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Friday, August 16, 2013

Kenneth Thomas :Annals of Austerity FAIL, Eurozone Redux

Middle Class Political Economist: Annals of Austerity FAIL, Eurozone Redux: July 31 saw the latest release of European Union unemployment numbers, and Monday's gross domestic product figures brought no joy, espec...

my comment
With the twin deficits above 15% of GDP each in 2009, the borrowed time of the Greek economy had long been exhausted. The non-option of default led to the two bailouts (110+130 bln), and also a haircut and buy-back of debt that reduced it by some 120 bln.
Austerity was not meant to be of the Alesina-Ardagna variety: it was rather what Edward Hugh defined:
What happened .... was not a case of long established living standards being suddenly slashed, it was a case of them being cut back to where they were before they were raised in an unsustainable way in order to win elections.

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