Only in the topsy-turvy world of Neo-Liberal economics can the further decline in Greek Gross Domestic Output (GDP) be called a triumph. And yet, that is what economically conservative newspapers like the Daily Telegraph are saying about the latest batch of figures that show that Greece is in recession for the twentieth consecutive quarter.
According to the Daily Telegraph “Excluding the borrowing costs on its massive debt burden, the Greek government is now raising more money than it spends.” What the Telegraph isn’t reporting is that this has been achieved by massive lay-offs of civil servants, a relaxation of the minimum wage and a punitive property tax that will only be exempt for those living below 6000 euros a year.
Obviously, the most simple economics lesson from history has not been heeded. When in a slump, the only way out is to stimulate demand in the economy. As Simon Jenkins in The Guardian has rightly pointed out for some years now, the best way to do this is to give the money directly to people to spend, rather than to bankers in the form of Quantitate Easing and the purchase of bonds. How much QE money has been salted away in tax havens and used to keep share prices high?
Instead of the stimulus money going into the Greek economy to ensure that it can grow it’s way out of debt, the austerity nutters are continuing to bleed the Greek economy dry while expecting a miracle. No wonder the politics of fear and uncertainty are taking hold in Greece.
The Greek unemployment rate is now at a staggering twenty-seven per cent, with no sign that it is coming down. All those people out of work, dependent on squeezed state benefits and charity hand-outs. Before long we have to start asking what will be left of the Greek economy, because at this rate there is going to be very little to work with afterwards to restore growth.
As Zygmunt Bauman points out “The fraudulence of the promised ‘trickle-down’ effect of opulence at the top has now been laid bare – for everybody to watch helplessly and bewail – but the ‘collateral casualties’ of the grand deception are here to stay for a long time to come. The foundations of social solidarity and communal responsibility have been sapped, the idea of social justice compromised, the shame and social condemnation attached to greed, rapacity and ostentatious consumption have been wiped away and they have been recycled into objects of public admiration and celebrity cult”.
It is not the ordinary people of Greece who brought this about, but the international financiers in London and around the world who have inflicted this burden on the Greek people. I can only utter my indignation – twenty quarters of recession! Surely someone might have got the idea by now that this isn’t working? Imagine how much it is going to cost to repair the damage and sort out the cost to Greek society once this wicked experiment is over?