The Adam Smith Institute a UK based neoliberal think tank and lobbying group based in the United Kingdom which advocates free-market ideas published an article about Greece as it nears its long-awaited exit from the bailout programme.
“The gushing praise from Angel Gurria, head of the OECD, the leader of a pro-capitalist group, was cheering the work of the leader of Greece’s radical leftists” Tim Worstall comments in his article.
“I would like to congratulate you, your administration and the whole of Greece for an impressive stabilisation effort and one of the most ambitious reform packages we have seen at the OECD in recent times,” said Gurria. “This is starting to bear fruit.”
But the arrival of growth, the writer argues, is not a vindication of what happened in Greece. The fact that it is only just returning is instead “a condemnation of what was done to that poor benighted populace”.
“Given the situation at the time, Greece could do one of two things. It could leave the euro and thus devalue just the one price, that of the currency. That also meaning defaulting on all that debt. Or it could stay in and have to go through an internal devaluation, all prices being forced down individually. Given the sacrosanct nature of the euro, the second was forced upon them.
This was and is a disaster, the effect has been as bad as the Great Depression upon the United States and it’s lasted for longer too.
The correct answer was default and devaluation, the correct answer to what they should have done is still default and devaluation.
Don’t let them convince us all that now growth is returning that the correct decision was made back then. It wasn’t and we shouldn’t forget that”.