Monday, January 26, 2015

Bill Mitchell — Smart Austerity – its just the same dumb austerity

“In its current form, EMU is not viable in the long run”. That quote comes from a Report – Repair and Prepare – Strengthening Europe’s Economies after the Crisis – jointly published by the – Jacques Delors Institut (located in Berlin) – and the Bertelsmann Stiftung – (located in Gütersloh, Germany). The Report purports to lay out a blueprint to prepare Europe for the “next potential threat to its very existence”. It proposes a “path towards renovation” to create an “ever closer union”. They claim that they have taken up this task because there is “extensive ‘crisis fatigue’ and ‘euro area debate fatigue’ in “in governmental circles and the media”. I would call it adherence to ideological Groupthink rather than fatigue. There has been a major failure yet none of those who created the failure have put their hands up to take responsibility. Once they dismissed the problem as being caused by “profligate and fat Greeks (insert vilified nationality as to your preference)”, various policy makers and media commentators resorted to the even more amorphous “structural problems” to explain the on-going crisis. The media has been full of captive writers who just reiterate press releases from neo-liberal politicians and/or mainstream economists. So is this new Report different? Is their plan viable?

Before you get too excited, you might also like to know that the former organisation was founderd by the French politician after he finished his time as European President.
Delors will be remembered as the French neo-liberal (despite his socialist affiliation) who oversaw the disastrous Delors Report that informed the Treaty of Maastricht. It is clearly pro-Eurozone.
The German outfit is an off-shoot of the Paris-based – Notre Europe – Jacques Delors Institute. It is run by one Henrik Enderlein who is pro-Eurozone. 
Meanwhile, the Bertelsmann Stiftung has a history of advocating neo-liberal changes to public education and labour market reform in Germany. 
So you might expect my answers to the initial questions are No and No.…
Regrouping for a counterattack after an electoral defeat in Greece.

Bill Mitchell — billy blog
Smart Austerity – its just the same dumb austerity
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the Charles Darwin University, Northern Territory, Australia

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