[np] Austerity is not Greece's Problem (Ricardo Hausmann)
Kai Frederik Lorentzen
lorentzen at hotmail.de
Tue Jul 7 06:14:01 CDT 2015
Yeah, here's something for you fan-boys to show your, um, solidarity:
http://www.redbubble.com/shop/varoufakis+t-shirts
And then there's this ...
> Just three-and-a-half hours after controversial Greek finance
minister Yanis Varoufakis resigned, his London-based book agents sent
around a public-relations email offering excerpts from his updated book,
the Global Minotaur, and other pieces of information.
The communications director at Zed Books, the publisher of Mr.
Varoufakis’s book, sent your correspondent an email describing Mr.
Varoufakis as the “possibly the coolest, charismatic and most
intelligent Finance minister ever” and even suggested a
hashtag:#MinisterofAwsome.
Greeks on social media responded angrily to what they saw as aggressive
promotion of Mr. Varoufakis, one of the architects of the country’s
current negotiating conundrum with its creditors.
“Is this a joke?” said one.
“OMG,” said another. <
http://blogs.wsj.com/moneybeat/2015/07/06/hours-after-exit-varoufakis-emerges-as-ministerofawesome/
There's no business like show business ...
On 06.07.2015 16:10, Keith Davis wrote:
> Great quote...
>
>
> Www.innergroovemusic.com <http://Www.innergroovemusic.com>
>
> On Jul 6, 2015, at 10:03 AM, David Morris <fqmorris at gmail.com
> <mailto:fqmorris at gmail.com>> wrote:
>
>> http://www.washingtonmonthly.com/political-animal-a/2015_07/and_i_shall_wear_the_creditors056421.php
>>
>> "And I shall wear the creditors’ loathing with pride."
>>
>> On Mon, Jul 6, 2015 at 8:33 AM, John Bailey <sundayjb at gmail.com
>> <mailto:sundayjb at gmail.com>> wrote:
>>
>> An amazingly fun analysis of the language of economists, by an
>> economist, if anyone cares to read (it's very long and slightly
>> Australia-centric):
>>
>> http://www.themonthly.com.au/issue/2015/july/1435672800/richard-denniss/clowns-and-treasurers
>>
>> On Mon, Jul 6, 2015 at 11:16 PM, David Morris <fqmorris at gmail.com
>> <mailto:fqmorris at gmail.com>> wrote:
>> >
>> https://medium.com/@gavinschalliol/thomas-piketty-germany-has-never-repaid-7b5e7add6fff
>> >
>> > Thomas Piketty: “Germany has never repaid.”
>> >
>> > On Sat, Jul 4, 2015 at 2:36 PM, David Morris
>> <fqmorris at gmail.com <mailto:fqmorris at gmail.com>> wrote:
>> >>
>> >> I think the difference between the US and the Euro is
>> obvious: one is a
>> >> country, the other is a currency. Currency, like Corporations,
>> aren't
>> >> people. A Country is made of people.
>> >>
>> >> The EU was never a sincere Union. It was a bankers deal, pure
>> and simple.
>> >>
>> >> David Morris
>> >>
>> >>
>> >> On Saturday, July 4, 2015, David Morris <fqmorris at gmail.com
>> <mailto:fqmorris at gmail.com>> wrote:
>> >>>
>> >>> Blame is the name of this game. Greasy Greece needs Reform
>> School Marm
>> >>> Urkle. Meanwhile a nation is indentured, and the banks aren't
>> >>> inconvenienced.
>> >>>
>> >>> Bravo Euro!
>> >>>
>> >>> David Morris
>> >>>
>> >>> On Saturday, July 4, 2015, Kai Frederik Lorentzen
>> <lorentzen at hotmail.de <mailto:lorentzen at hotmail.de>>
>> >>> wrote:
>> >>>>
>> >>>>
>> >>>> When looking out a window, it is easy to be fooled by your own
>> >>>> reflection and see more of yourself than the outside world.
>> This seems to be
>> >>>> the case when US observers, influenced by their own
>> country's fiscal debate,
>> >>>> look at Greece.
>> >>>>
>> >>>> For example, Joseph Stiglitz regards austerity in Greece as
>> a matter of
>> >>>> ideological choice or bad economics, just like in the US.
>> According to this
>> >>>> view, those who favor austerity must be obsessed with the
>> theory, given the
>> >>>> availability of a kinder, gentler alternative. Why would you
>> ever vote for
>> >>>> austerity when parties like Greece's Syriza or Spain's
>> Podemos offer a
>> >>>> pain-free path?
>> >>>>
>> >>>> The question reflects a lamentable tendency to conflate two very
>> >>>> different situations. In the US, the issue was whether a
>> government that
>> >>>> could borrow at record-low interest rates, in the middle of
>> a recession,
>> >>>> should do so. By contrast, Greece piled up an enormous
>> fiscal and external
>> >>>> debt in boom times, until markets said “enough" in 2009.
>> >>>>
>> >>>> Greece was then given unprecedented amounts of highly
>> subsidized finance
>> >>>> to enable it to reduce gradually its excessive spending. But
>> now, after so
>> >>>> much European and global generosity, Stiglitz and other
>> economists argue
>> >>>> that some of Greece's debt must be forgiven to make room for
>> more spending.
>> >>>>
>> >>>> But the truth is that the recession in Greece has little to
>> do with an
>> >>>> excessive debt burden. Until 2014, the country did not pay,
>> in net terms, a
>> >>>> single euro in interest: it borrowed enough from official
>> sources at
>> >>>> subsidized rates to pay 100% of its interest bill and then
>> some. This
>> >>>> situation supposedly changed a bit in 2014, the first year
>> that the country
>> >>>> made a small contribution to its interest bill, having run a
>> primary surplus
>> >>>> of barely 0.8% of GDP (or 0.5% of its debt of 170% of GDP).
>> >>>>
>> >>>> Greece's experience highlights a truth about macroeconomic
>> policy that
>> >>>> is too often overlooked: The world is not dominated by
>> austerians; on the
>> >>>> contrary, most countries have trouble balancing their books.
>> >>>>
>> >>>> Recent advances in behavioral economics show that we all
>> have enormous
>> >>>> problems with self-control. And game theory explains why we
>> act even more
>> >>>> irresponsibly when making group decisions (owing to the
>> so-called common
>> >>>> pool problem). Fiscal deficits, like unwanted pregnancies,
>> are the
>> >>>> unintended consequence of actions taken by more than one
>> person who had
>> >>>> other objectives in mind. And lack of fiscal control is what
>> got Greece into
>> >>>> trouble in the first place (...)
>> >>>>
>> >>>> The problem is that Greece produces very little of what the
>> world wants
>> >>>> to consume. Its exports of goods comprise mainly fruits,
>> olive oil, raw
>> >>>> cotton, tobacco, and some refined petroleum products.
>> Germany, which many
>> >>>> argue should spend more, imports just 0,2 % of its goods
>> from Greece.
>> >>>> Tourism is a mature industry with plenty of regional
>> competitors. The
>> >>>> country produces no machines, electronics, or chemicals. Of
>> every $10 of
>> >>>> world trade in information technology, Greece accounts for
>> $0.01.
>> >>>>
>> >>>> Greece never had the productive structure to be as rich as
>> it was: its
>> >>>> income was inflated by massive amounts of borrowed money
>> that was not used
>> >>>> to upgrade its productive capacity. According to the Atlas
>> of Economic
>> >>>> Complexity, which I co-authored, in 2008 the gap between
>> Greece's income and
>> >>>> the knowledge content of its exports was the largest among a
>> sample of 128
>> >>>> countries (...)
>> >>>>
>> >>>>
>> >>>>
>> >>>>
>> http://www.project-syndicate.org/commentary/greece-export-problem-by-ricardo-hausmann-2015-03
>> >>>>
>> >>>>
>> >
>>
>>
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