| First, let's explode the idea of parity: German median income is almost twice that of Greece. Greeks work longer and have fewer holidays. The average age of Greek retirement is actually higher than Germany's. http://www.newstatesman.com/blogs/world-affairs/2012/05/expl... for more of the same. So already the popular notion that hard-working Germans tax-payers are actually paying for those lazy, feckless Greeks is wrong. It also has nasty racist and fascist undertones, but let's put that aside. Furthermore, it gets the causality backwards: the labor rollbacks and public cuts inflicted on German workers created the surplus that German banks speculatively invested in dubious Greek enterprises and Spanish construction projects in the 2000s. Broadly, through the 2000s, Germany embraced neoliberalism, labour got squeezed, profits shot up, and a surplus accumulated. That surplus then needed a place to invest. Those investments went to, among other dubious places, the (famously) fiscally irresponsible Greek government and corrupt Greek enterprises. But investment isn't aid, of course. There's no gift. German banks were betting on a return when they loaded Greece and other countries up with debt. Of course a creditor nation also enjoys many political privileges over its debtors, so German politicians were happy, too. Better yet, that same capital flow was being recycled back into German manufacturing by inflating demand for German exports from those countries! Living beyond their means often meant buying German goods! A giant circulation machine had formed that helped the Germany economy nearly double in 10 years. In 2008, the slow slide of Italy, Spain, Greece, etc. into the status of 'debtor nations' was brought to a halt by the liquidity crisis. Everyone stopped fantasizing about endless debt-fueled growth. Germany banks and the ECB became more cautious. The circulation halted, and the Greek, Spanish, Italian economies, which distorted by malinvestment and terrible bubbles, collapsed. Now we see the vulturism of austerity. You know, at one point in 2012 Germany actually proposed replacing the Greek budget and tax functions wholesale -- what else of a country's polity is left? That's economic occupation. So, to sum up, we have the perverse situation where the banks which caused the crisis are being bailed out by the citizens of a country whose economy was wrecked by the same capital flows the banks mishandled! The Germans citizens aren't bailing out the Greeks citizens. The Greek citizens are bailing out the German banks that lent money to corrupt Greek politicians, by endlessly renewing all that toxic debt that rightly should be written off. Of course, this should sound familiar, because it happened first in the US in 2008. Again, banks won, ordinary people paid dearly. Beware the narrative about Germans paying for Greek mistakes. It's wrong, quite disgustingly wrong, and the truth is almost the exact opposite. |