Sunday, August 04, 2013

Greece under Angela Merkel's austerity crunch

Stephan Faris recently reported for Bloomberg Businessweek on the real consequence of German Chancellor Angela "Frau Fritz" Merkel in Greece's Unemployed Young: A Great Depression Steals the Nation's Future By Stephan Faris 07/25/2013:

Jobs of any kind are scarce in today's Greece. Nearly six years of deep recession have swept away a quarter of the country's gross domestic product, the kind of devastation usually seen only in times of war. In a country of 11 million people, the economy lost more than a million jobs as businesses shut their doors or shed staff. Unemployment has reached 27 percent—higher than the U.S. jobless rate during the Great Depression—and is expected to rise to 28 percent next year. Among the young, the figure is twice as high. Meanwhile, cuts to Greece’s bloated public sector are dumping ever more people onto the job market. In July, 25,000 public workers, including teachers, janitors, ministry employees, and municipal police, found out they would face large-scale reshuffling and possible dismissal. An additional 15,000 public workers are slated to lose their jobs by the end of 2014.

Greece's jobs crisis is a window into a wider emergency that threatens the future of Europe. Across the continent, a prolonged slump has disproportionately affected the young, with nearly one in four under the age of 25 out of work, according to the European Commission. (In the U.S., youth unemployment is 16.2 percent.) That understates the severity of the situation in Italy and Portugal, where youth unemployment rates have soared above 35 percent; Spain’s is 53.2 percent, the second-highest after Greece, at 55.3 percent. European Union leaders have announced an initiative aimed at guaranteeing that all young people receive a job, apprenticeship, or more education within four months of joining the ranks of the unemployed. Governments have pledged €8 billion over two years to combat unemployment in Europe’s worst-hit countries, and the European Investment Bank is offering €18 billion in loans to encourage hiring by small and midsize businesses. [my emphasis]
The damage Merkel's austerity policies are doing to Cyprus, Greece, Ireland, Italy, Portugal and Spain is staggering.

And Merkel's Germany continues to insist on more and more economically fatal austerity policies, in defiance of basically all real-world experience of macroeconomics. Patrick Donahue reports, also from Bloomberg News (Schaeuble Urges Pressure on Greece to Remain Before Vote 07/29/2013) on German Finance Minister Wolfgang Schäuble's hardline position:

"The pressure remains, so this has nothing to do with the [September German] election schedule," Schaeuble told Deutschlandfunk radio in an interview yesterday. "They’re far from being over the mountain," he said.

As European leaders scramble to plug the hole in Greece’s budget, Germany's political factions are maneuvering into position ahead of a vote eight weeks away as Chancellor Angela Merkel seeks a third term in office. Her challenger, Social Democrat Peer Steinbrueck, yesterday declined to rule out a possible "grand" coalition with Merkel's bloc.
Sadly, Steinbrück and the SPD have actually faithfully backed Merkel's neoliberal austerity policies. The differences they have articulated in the election campaign are basically cosmetic only. And it's hard to believe they would actually insist even on better cosmetics.

Tags: , , , , , , ,

No comments: