Michael Stephens — The “Success” of the Greek Bailouts

Along with ideology and pet economic theories, C. J. Polychroniou suggests another (far more cynical) interpretation [than the failure of austerity as a policy]. The bailout programs, he says, aresucceeding in some respects; the problem is that we may be incorrectly assuming what the main priorities are:

"Amazingly enough, in the face of this ongoing and uncontrolled catastrophe, and despite the IMF’s admission that it misjudged the impact of austerity on Greece’s economy and its people, IMF and EU officials remain as committed as ever to the policies responsible for Greece’s collapse. But while many seem surprised by this apparently contradictory posture, they shouldn’t be. The austerity “shock treatments” administered by the IMF and the EU have two explicit goals: (1) to ensure that the loans are paid back no matter what the cost, and (2) to roll back the average standard of living in order to create highly favorable conditions for international business-investment opportunities and to increase the rate of profit for the corporate and financial elite at home. It is an avowedly class-warfare approach, cloaked in the organization’s holier-than-thou rhetoric about the overall benefits of a neoliberal economic order and the economic drag created by organized labor and workers’ rights, social welfare provisions, and decent wages."

Doh. That was the neoliberal goal from the get-go and it hasn't changed a bit. It's straight up "disaster capitalism" as laid out by Naomi Klein. In fact, although the context is different, the policy is actually quite similar to the assassination of President Allende and installation of General Pinochet in Chile. Neoliberalism is antithetical to democracy and treats workers as a commodity in "the labor market." When C. J. Polychroniou says "roll back the average standard of living," this means reduction in the real wage, and lowering of benefits and protection for workers as well as public services. This is also an opportunity to privatize public resources and enclose more of the commons in order to monetize it "for greater efficiency" through market disciline. Multiplier Effect The “Success” of the Greek Bailouts Michael Stephens