A serious write-off of Greek debt holds out the prospect of turning the tide back on Europe’s own version of neoliberalism, right the way across the continent.(…)
As a result of these concerns, the QE that has been implemented is flawed, and itself contains the potential for the eurozone’s future break-up.(…)
But Europe’s Old Guard don’t want to budge on Greece, lest it any weakness now opens the floodgates in the future. The crisis is no longer strictly economic. It is now vey much political.(…)
Martin Wolf in the Financial Times, and The Economist have both come out broadly in favour of this approach, and Bank of England Governor Mark Carney’s intervention point in the same direction. Reports in the Greek press, meanwhile, suggest that Barack Obama phoned Tsipras earlier this week to inform the Greek PM that he, too, opposed excessive austerity.This programme, in other words, would see a reduction in Greece’s debt burden, but no immediate change to the demands for austerity and “structural reform”.(…)
Far better, then, to treat the need for “structural reform” as an opportunity to shift the Greek economy out of the hands of the bankers and oligarchs, and for the benefit of ordinary Greeks. That would mean, exactly as Syriza argue, both increases in the minimum wage, job creation, and restoring pensions, alongside tackling chronic evasion and graft by, in particular, Greece’s elite. Varoufakis has vowed to “destroy” the oligarchs, the ultra-rich families who dominate Greece’s economy, and, if he and Syriza are successful in bringing some order to the tax system, there can be a huge transfer of wealth and resources towards the rest of Greek society.