Syriza Isn’t Extremist — the Austerians Are

Mark WeisbrotWho are the extremists here? Is it the European authorities, which some identify with the Germans but it’s more than them? Or is it Syriza? Back in May of 2010 when they signed their first agreement with the IMF, the debt was 115% of GDP. Then the IMF and the European Commission said, “Okay, you do what we want and you’ll recover and your debt will be sustainable.” So now that that debt is over 170% of GDP — they’ve had six years of recession; they’ve lost a quarter of their GDP; 26% of their labor force is unemployed (double that for youth) — it’s clear who’s been wrong here.

Now if you want to say that they should do more, they’ve already paid a huge unnecessary price. Clearly, there was some adjustment that had to take place. The purpose of any kinds of loans or aid should be to make that adjustment easier, not to make it ten or fifty times worse than it has to be. That’s what they’ve done. So now they’ve adjusted. They’ve had one of the biggest adjustments in imports in the world — 36%. And they have now a primary budget surplus and they have a current account surplus. And the question is, when do they get the recovery after six years of this? And that’s what this fight is about. And Syriza is saying, “Look: we’ve paid too much of a price, we’ve enacted a lot of policies that were really regressive — like a big cut in minimum wage, 40% cut in healthcare spending, change in labor law that weakens the bargaining power of labor, laying off 20% of the national government workers — and we’re going to reverse some of these because we want the economy to grow. We don’t want 16% unemployment in 2018, which is what the IMF is projecting if everything goes well according to their program.”

So I think if you’re looking at it from a more neutral point of view, it’s clear that Syriza is the voice of reason as compared to the extremists that have destroyed not only the Greek economy, but have brought 11.5% unemployment in the Eurozone — which is more than twice what we have in the United States.

—Mark Weisbrot
Interviewed on CounterSpin

4 thoughts on “Syriza Isn’t Extremist — the Austerians Are

  1. You are so right. In the 90s the IMF failed in Southeast Asia and later in Latin America – most famously thrown out of Argentina. Why does it have any credibility at all? What a scam!

    • I think the reason is very clear. The IMF and other such institutions are not meant to help these countries. They are meant to maintain international corporate power. You are right: it is a scam. Just as one would be crazy to trust establishment medicine of the 17th century, one is crazy to trust establishment economics of the 21st century. They both involved bleeding the patient to death.

      • Yep. Greece, Portugal, et.al. suffer from having joined the Eurozone. If they hadn’t, their debt would be sustainable. Honest economists know this.

        The IMF, as you say, only cares about protecting its investors as it siphons off money from those countries entrapped in their system.

        • What really bugs me is that the power elite push narratives that enrich them. But then the working class accepts those narratives as moral claims. Hence: the upright Germans and the lazy Greeks. That’s shameful. But it seems that the power elite are not capable of feeling shame.

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