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26 Οκτ 2015

Steve Keen : It's all Greek to me: The politics of Syriza and the Troika

By Professor Steve Keen,

Ο διαπρεπής Αυστραλός καθηγητής οικονομικών Steeve Keen, ιδιάιτερα γνωστός για τις αναλύσεις όσον αφορά τη φούσκα του χρηματιστηριαού κεφαλαίου και των των αγορών, αναφέρεται δηκτικά  στην ελληνική πραγματικότητα,με άρθρο του στο περιοδικό Forbes, επισημάινοντας τον παραλογισμό της πολιτικής του ΣΥΡΙΖΑ αλλά και της τρόϊκα. Ολόκληρο το άρθρο έχει ως εξής.

I have to admit that I was flummoxed by the political developments in Greece this week. After winning a referendum based on rejecting the Troika’s terms, Tsipras capitulated to those same terms—if anything, to somewhat harsher terms—less than a week later.

I have given up believing that Syriza was executing a straightforward political strategy—negotiate to get less extreme conditions plus some debt relief—and can now see only 4 other interpretations:

One of two Byzantine political strategies;
Absolutely no strategy and chaos that appears Byzantine; or
They were broken by the EU and have capitulated.
 The Troika’s strategy, on the other hand, is pretty straightforward to interpret: an intention to either break Syriza or (preferably) force them out to office, to be replaced by a more compliant party; and an imposition of austerity for both moral reasons, and because, as Ordo-Liberals, they actually think that hard work and reform are all that are needed.

 Interpreting what’s going on with Syriza is only of peripheral interest: unless they do something absolutely stunning, like default on all their debts and introduce the Drachma overnight, what happens in Greece will be determined by the Troika. So I’m going to address those who support the Troika’s approach first with a plea based on a medical analogy.

 Schaeuble’s diagnosis is that market correction of a mis-pricing of Greek risk was the cause of the crisis, and to end it Greece must regain the trust of the international community by undertaking serious reforms. Spreads will fall, and growth will occur, once these reforms are in place.

 Let’s assume that is correct. What is then being undertaken on Greece is like an emergency medical procedure, from which the patient is expected to emerge cured and stronger.

 This medical operation analogy can be carried further: when you are undertaking surgery on a patient, what do you do to their vital physical systems?

 You anaesthetise their brains and nervous systems so that they don’t feel the pain, and you give them an ongoing blood transfusions to make up for the blood lost during the operation.

 Is this how the Troika’s program is being administered? It would be, if the huge changes to legal and taxation and subsidy and workplace and privatisation rules were accompanied by allowing a substantial government deficit. The cash flow from the deficit would soften the blow on Greek businesses and societies as they made the painful transition from rules befitting a patronage state across to those of an efficient, modern society.