One of the reasons why my blog entries are dwindling is precisely because all recent economic data proves that the Eurocrisis is over. Overall the Eurozone has returned to growth and production figures as well as services figures are up just about everywhere. So the crisis is over, right? So we don’t need to keep grumbling and prophesying doom, right?
And then again perhaps not. How many times have we been told that this wretched crisis is over? Ah, but the figures haven’t been so good before, have they? But are the figures really good? Okay, some mild drop in unemployment, yes. Apart from Greece where it is rising, but the great end of the recession being trumpeted is due solely to German growth.
Southern Europe remains in the doldrums. Even the north is not doing so well. Look at The Netherlands. Greece will no doubt explode probably sooner rather than later, if not with a bang with a whimper. France, though appearing to pick up will never be competitive vis a vis Germany owing to the Euro and that holds for Italy and Spain too. So what more can we say without rehashing the same arguments the dogmatists now holding sway refuse to even consider?
Well we could say that the crisis is not over because this is not just another economic crisis. Greece in particular demonstrates that this is not a crisis but a complete and violent exercise in social engineering and a revolution (as in overturn) of social cohesion, values and the final nail in the coffin for its whole production base and very way of life.
How will this play out? What will come in the place of this catastrophe? Will Greece remain a debt colony as appears to be Germany’s choice, in that it wants to keep recycling Greek debt through more and more loans with more and more catastrophic conditions attached?
You see we have now got beyond the realm of economic analysis. We are now well in the realm of prophecy and omens. At the moment the omens for Greece are not good at all. We are in a complete impasse of failure while continuing to beat that wretched dead horse, and the Greek population does not react. It has been beaten to a pulp and is lying moribund in the gutter.
As Professor Varoufakis rightly points out, in an Economic Depression, the people become depressed too and therefore do not react. How long can this last? Will there even be a Greece at all at the end of the line? Another take is that people are just taking it like this because they feel that they can do nothing to change it. The attitude being, well what have we to gain by protest and so on, since we are powerless to change anything?
However, this ‘what have we to gain?’ may well change into “what have we got to lose?’ Nothing but our chains? You see, this is beyond economic analysis, beyond a crisis, this is part of a sea change in history. A landmark in the fortunes of mankind. And for all the talk that Greek recession and unemployment will last another twenty years, nobody has a clue what will happen. For better or for worse. Why twenty years and not ad infinitum, for instance?
So next time you read a forecast, either by the IMF or Central Banks or Labour Organisations or whoever, just take it with a pinch of salt. Nobody knows and nobody has a clue. Just as nobody (at least not one of the Very Serious People as Krugman calls them) saw the great sub prime crash coming either. Nobody had a clue. And that holds true now. It is, after all, a continuing process.
So brace yourselves.