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«to be dealt with by European technocrats accountable to no one» That's a particularly delirious hallucination, as all the decisions regarding the greek situation were taken solely by democratically elected heads of government in meetings in which the greek head of government fully participated. To the point that they complained that they had to do all nighters because Tsipras was arguing every detail point. The EU and Eurozone rules are both very clear indeed, which makes this delirious hallucination even more absurd: no taxing or spending decision can be made by «European technocrats accountable to no one», but solely by heads of government democratically accountable to their voters. Even finance ministers are excluded from decisions (and usually even from attending, never mind speaking, at meetings) on taxing and spending matters. The delirious hallucination above is even more incomprehensible as in the matter of the greek bailout the polls indicated that a large majority of the 200-300 million eurozone voters wanted a much harsher offer to Greece than the one agreed democratically by the heads of government. Also, such decisions are made as rule to unanimity: the offer to Greece was made by *all* the democratically elected heads of government of the eurozone, nobody abstained, and since it required unanimity, it was enacted because the democratically elected head of the greek government accepted it and did not veto it as it was their absolute right. That agreed offer was then democratically voted upon and confirmed by several democratic parliamentary votes in Greece and other major countries. None of them liked it very much, but it was democratically approved by democratically elected heads of governments and their democratically elected parliamentary majorities in democratic and public votes.
«a substantial deterioration in the private sector balance. What has happened, in other words, is that the private sector has been encouraged, through easier access to credit, to go on a borrowing binge. Financial indiscipline and reckless have not disappeared; they have moved from the public to the private sector.» You are describing here the preferred economic policy practiced in many anglo-american culture economies since the 1980s. In the UK this was notably described by Colin Church and named by him suggestively "privatized keynesianism". «In the 1980s and 1990s, there was a stream of thought – known as the Lawson doctrine -- that said we should not worry about external deficits that are the consequence of private sector saving and investment decisions. No serious economist believes this anymore in view of the systemic consequences of private sector folly.» There are then plenty of non-serious but extremely well compensated Economists still maintain that doctrine. It has even evolved into the Greenspan Doctrine that the best economic policy is to boost the balance sheets of property owners, so the capital gains may trickle down. «Private sector debt crises have a way of engulfing the entire economy, and largely as a consequence, unmanageable private debts tend to find their way onto the public balance sheet.» A lot of people like the idea that they can make a lot of money by booming debt and then the public pays the bills. Among those many people the middle aged property owning middle classes in particular love that.
Toggle Commented Apr 18, 2015 on Turkish economic myths at Dani Rodrik's weblog
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Apr 18, 2015