Greek Crisis: Piketty on opening up Pandora’s Box

Europe 1 interview with Thomas Piketty on Greek crisis

Piketty on Europe 1 interview -

– – > 30 June Europe 1 article and video interview  available here 

“Expelling Greece would open up Pandora’s Box”

“The sorcerer’s apprentices who imagine that we will bring stability to the euro area by expelling a member to discipline others are extremely dangerous,” said the economist Thomas Piketty.

The analogy of Pandora’s Box may be even more applicable than one might think. If we recall the one word that appeared on the bottom of the box once all of the spirits had floated out. The word was HOPE.

– – – > For a serviceable Google English language translation of the article click here:

“The sorcerer’s apprentices who imagine that we will bring stability to the euro area by expelling a member to discipline others are extremely dangerous,” said the economist Thomas Piketty.

Some extracts in rough translate form.

INTERVIEW – In all likelihood, Greece will end up defaulting on Tuesday at midnight and take the risk of leaving the euro zone. A scenario feared by the economist Thomas Piketty, “it is near a major disaster. Open this Pandora’s box of a country emerging from the euro zone, it would be a tragic mistake, history Nobody can know that it happen next, “warned economist and director of studies at EHESS. In his eyes, it is time to talk about debt restructuring, one solution to consider a crisis.

Exclude Greece from the euro area “would be a tragic mistake, historical” What seemed unimaginable and now very seriously considered. Lack of agreement with its creditors, Greece could go bankrupt and excluded from the euro zone. “We are very close to a major disaster,” warned Thomas Piketty on Europe 1. “Opening this Pandora’s box of a country emerging from the euro zone, it would be a tragic mistake, history. Nobody can know that it happen next, there is a strong possibility that at each election, in Portugal or elsewhere, we will ask which country will come out. All those who say that the output can be located clearly strengthened and strong risk of end up with worse political movements in power, “he continued.

And the economist to point the advocates of a hard line vis-à-vis Athens, led by Germany. “The sorcerer’s apprentices who imagine that we will bring stability to the euro area by expelling a member to discipline others are extremely dangerous. The European ideal is about to be seriously dented, and perhaps even destroyed by the decisions of sorcerer’s apprentices. So the urgency, it is mainly as Holland take responsibility and come and say that the restructuring of the debt, not after tomorrow, that is now ” said Thomas Piketty.

Restructure debt, the real priority. In fact, for Thomas Piketty, any Greek reform will be futile if the creditors do not agree to a new clearing its debt. “We lost six months in these negotiations where we still have not addressed the important issue of overall restructuring of Greek debt and also other European countries such as the heavily indebted Portugal, Italy . It’s really all debt in the euro area to be restructured, “he has insisted.

And Thomas Piketty added:. “That erases a part, as has always happened in history there, there is a historical case of amnesia and ignorance on the part of our leaders is absolutely appalling because Europe in the 50 years has built just about clearing the public debts of the past to invest in the future, in infrastructure, in growth. Germany had a considerable external debt was canceled by the Paris Conference and London from 1953 and 1954 precisely to invest in the future because we thought that the younger generations of Germans, French and even did not have to pay for the debts forever accumulated by previous governments. Yet God knows if previous governments had much more serious than those of nonsense Greek governments in 2009 “.

A debate rejected by the rest of Europe. “It’s been six months since the Europeans would make proposals. There, I hear Juncker , Merkel, Hollande who say ‘ah, but precisely it was about to talk about debt restructuring. It’s a shame he left on Friday because we were going to talk about it on Saturday. “It’s been six months since the Greek government requested,” said Thomas Piketty. “I just remember the situation, he detailed: Greece share in 2009 of a considerable level of deficit, they denied also by manipulating their accounts were then in 2010 a share. unprecedented austerity policy that ultimately killed a little sick. When you have a level of economic activity, GDP, which fell by 25% between 2009 and 2015, it’s good for anyone, including for creditors: it does not help to repay the debt. “

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For more on the Greek Crisis:

* FromThinking about Economy and Democracyhere.

* From Network Dispatches on the Greek Crisishere.

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About the editor:

Eric Britton
9, rue Gabillot, 69003 Lyon France

Bio: Trained as a development economist, Eric Britton is a public entrepreneur specializing in the field of sustainability and social justice. Professor of Sustainable Development, Economy and Democracy at the Institut Supérieur de Gestion (Paris), he is also MD of EcoPlan Association, an independent advisory network providing strategic counsel for government and business on policy and decision issues involving complex systems, social-technical change and sustainable development. Founding editor of World Streets, his latest work focuses on the subject of equity, economy and efficiency in city transport and public space, and helping governments to ask the right questions and in the process find practical solutions to urgent climate, mobility, life quality and job creation issues. More at: http://wp.me/PsKUY-2p7

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