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On 21/09/2012 23:13, Marv Gandall wrote:
It didn't have this effect in Argentina, which broke its peg to the dollar and defaulted on its external debt in 2001 after a long period of IMF-imposed austerity, so it can't be taken for granted that leaving the euro will be worse for the Greek masses than the misery they're currently experiencing.
I think there are reasons why the situations are not equivalent. Some of it you've pointed at yourself: Argentinian exports and so on. Some of it is that Greece doesn't have a euro peg, it has the euro. Creating a new currency is a different sort of thing from unpegging.
Furthermore, if we postulate that the European monetary authorities would be willing to agree to a saner debt restructuring under the threat of a disorderly default and exit, why not under threat of a disorderly default without exit? Greece can't be pushed out of the EZ by the treaties, and the decision to default still belongs to it, so I see no benefit in exiting, especially since one hears Greece is in primary public surplus at this time.
I'm guided by this analysis, mostly: http://yanisvaroufakis.eu/2012/05/16/weisbrot-and-krugman-are-wrong-greece-cannot-pull-off-an-argentina/
--David. ________________________________________________ Send list submissions to: Marxism@greenhouse.economics.utah.edu Set your options at: http://greenhouse.economics.utah.edu/mailman/options/marxism/archive%40mail-archive.com
