Simon Wren-Lewis has been on a roll lately; his latest talks about how the mishandling of Greece inflicted vast damage on the European economy as a whole, and to some extent the US economy too.
Basically, troika officials refused to admit the obvious and allow an early Greek default; instead they made absurd claims for the effectiveness of austerity, and in so doing spread austerian economics far and wide.
So in a way we’ve had the worst of all possible worlds: the alleged prospect of becoming another Greece has been used by austerians to frighten politicians and the public into policies that deepen the slump, and the mishandling of Greece — by many of the same people spreading this fear — has made the prospect of becoming another Greece even more frightening.
The IMF, at least, seems to have learned something from the experience.But as Wren-Lewis says, there is no hint of rethinking or remorse at the ECB, which is at this point the player that really matters.
Το άρθρο του Νομπελίστα οικονομολόγου Paul Krugman δημοσιεύεται στο blog του στους NEW YORK TIMES