Wednesday, January 28, 2015
Austerity on trial
January 28, 2015
Is this the beginning of the end for austerity?
The day after the Greek left-wing party Syriza impressively won the country’s latest election, the Financial Times ran the following headline:
“Greek leftists’ victory throws down challenge to euro establishment . . . Inspiration for similar parties across continent.”
It was Greece, recall, that in late 2009 triggered the European debt crisis with the revelation that its budget deficit was far worse than its official statistics indicated (the numbers had been fudged). And Greece has suffered mightily. From late 2009 to the end of 2013, its economy (gross domestic product) shrank by a punishing 25 percent. At last count (September), the unemployment rate was 25.7 percent. Among youth under 25, the rate was 49.8 percent.