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Greek debt package like a time bomb
By Shawn A. Mesaros |
March 7, 2012, Wednesday
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"IF I were running a peripheral country I would say that you cannot leave" the 17-nation currency region, Paul Krugman, a professor at Princeton University, said in Lisbon on February 26.
Any American who has read the Declaration of Independence should assist Greek citizens to take the bold step of going it alone.
Germany's parliament approved a second Greek aid package in Berlin recently. Still, finance officials from the Group of 20 nations meeting in Mexico last month refused additional funding through the International Monetary Fund until the region first ratchets up its resources.
Asked about Chinese aid for Europe, Krugman said that it's not needed as the resources to solve the debt turmoil are "all here in Europe."
Krugman forgot that there's just no political "will" to save Greece beyond voting for an exchange offer that everyone fully expects to fail. US Treasury Secretary Timothy F. Geithner said in February in Mexico that the region needs to make its crisis-fighting commitments "credible."
We would disagree. If "credible" means foisting yet more trillions of dollars of debt on one's citizens perhaps "credibility" under such terms is undesirable.
What's clear is that there's no credible way to simply pile on more debt and call it "fixed" when governments pile on debt and (only) the taxpayers are left on the hook to pay for the dreams of the last salesman-in-charge.
The "package" from outside Greece might as well be an atomic bomb given the devastating effects on the sovereignty of the Greek citizens.
So begins the US Declaration of Independence: "When in the course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."
Give Greece freedom in choosing its economic path.
The author is managing director of Pamria, LLC. The views are his own. Shanghai Daily condensed the article.
Any American who has read the Declaration of Independence should assist Greek citizens to take the bold step of going it alone.
Germany's parliament approved a second Greek aid package in Berlin recently. Still, finance officials from the Group of 20 nations meeting in Mexico last month refused additional funding through the International Monetary Fund until the region first ratchets up its resources.
Asked about Chinese aid for Europe, Krugman said that it's not needed as the resources to solve the debt turmoil are "all here in Europe."
Krugman forgot that there's just no political "will" to save Greece beyond voting for an exchange offer that everyone fully expects to fail. US Treasury Secretary Timothy F. Geithner said in February in Mexico that the region needs to make its crisis-fighting commitments "credible."
We would disagree. If "credible" means foisting yet more trillions of dollars of debt on one's citizens perhaps "credibility" under such terms is undesirable.
What's clear is that there's no credible way to simply pile on more debt and call it "fixed" when governments pile on debt and (only) the taxpayers are left on the hook to pay for the dreams of the last salesman-in-charge.
The "package" from outside Greece might as well be an atomic bomb given the devastating effects on the sovereignty of the Greek citizens.
So begins the US Declaration of Independence: "When in the course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."
Give Greece freedom in choosing its economic path.
The author is managing director of Pamria, LLC. The views are his own. Shanghai Daily condensed the article.
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