Guest post by MARC SAXER
Ten reasons Why Austerity is Dangerous Fallacy
Another European summit without any resolution has passed. Even if a last minute settlement for this round can be reached, it would most likely continue the austerity policies of the last years. In any event, the next showdown would be just around the corner. Instead of tackling the risks of a global financial crisis, the collapse of the European integration project or the undermining of democracy, Europeans are fraying over olive tree subsidies and pensions. The debate over Greece is out of touch with the real challenges, and leads to flawed policy responses.
It is infuriating to watch Europe tumble down the path of austerity. Frugality! Discipline! Rules! The guardians of virtue seem to have turned a deaf ear to all expert advice. One Nobel Prize Laureate after the other cautions that too much fiscal bloodletting might just kill the patient. Amartya Sen. Paul Krugman. Joseph Stiglitz, Jeffrey Sachs. In Europe, Jürgen Habermas, Ulrich Beck and Thomas Piketty chimed in. Even the chief economist of the International Monetary Fund, Olivier Blanchard had to admit that the tax hikes and spending cuts have created more havoc than the architects of austerity have ever deemed possible.
Austerity is tomfoolery. Here are ten reasons why. Continue reading Greece – The Story of Wrong lessons Learnt: Marc Saxer