The terrible human cost of Greece’s bailouts

The Lancet has published an analysis of changes in life expectancy in Greece during the recent crisis. […]

Greek mortality has worsened significantly since the beginning of the century. In 2000, the death rate per 100,000 people was 944.5. By 2016, it had risen to 1174.9, with most of the increase taking place from 2010 onwards.

Greece’s mortality increase stands in stark contrast to global death rates, which fell during this time. Even in Western Europe, where death rates rose slightly overall, no other country experienced a deterioration on this scale. […] Among the countries included in the study, Greece’s case appears to be exceptional. […]

The report says that as part of the bailout conditions, Greece’s total healthcare expenditure (public and private) fell from 9.8% of GDP in 2008 to 8.1% in 2014. An article published by the Lancet concurrently with the paper notes that, under pressure from the Troika, the Greek government cut public healthcare expenditure to 6% of GDP.

But during this time, Greek GDP shrank by more than a quarter. So total healthcare expenditure effectively shrank by 30%.

Let’s stop playing ‘blame the Greeks’. Babies, adolescents and young adults did not cause Greece’s debt disaster. But they are paying for it – with their lives.”

https://www.forbes.com/sites/francescoppola/2018/08/31/the-terrible-human-cost-of-greeces-bailouts/#756f77a24b31

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Lessons for the Eurozone from the Greek debt crisis [Charts]

“Mr. Centeno’s claim that ‘we have all learned our lessons’ from the Greek crisis is mealy-mouthed. The Eurozone’s leadership doesn’t seem to have learned anything at all. The Troika’s disastrous handling of the Greek crisis has driven Greece into the worst peacetime depression experienced by any advanced economy in recorded history. […]

But even if Greece manages to meet its targets, there is nothing ‘normal’ about forty-two years of sustained fiscal austerity. Nor does having to maintain such a draconian regime in any way constitute ‘regaining control’. […]

French and German banks were effectively bailed out by their own taxpayers. […]

Bank bailouts are unpopular. It was politically more convenient to blame ‘profligate Greeks’ for the bailout than to admit that French and German banks had lent foolishly, still less that bank regulators had been asleep at the wheel. Even today, the tone of Mr. Centeno’s comments places all responsibility for ensuring there are no further bailouts firmly on Greece. […]

The Eurozone has also failed to take on board the need for active management of balance of payments in a currency union where fiscal transfers are limited. […] Countries like Germany and the Netherlands can run persistently large current account surpluses without sanction.

Running a persistent current account surplus in a currency union is beggar-my neighbour policy. The Eurozone is not as closed as it was prior to the crisis, so the whole bloc is now running a current account surplus, mostly at the expense of the US. But the US is becoming increasingly intolerant of being forced into the role of consumer of last resort. Beggar-my-Atlantic-neighbour is no more sustainable than beggar-my-Aegean-neighbour.”

https://www.forbes.com/sites/francescoppola/2018/08/20/lessons-for-the-eurozone-from-the-greek-debt-crisis/#41835e0c55dd

The Greatest Depression

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“The Greek people have just lived through a Depression as deep as the Great Depression and considerably longer. It is now the greatest recorded peacetime Depression. […]

Despite all the pain the Greeks have endured to fix their country’s finances, Greece’s fiscal situation remains extremely precarious. The IMF staff predictions show absolutely no room for fiscal expansion, even though it is desperately needed, not least to relieve extremely high poverty levels. One in four people in Greece is living below the poverty line.

Greece’s government is critically hampered by ridiculously tight fiscal targets not of its own making. […]

In a few years’ time, when Greece once again faces debt default and Euro exit, what will the price of debt relief be? Well, unless there is a change of heart among Eurozone governments by then, the price will be yet more harsh spending cuts and tax rises, and perhaps another Depression. Greece does indeed have more pain to come.”

https://www.forbes.com/sites/francescoppola/2018/07/31/the-greatest-depression/#4db9de8d346d