TROIKA’S ECONOMIC ADJUSTMENT PROGRAMMES FOR GREECE: HAVE THEY REALLY SUCCEEDED?, S. Mavroudeas, Oxford Brookes University lecture, 21/11/2018

 

 

 

 

 

 

 

You are invited to an Economics External

Speaker event on the topic:

 

TROIKA’S ECONOMIC ADJUSTMENT PROGRAMMES FOR GREECE: HAVE THEY REALLY SUCCEEDED?

Stavros Mavroudeas

 

In August 2018 the EU and the Greek government declared the successful completion of the 3rd Economic Adjustment Programme (EAP) for Greece. They also explicitly implied that the Greek crisis is over. We dispute the statements made by the EU and the Greek government and argue that Greek EAPs (a) rest on a problematic understanding of the Greek crisis (as simply a debt crisis), (b) applied a disastrous policy recipe in an attempt to deal with the crisis, and (c) failed systematically to achieve their own milestones. We will analyse the theoretical background of these programmes which lie in the neo-conservative notions of pro-cyclicality and growth- creating austerity. We will show that the Greek EAP’s basic structure is a very problematic modification of the typical 1990s IMF’s Structural Adjustment Programmes (as it lacks the lever of currency devaluation and had a belated, half-baked and ineffective debt restructuring). Finally, we will discuss the systematic failure of the Greek EAPs in achieving their own goals.

 

Stavros Mavroudeas is Professor of Political Economy at the Department of Economics, University of Macedonia, Greece. His research focuses on Marxist Political Economy, Development Economics, History of Economic Thought, and Greek Economic History.

 

DATE: 21 November 2018

TIME: 12:00 – 13:30

VENUE: JHBB302

Comment in Press TV News in Brief program on the conclusion of the 2nd review of the Greek Adjustment Program and its inability to solve the Greek crisis

The video of my comment in Press TV’s News in Brief program on the conclusion of the 2nd review of the Greek Adjustment Program and its inability to solve the Greek crisis.

The transcript of the comment is the following:

 

Comment in Press TV News in Brief program on the conclusion of the 2nd review of the Greek Adjustment Program and its inability to solve the Greek crisis

2-5-2017

 

The technical agreement (SLA) between the troika of Greece’s lenders (IMF-EU-ECB) – because a political agreement has to follow as well – is a sham. The whole bunch of declarations by the the IMF and the EU and the SYRIZA government are pretentious and not telling the truth. The Greek economy is in shambles. It is in a terrible condition with recession reigning for the seventh consecutive year. The Adjustment Program imposed upon the country by the EU and the IMF has aggravated this situation. Each review of this program and the additional austerity measures that are being taken within this program in order to bring it back in its own tracks aggravate further the recession of the Greek economy and the poverty of the great majority of the Greek people. In these conditions a dirty game is being played between the major partners of these agreements. The EU wants to impose these agreements upon Greece but it requires the tacit agreement of the IMF (that is by the US). The US, on the other hand, fear that they throw a lot of money in the desperate Greek case and also the new Trump administration has taken a more tough line towards the EU. This was the reason for which the negotiations for this second review took too long. That is the IMF created problems. The junior partner of this deal, that is the Greek government of SYRIZA, has capitulated completely. It gives whatever the foreign lenders require so long as the new austerity measures required are not to be applied during this and the next year. But to be applied by 2019, that is after the expiration of the SYRIZA government. This means that the new government would bear the costs and the burden of the new austerity measures. In total the new agreement does not solve the Greek crisis but it aggravates it as it puts another 3.5 to 4 bn euros austerity cuts upon a very weak economy. So, the problems lay ahead.

 

SYRIZA’s fake tug-of-war with the IMF on labour reforms

Following is the transcript of my intervention in today’s News in Press TV (that was marred by connection problems):

 

PRESS TV NEWS item:

Greece says it cannot comply with labor reforms demanded by the IMF as a condition for a third bailout.

Greek Labor Minister George Katrougalos said his government considers the IMF’s demand as a ban on the right of workers to negotiate wages and conditions on a collective basis. Katrougalos noted that a breakdown with the IMF on the issue could jeopardize its financing of the 96-billion dollar bailout and could undermine overall confidence in the deal. The labor Minister said however that Greece can no longer tolerate the deterioration of its workers’ state. Talks are set to be held on Wednesday between Greece and an EU-IMF mission over the country’s bailout future.

 

 

 

 

 

 

 

My comment:

This whole affair is a masquerade. It is a cheat game between IMF, EU and the SYRIZA government. The sad thing is that Greece and its people are paying the cost of this masquerade.

Let us decipher this cheat game.

The IMF, which primarily expresses the geopolitical and economic interests of the US, pressurizes

• the EU for a new Greek debt haircut. This is vehemently rejected by the EU (and Germany in particular)
• Greece for even more austerity and anti-popular reforms. Part of this new package is the more barbaric deregulation of labour relations (whose previous waves of deregulation have contributed to a dramatic increase in unemployment and an equally dramatic decrease in wages).

The IMF blackmails the other two that, unless its conditions are being met, it won’t participate in the third bailout and austerity programme for Greece that the SYRIZA government signed.

The EU wants a strict implementation of the austerity programme without a debt haircut. It considers only the case of an insubstantial debt reprofilling and that after the forthcoming German elections. It does not object in principle to more barbaric labour relations deregulation. But, on the other hand, it is more sensitive than the IMF to the possible disastrous political repercussions of such a move. Especially, it worries that such a bold move might rekindle social resistance – that is dormant after SYRIZA’s betrayal of the anti-austerity movement – and lead to uncontrolled political changes.

Finally, the terribly incompetent and untrustworthy SYRIZA government is the underdog in this cheat game. It simply tries to save its skin and cling as long as possible in power (given its already very low popularity). It might accept another wave of labour relations deregulation if it goes together with even an insubstantial debt reprofilling (that they think that they can ‘sell’ to the Greek public). Their problem is that they have no real power (either economic or in the form of popular support) to press their own objectives. So they are simply trying to find room to play between the positions of the two other big players. On top of that the SYRIZA government and particularly its Minister of Labour are habitual liars. A recent example of this is their public declarations that pensions will not be cut at the very same time that they literally ‘massacre’ them. So the minister’s supposedly intransigent declaration against the IMF’s demands does not hold much water.

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Published in COUNTERPUNCH

September 15, 2016

Cheat Game: SYRIZA’s Fake Tug-of-War With the IMF on Labor Reforms

by Stavros Mavroudeas

 

Cheat Game: SYRIZA’s Fake Tug-of-War With the IMF on Labor Reforms

Comment in Press TV News 19-7-2016 on IMF’s recent update of World Economic Outlook

This is the video of my comment in Press TV News 19-7-2016 on IMF’s recent update of World Economic Outlook (WEO) report

 

The main points are the following:

IMF has cut its projection for world economy’s growth in 2017. One of the main reasons offered for this cut is Brexit.

This report is another proof of IMF’s cunningness. IMF is a shrewd organisation that serves predominanty the US and Western imperialist interests but at the same time tries to show a respectable face. Thus, it does not want to be grossly disproved by facts as it already has such a dismal record (that is it has erred considerably in the past in its forecasts).

Now, the IMF tries to foment positive expectations about the future course of the world economy. This attitude follows from the Mainstream economics’ mandra about expectations being the main driver of the economy. In other words that if economic agents have positive expectations about the future then the world economy would fare better. Of course this is ‘bullshit economics’.

On the other hand, IMF fears a ‘triple dip’ after the global economic crisis of 2007-8 but does not want to admit it openly. The world economy is still in shambles as the main structural reasons behind the crisis has not disappeared. They have just been pushed under the carpet. So the IMF takes a guarded position.

However, IMF’s argument about the Brexit is pretty ideologically-driven. IMF was against Brexit and now, after the referendum, wants to portay this move as a negative one in order to discourage any other similar move. But IMF’s projection is simply an artefact. There is nothing materially significant in the current situation that we can measure so as to make a verdict about the negative impact of Brexit. It is indicative that before the referendum IMF trumpeted that Brexit would trigger a UK recession. However now it expects UK to grow by 1.7 % this year and 1.3% next year. That is weaker than the 1.9 and 2.2 per cent growth forecasts before the referendum, but the UK is still set to be the second-fastest growing economy in the Group of Seven industrialised nations this year – behind the United States – and third-fastest next year, behind the US and Canada.

So IMF’s argument is simply a political facade.