Wednesday, December 30, 2015

Bill Mitchell — Spain in limbo but has not rejected austerity

Summary of the fault lines built into the structure of the EZ. The only practical way to reject austerity is either to change the rules, or for countries to exit the zone and return to issuing their own currencies.
So when a political party claims to be anti-austerity but then supports the nation remaining within the monetary union with all the pernicious and unworkable rules that go with that, then we know the political leaders are lying and trying to pretend to be progressive rather than neo-liberal (lite or otherwise).
Bill Mitchell – billy blog
Spain in limbo but has not rejected austerity
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia


Ignacio said...

You would have to be suicidal to say you will quit the euro if you want to be elected. "Podemos" had to drop that line for the 'forever hopeful internationalist lefty EU'.

Sorry but no one is listening, just hoping Germany blows it all up due to stupidity one day.

NeilW said...

"You would have to be suicidal to say you will quit the euro if you want to be elected."

Or you have to be a Master Persuader prepared to point out the problem.

Matt Franko said...

They cant persuade anybody Neil because they dont understand it...

Even left people that are close like Varoufakis or even Galbraith dont understand it they come from a lawyerly background and are just scraping the edges of understanding... they could never make the case...

You look at the backgrounds of all the people and they have degrees in PoliSci or Law or History or some other non-technical field... no training in systems theory or even basic accounting science at all... they cant understand the cause-effect relationships they have no training nor are they intelligent enough to bring in people who do...

they live in an "equality!" bubble they want to think everyone is created equal so even they should be able to understand it too even without any training or qualifications or basic aptitude...

Ignacio said...

Well Matt, initially the party was more radical but in order to be electable it had to drop some things and amongst them was the whole exiting the euro thing (they also had some income guarantee in the program that had to drop too).

Once you start suggesting something the media will slaughter you, you have to become along the mainstream lines and certain things are sacred. It's funny because for a supposedly radical party the assault on them has reduced as soon as they are started to drop 'strange' things.

You have to be a weirdo to suggest that the euro is a disaster and that countries should establish their own currency again. The groupthink is superstrong with this one, and is not only about the 'maths', is some idealistic political non-sense, the dynamic in southern Europe is different due to recent past, this is something that you don't see in the media but you can feel it. However I could see France or other northern countries dropping it eventuall, even Germany itself could blow up the whole thing (my hope really). No amount of persuasion is going to change all this, is like speaking to a wall, those who listen are in the minority.

That said what I can see happening eventually from the left is a re-introduction of national currencies and having dual currency systems. If things get worse I think this will be what happens, and this is in fact being planned in places like Barcelona which had their own currency planned and the mayor was voted with that in the agenda (and the party gained even more votes in the general elections). It looks like this is also not so heavily opposed from Frankfurt and Brussels, so it's a compromise.

The obsession with exporting and competitiveness still there though.

NeilW said...

"Once you start suggesting something the media will slaughter you"

The media aren't doing a good job at slaughtering Trump. Which suggests that you allow the media to slaughter you by pandering to them.

Instead you need to do what Trump does - ignore what they say about you and just be grateful they are talking about you and not the opposition. The same approach worked for Corbyn - but with a different style.

If the media provides your self-validation that is difficult to do. If you get your validation elsewhere - as Trump and Corbyn do - then you can ride them, and eventually they have to come to you because you *are* the news.