…look where Greece has ended up after five years of crisis resolution. It has had one of the worst performances in economic history; yet we have just concluded an extension of the same policy.<\/p>\n
Can this be sustainable? The pragmatists in Europe\u2019s chancelleries say they can roll over loans indefinitely at very low interest rates. Economically, this is the equivalent of a debt writedown; yet politically it is easier to deliver because you do not need to recognise losses. The equivalent statement in a military conflict would be: if you renew a ceasefire often enough, you end up with peace.<\/p>\n
This type of argument is not only immoral and dishonest. It also does not work. While you play this game of ex\u00c2\u00adtend-and-pretend, the real economy implodes: austerity has caused a meltdown in income and employment. Monetary policy mistakes caused a fall in eurozone-wide inflation rates that made it impossible for Greece and other periphery countries to improve the competitiveness they lost in the early years of monetary union.<\/p>\n
If the EU deals with Ukraine in the same way it dealt with Greece, you can expect to see a parallel development in a few years.<\/p>\n