on it is 175% of GDP.

Following World War One, Germany was squeezed. It was squeezed as punishment for losing WWI. The net result was rise of the Nazis and Adolf Hitler, six million Jews sent to death camps and World War Two.

Lessons were leant. Money was pumped into Germany to rebuild their economy.

But, lessons have not been learnt. Greece is being squeezed to extract the blood of every Greek, every Greek apart from corrupt politicians and tax dodging oligarchs.

Austerity does not work. Austerity is being used for Shock Doctrine, an excuse for slash and burn of public services, cut welfare payment, sell off state assets on the cheap.

Austerity does not work. Greek economy has shrunk by over 25%, unemployment at 25%, youth unemployment over 50%.

Money is lent, more money is lent to enable the interest to be paid.

No one will admit the debt has to be written off.

It is not possible for Greece to service its debt on a shrinking economy.

Except it is admitted. Economists have been saying for some years the debt has to be written off.

When a debtor has no means to repay, banks are peddling money, no different to drug dealers.

It is not for IMF, EU or Germany to tell a sovereign country how to restructure.

Economist Yanis Varoufakis, now Greek finance minster, is on a tour of Europe.

Yesterday it was the turn of George Osborne. One side an economist, on the other side a politician with no understanding of economics.

Yanis Varoufakis recognises Greece needs no more money, that Greece needs to restructure, but it is for Greeks to decide not EU or IMF and certainly not Germany.

It’s not that we don’t need the money, we’re desperate because of certain commitments and liabilities that we have.

We have resembled drug addicts craving the next dose. What this government is all about is ending the addiction.

When money was poured into Greece it did not find its way into the pockets of hard working Greeks. It was to bail out German banks and to grease the palms of corrupt Greek politicians.

Greece is not, as George Osborne has warned “fast becoming the biggest risk to the global economy”. The only risk is to corrupt political elites like George Osborne, who with his paymasters, risk being swept away on a tide of public anger.

Austerity was never about helping Greece it was about raping Greece and leaving the country destitute.

Yanis Varoufakis:

Freedom of speech in Greece has been jeopardized by this unholy alliance between bankrupt bankers, developers and media owners, who become the voice of those who want to sponge and scrounge off everyone else’s productive efforts.

We are going to destroy the basis upon which they have built, for decade after decade, a system and network that viciously sucks of the energy and the economic power from everybody else in society.

Alexis Tsipras:

We did not come here to take over institutions and to enjoy the trappings of power. We have come to radically change the way in which politics and governance is carried out in this country.

Last week, Greece’s new prime minister, Alexis Tsipras, visited a World War II National Resistance Memorial in his first outing as the country’s new leader. The memorial is located at the site where the Nazis executed 200 Greek communist resistance fighters in May 1944. During the recent campaign, Tsipras called on Germany to pay Greece reparations for damages incurred during the Nazi occupation. A 2013 governmental study determined Germany owed Greece an estimated $200 billion.

Is it not time Germany paid what it owes Greece?

Unemployment has many factors, unskilled, badly educated workforce (as we see in England), lack of demand.

In England, there is a tendency to bully and blame the unemployed for being unemployed, stigmatise, send on workfare boot camps to be humiliated, force to work for nothing, stop benefits on a whim. When what should happen, is recognise as an opportunity, treat as a sabbatical, provide bursaries for education or training.

We also have to recognise, if no demand, then no matter how skilled or educated the workforce (as in Greece) there will be no employment if the demand is not there.

Traditionally people went to work for an employer, more recently become an entrepreneur. There is now a third option, form Open Coops, that work collaboratively, that contribute to the Open Commons.

A Coop, may be worker owned or customer owned, but they operate as other competitive businesses. Open Coops are different, everyone who has an interest has a say, they cooperate with each other, they contribute to the Open Commons. that is they collaborate and share.

We have to reform our political institutions, so they are working for and owned by the people, democracy has to be participatory democracy, not the sham democracy we have at present.