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On Jul 16, 2015, at 8:41 AM, Louis Proyect <l...@panix.com> wrote: > On 7/16/15 8:20 AM, Marv Gandall via Marxism wrote: >> Is the suggestion here that all of the peoples in the eurozone are >> trapped in it because the technical problems of converting to a >> sovereign currency are intractable, or is there something special >> about the technological structure of Greek capitalism? > > Absolutely not. But all this talk about Tsipras should have come up with a > "plan B" while he was in these intense negotiations with the eurozone bigs is > nuts. As I have repeatedly tried to explain, converting to a new currency > requires a full project life-cycle implementation just as it did moving from > a drachma to the euro. I have been involved with 5 such massive projects > during my career so I can guarantee you that it would take Greece or any > other euro-based nations a full 3 years to effect a change. As Doug pointed > out, such a declared intention would have consequences of capital drain. > > In any case, the challenge is more political than technical at this point. Well, yes. As, I noted two days ago on this thread: “The problem, Louis, as is so often the case, is less “technical” than it is political.” No one disputes that conversion from a stronger currency to a weaker one is economically wrenching, and inevitably results in capital flight. It has to be carefully managed by the state. Which is why it is preeminently a political rather than a technical issue. Your position has hitherto been that conversion to a new currency is so impossibly daunting that it should be ruled out, no matter how wretched the status quo - certainly in the case of Greece. You neglect to answer whether and why this rule would also be applicable to larger and more complex economies. But your fears about a Grexit being worse than the status quo seem greatly exaggerated, especially if an orderly Grexit can be arranged, which is in where the interests of the Greek people and the NATO powers converge for different reasons. That option has been on the table since Syriza took power, but its leadership, like yourself, has feared it as too radical a step and consequently did nothing to prepare the people and the state administration for that possibility. In fact, it actively discouraged speculation about a Grexit for fear of further antagonizing the troika. As for capital flight, it can take wings anytime where there is a perception that assets may be threatened by a left wing leadership susceptible to pressures from its restless base. Don’t take power if you don’t want to frighten away foreign and domestic capital. It is no more complicated than that. We know that even though the Syriza government bent over backwards to assure its creditors and depositors of its unshakeable commitment to the euro, euros continued to drain out of the country. In these circumstances, the Tsipras leadership was confronted with the stark choice of imposing more stringent capital controls, nationalizing the insolvent Greek banks, issuing a parallel currency, repudiating the debt, and inviting the US and Europe to negotiate in their own economic and geopolitical interests on that basis, or…abjectly accepting further cuts to the labour and pension rights of its followers, a further squeeze on their incomes, and the de-nationalization of important public assets. You’d have a difficult time persuading me it made the right choice because the difficulties of a “full project life cycle implementation” somehow trumped all these other considerations. _________________________________________________________ Full posting guidelines at: http://www.marxmail.org/sub.htm Set your options at: http://lists.csbs.utah.edu/options/marxism/archive%40mail-archive.com
