Johnna Montgomerie — Greece: Political Stress in Debt and Social Justice

The stark reality is there is no future in debt-led austerity. Eventually the money will run out to service the debt stock. Perhaps Greece can make the interest payment to the ECB at the end of May, but it is very unlikely to make the IMF payment in June. It is hard to avoid the conclusion that both the Greek state and Greek households have ended up behaving in similar ways to meet their obligations: squeeze expenditure, sell assets and try to find some extra income. Live hand to mouth.

This is Greece now. You cannot pay with money you do not have and the call from within Syriza to effect a “rupture” with its lenders simply reflects this sentiment. To call this a radical left policy completely ignores the economic reality that austerity is not working anywhere in Europe: growth is always stalled, another financial crisis always looms and the spectre of a debt-deflationary cycle haunts the entire continent.

Greek Reporter
Greece: Political Stress in Debt and Social Justice

Johnna Montgomerie | Lecturer in Economics at Goldsmiths, University of London

ht Clonal