Monday, July 13, 2015

What A Mess

Monday, July 13, 2015

I found myself thinking of Europe today. My mother's birthday is next week. I bought a birthday card for her while I was in downtown Minneapolis today. I also was thinking of Europe due to the events taking place in Greece in particular and in Europe in general.

It's not exactly an encouraging time to be a member state of the European Union. European unity appears to be seriously damaged despite efforts to keep Greece within the eurozone. I have been reading a number of articles from the New York Times throughout the last several weeks. As the crisis has dragged on the details of its parameters as well as the different policy solutions proposed have continued to confuse me. It seems taking a long view is difficult for many bureaucrats.

An editorial in today's New York Times summarized the recent deal crafted after lengthy efforts between the numerous concerned parties. It seems the 'treatment' for what ails Europe could quite likely be worse than the affliction itself. Many people commenting on recent articles have referenced the phrase 'kicking the can down the road'. I do indeed think an appropriate (sustainable) solution is being avoided in favor of something that will buy some time in the short-term but not ultimately address the systemic issues at play.

A policy of rigorous austerity seems unlikely to reverse the contraction of the Greek economy. And without economic expansion it seems unlikely Greece will find itself able to create the wealth necessary to ultimately climb out of its enormous debt any time within the next several years. Greece could indeed be facing something like the lost decade Japan experienced in the 1990s. But Greece seems likely to experience something much worse. Perhaps they will experience an entire lost generation.

I wrote the following in response to the NYT article that detailed the last minute efforts which culminated some twenty-four hours ago:

It saddens me to read this article. I have been following the Eurozone/Greece debacle for some time now. I don't care how the media spins it there will be no real winners in this charade. Why? Because human pettiness is on full display in the actions of all concerned.

Should Greece have been admitted to the euro currency union? Apparently not. Have the Greeks or Europe learned that austerity is *not* the way to run an economy that is recovering from a massive downturn? Apparently not. (I am not an economist but anyone who has taken a basic economics course as I have should know that running deficits is more appropriate when you're in a recession or depression - otherwise you risk never stimulating your economy sufficiently to decisively leave such dark times behind) Is Germany being overly punitive? I think so. Are the Greeks responsible for this mess? Yes. Are the Germans? Yes. Are the bankers? Yes.

My disgust is all the more heightened by the fact of my own circumstances. Having completed graduate school four years ago I have struggled to find a job commensurate with my skills. I have looked in numerous markets here in the USA as well as abroad. Like Greece I am indebted. But unlike them I have not practiced tax evasion and the like. And yet I still feel screwed over.

Something is drastically wrong with our world. The worst qualities of capitalism are on full display in many places. Profits ahead of people lead to a world degraded in more ways than I can easily count.

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