The Case for Grexit by Costas Lapavitsas

Thank you for posting this, I am reblogging it so I can post a response. I have known Costa since 2007 when I was working at SOAS. He is consistent and a serious researcher. He is also wrong.

Thoughts on European Politics & Economics

Hold on! Hold on! Before all you faithful Greece watchers shoot me down in flames. Let’s just take things one step at a a time.

Firstly, Costas Lapavitsas is an academic, a very well educated man and his specialty is Economics. I am not usually impressed by academic titles but I do wish to mention, in passing, that Costas has a Doctorate degree from Birkbeck College, University of London. So, although he may be wrong or misguided in his analysis, he certainly is not stupid. Recently, Costas entered politics and is a Syriza member of parliament in Greece. Does this sound familiar? Has anyone been following the exploits of Yanis Varoufakis?

However, lets not get distracted off the subject of this post.

Recently, Costas wrote an article titled, “The Case for Grexit” and it was published in the July 2015 edition of Le Monde Diplomatique.

The premise of…

View original post 1,817 more words

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5 thoughts on “The Case for Grexit by Costas Lapavitsas

  1. Just one comment on the article by Costas Lapavitsas.

    He writes: “The response of the creditors in June was ruthless (…). There was no mention of debt relief or of any sizeable investment programme.”

    No sizeable investment programme??? I see the same claims repeated over and over again by several authors, allegedly Europe does nothing for investment. Sorry, this is simply NOT TRUE.

    See for instance: “Supporting Greece to exit the crisis: European Commission adopts 18 new investment programmes for jobs and growth and better quality of life in 2014-2020”.
    18 new EU investment Programmes for Greece and each of its regions have been given the green light today by the European Commission. These strategic investment programmes for 2014-2020 represent a major support in helping the country out of the crisis and will help creating jobs as well as new opportunities for growth and economic development. Together the value of the programmes amounts to more than €17 billion from the European Regional Development Fund (ERDF), the European Social Fund (ESF) and the Cohesion Fund (CF).

    https://ec.europa.eu/commission/2014-2019/cretu/announcements/supporting-greece-exit-crisis-european-commission-adopts-18-new-investment-programmes-jobs-and_en

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    • @erikdesonville

      I have looked at what you are referring to regarding investment assistance by the EU. In fact there is quite a lot of information available and it can become a little confusing.

      But you are not wrong about the following statement, in general:

      “No sizeable investment programme??? I see the same claims repeated over and over again by several authors, allegedly Europe does nothing for investment. Sorry, this is simply NOT TRUE.”

      You correct. Let’s take Spain for example. I have traveled around most of Spain recently, not extensively, but enough to get a good general grasp of things. It is very obvious to me, as it should be to any observer, that many infrastructural projects are funded by the EU (there are large billboards erected that state the details). And these are wonderful and benefit the country and its citizens. And there are other funds too, actually spent or budgeted for, available for many other, maybe less obvious projects (http://ec.europa.eu/budget/mycountry/ES/index_en.cfm). It is the same for all the other EU countries, including Greece (http://ec.europa.eu/budget/mycountry/EL/index_en.cfm#cinfo). These statistics, facts & figures make for interesting reading.

      Regarding Greece. Is this EU money being spent properly? Does most of it actually find its way to where it is needed? Is this money making a real difference to improving the economy? Can the ordinary person in the street notice any improvements? If I interpret his comments correctly, Costas thinks that the answers to all of these questions are in the negative. And, based on my information, I am in agreement with him. I last visited Greece many years ago, before the introduction of the Euro. Now I only have what I read on the internet & see on video clips to be able to judge what the actual conditions are like. And nothing has been able to convince me that any of this wonderful EU money is making any difference. But there is no more space here to go down this path at the moment.

      Lastly, when it comes to politics, my warning systems are always on high alert. As highly improbable as it may be and to rather believe that coincidences do happen, I am suspicious about the timing of this EU Press release dated 22 December 2014: Supporting Greece to exit the crisis: European Commission adopts 18 new investment programmes for jobs and growth and better quality of life in 2014-2020. Together the value of the programmes amounts to more than €17 billion.”

      After the first ballot was held to elect the new Greek president on 17 December 2014, the writing was on the wall that ND and PASOK were going to get a hiding. Things were not any better after the second ballot on 23 December and by the time of the third ballot everyone knew that snap elections were on their way. Desperate times call for desperate measures. The EU had to do something to persuade the Greeks that staying in the EU/Euro club was better than leaving it!

      How about a promise of a €17 billion investment aid package. That should do the trick!

      I rest my case.

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      • smithpeter999> I rest my case.

        Case well taken 😉

        There’s an eternal problem with all funding from “Europe”.

        If the support is missing, everybody complains there isn’t. If the support is given, (almost) everybody shouts it’s badly spent (to be read as: given to the wrong ones i.e. to political adversaries). In conclusion “you’re damned if you do and damned if you don’t”.

        That’s the reason why it’s so important that the programmes are “owned” by the respective countries (i.e. member states, not gov’ts, see below). At the same time it’s important not to give the impression of interfering with sovereignty and domestic politics. A very thin line indeed.

        smithpeter999> Regarding Greece. Is this EU money being spent properly? Does most of it actually find its way to where it is needed? Is this money making a real difference to improving the economy? Can the ordinary person in the street notice any improvements? If I interpret his comments correctly, Costas thinks that the answers to all of these questions are in the negative. And, based on my information, I am in agreement with him.

        I think that I understand the Left Platform position about “odious debt” pretty well.

        However, I take for granted that the Greek authorities, duly elected by sovereign democratic process, have had a significant input in the selection and implementation of projects, and that none of the “European” money has been spent against their will.

        From the union perspective, it’s impossible to form a union when a new gov’t Y in country Z can decide to reject agreements made by previous gov’t X and gets away with it. Ultimately “Europe” (EU/EZ) deals with “member states” (not with gov’ts), and then the “member states” are supposed to honour their commitments made as “member state”. In other words, the gov’ts are assumed to act as responsible representatives that make binding commitments for the resp. member states. (I take for granted this principle is somehow worded in legalese in the treaties, but I’m not a lawyer).

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  2. @iGlivanos,

    You are always welcome to reblog anything you find on my blog. As you have always done in the past, I look forward to you adding further quality content to the debate on these issues that interest us, and that are critical to the future prosperity of Greece.

    Like

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