Jeffrey Sachs on Germany and the Greek crisis

Jeffrey Sachs was an adviser to the Greek government and Finance Minister Yanis Varoufakis during the Greek negotiations with Germany/The Troika this year, along with Jamie Galbraith.

While Sachs expresses himself more sympathetically toward neoliberal "structural reforms" than Galbraith or Varoufakis, he's highly critical of German Chancelor Angela Merkel's austerity economics in Greece. In Germany, Greece, and the Future of Europe Huffington Post 07/28/2015, he writes:

Creditors are sometimes wise and sometimes incredibly stupid. America, Britain, and France were incredibly stupid in the 1920s to impose excessive reparations payments on Germany after World War I. In the 1940s and 1950s, the United States was a wise creditor, giving Germany new funds under the Marshall Plan, followed by debt relief in 1953.

In the 1980s, the U.S. was a bad creditor when it demanded excessive debt payments from Latin America and Africa; in the 1990s and later, it smartened up, putting debt relief on the table. In 1989, the U.S. was smart to give Poland debt relief (and Germany went along, albeit grudgingly). In 1992, its stupid insistence on strict Russian debt servicing of Soviet-era debts sowed the seeds for today's bitter relations. [my emphasis]

Here is part of his criticism of Merkel's policies:

In my view, the policy response by Greece's partners, led by Germany, has been unwise and highly unprofessional. Their approach has been to extend new loans so that Greece can service its existing debts, without restoring Greece's banking system or promoting its export competitiveness. Greece's initial €110 billion bailout package, in 2010, went to pay government debts to German and French banks. As a result, Greece owes an ever-larger share of its debt to official creditors: the International Monetary Fund, the European Financial Stability Fund, and, increasingly, the European Central Bank. While Greece's debts to private creditors have been partly cut, this was too little too late, because it cannot even service its debts to official creditors.

Year after year, Greece's creditors have promised that the bailout packages would bring about a meaningful rebound in output, employment, and exports. Instead, the country has experienced a depression comparable to the decline in output and employment that Germany suffered from 1930 to 1932, the years that preceded Hitler's rise. Many Germans may despise Greece's current Syriza government, which pledged to end the policy of creditor-imposed austerity; but four consecutive governments -- center-left, technocratic, center-right, and left -- have implemented it.

All of these governments have failed. Perhaps Antonis Samaras's center-right government from 2012 to 2015 came closest to succeeding, but it could not survive, politically, the severe austerity that it was being forced to impose. Nor did Greece's creditors do anything to help Samaras's government out of its political bind, even though it was a government they liked. [my emphasis]