The debacles roll on

I'm reluctant to comment on Greece's latest demetamorphosis since Greek politics isn't my speciality. But that's OK, since it doesn't seem to be much of a speciality for Greeks, either. As Krugman wraps today's events: "The debacle rolls on."

Debacle-manufacturing isn't unique to Greece, though. Earlier I was listening to Harvard's Kenneth Rogoff--hardly a Share Our Wealth, Huey Long economist--urging the central banks of both Europe and the United States to "flood the markets with liquidity," and here at home for the U.S. government to begin rebuilding our decayed and decaying infrastructure: roads, bridges, water systems, ports, all the material components of a modern civilization without which we cannot sustain ourselves, let alone grow economically.

And yet what are we doing? What is roughly half of Washington advocating? The Greek solution.

The debacles roll on. 

Comments

[Peter G]

Much as I delight in your commentary and wisdom I think I detect a disdain for that associated science, economics. I get the impression that you believe that Greece has a choice between austerity and not austerity and that is simply not true. The Greeks made their choice to minimize austerity. And it will still be horrible. You simply cannot live so far beyond your means and expect your neighbors to forever pick up the tab. The Greeks did everything wrong. They had abysmal labor productivity and a laughably inefficient tax collection system that practically everyone could and did avoid. And they had the poor impulse control that is the feature of just about every democracy. They borrowed and spent far, far more than they could ever hope to repay, leaving themselves zero room for a Keynesian solution to their economic crisis. I'm sure they felt they deserved the excellent social benefits and generous pensions and other perks that come with a modern well run industrialized society. Except they were never that. Austerity in such a case is not something you choose, it is something you get. Now they'll get less of it because, to some degree, external funding through the IMF and their European partners is available. It would not otherwise be.

[Jason]

Peter G, good points, but PM's larger point still stands, which is that the U.S. is not Greece and that we have many more, less painful options for dealing with our economic woes, but yet, we're still flirting with the Greek approach because of the greed of the corporate class, the rank stupidity, corruption, and mean-spiritedness of the Republicans, and the cowardice of the Democrats.

[Peter G]

I absolutely agree with you Jason. Greece is an object lesson in what happens when you completely and utterly mismanage your own economy and the only thing you try to export is the tab. The US has enormous vitality, high labor productivity and the world is practically begging you to accept their money in the form of Treasury bonds. Austerity is daylight madness when applied to the US economy. I think most thinkers on the right know this but that will not prevent them from using this fear driven opportunity to advance their ideology of small government and minimal taxes. The irony is that the US is so wealthy and so productive that austerity is an option. You can afford to injure yourselves without risking economic death for all. What saddens me is that so many are willing to injure their fellow citizens in such a cause. Regretfully it happens in my country too and just about every other.

[Robert Lipscomb]

I love Greece, especially the ancient Greeks. One must always remember a few things about them.

The Greeks invented and named democracy.

The Greeks delegitimized democracy for the better part of two millenia. Even our founding fathers were contemptuous of democracy.