Friday, May 18, 2012
Will austerity kill the Euro?
That does depend on whether the Euro bankers will pull their heads out of their asses in time. On its present course, austerity may drive countries like Spain, Italy, Portugal and Ireland to a situation like that of Greece.
For years now, Greeks have been bombarded with warnings about the dire consequences of leaving the euro, and never more so than since the recent, indecisive election that left the country saddled with a caretaker government. But those pronouncements seem to be falling on increasingly deaf ears, and for one simple reason, as one woman explained as she stood in central Syntagma Square:Squeezed to hard, pushed too far the Greeks have no hope that austerity will work so they are willing to try the "worst case ". Like Conservatives in this country, the Euro bankers had too much faith in their agenda and paid too little attention to reality.
“We have nothing to lose,” she said. “We have no fear.”
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The biggest problem will be electricity. Greece is dependent upon imported natural gas to fuel its power plants. Russia wants payment in Euros or Dollars for that gas. But neither Euros nor dollars will be available to the Greek government once they go into total default and switch back to the drachma.
It's going to be a cold, dark winter in Greece next year. But then, the lady is right, it's already going to be a cold dark winter in Greece, so ...
- Badtux the Economics Penguin
It's going to be a cold, dark winter in Greece next year. But then, the lady is right, it's already going to be a cold dark winter in Greece, so ...
- Badtux the Economics Penguin
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