Reflections on Greece – 4 – you can’t have politicians living in fear of banks

Posted on June 27 2011

I have argued that no country can devote its entire economic policy to maintaining an external marketplace,  and yet that is what the existence of the Eurozone  demanded of its member states.  Of course, they have failed to deliver: that is the whole basis of the current Greek crisis.

Now we have a crisis there is another aspect of the Euro worth noting.  When you put a currency at the core of your economic policy you put the bankers in charge.  Unsurprisingly  as a result the winners from this whole debacle  have been the banks.

The losers have been politicians across Europe, who've universally shown themselves unable to face up to the demands of those banks, or to have the intellectual capacity to make appropriate decisions when faced with a crisis within their economies.

There should be no surprise to this:  neoliberalism has ensured we have an enfeebled breed of politicians who think that anything that they do is bound to result in sub optimal outcomes for those they are meant to serve. Hardly surprisingly they are incapacitated as a result.

What we need is a new breed of politicians who do not live in fear of banks.  And they are only likely to come from the left.

 

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9 Responses

  1. Stephen Ferguson says:
    June 27 2011 at 6:03 pm

    Exactly. Our so-called political leaders are every bit as brainwashed as much of the media (a case in point: Evan Davies)…

    Source: “What’s Wrong with Neoclassical Orthodoxy?”, Wolfgang Kasper is emeritus professor of economics at the University of New South Wales, Australia

  2. Stephen Ferguson says:
    June 28 2011 at 8:11 am

    Exactly.
    Our so-called political leaders are every bit as brainwashed as much of the media (a case in point: Evan Davies)…their idendikit, tick-the-box education (Oxbridge PPE etc.), ensures an unthinking, uncritical attitude toward mainstream (neoclassical) economics:

    Generations of neoclassically blinkered lightweights have now been trained in the orthodox tradition. They occupy university chairs, editorial committees of professional journals, government offices, research outfits and the media. In other words, they have gained sufficient weight to mutually reinforce each other and promote a certain consensus about how the economy works and people ought to behave. To be part of the neoclassical tribe is comfortable and good for one’s career. And for the political elites and commentariat, who lack a deeper understanding of economics, it is also safe to accept the conventional consensus.

    “What’s Wrong with Neoclassical Orthodoxy?”, Wolfgang Kasper Emeritus Professor of Economics at the University of New South Wales, Australia

  3. Reflections on Greece – 5 – you can’t run a government without taxes » Tax Research UK says:
    June 28 2011 at 8:53 am

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  4. Reflections on Greece – 5 – you can’t run a government without taxes | called2account says:
    June 28 2011 at 9:08 am

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  5. The key lesson from Greece: you can’t run a government without taxes | Liberal Conspiracy says:
    June 28 2011 at 9:36 am

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  6. Benny Fitz-Crounger says:
    June 28 2011 at 11:42 am

    “What we need is a new breed of politicians who do not live in fear of banks. And they are only likely to come from the left.”

    Oh, so Gordon “I saved the banks/economy/world” Brown was from the right was he?

    • Richard Murphy says:
      June 28 2011 at 11:50 am

      Yes

      A neoliberal to the core

      • Phil says:
        June 28 2011 at 2:02 pm

        On this I have a different take, perhaps. I don’t see Gordon Brown as a neoliberal to the core, but I agree that he veered some distance rightwards and [naively] bought into neoliberal economics, big-time. His Chancellorship was undoubtedly neoliberal, but he wasn’t nearly as committed to neoliberalism as was Tony Blair.
        I think the inevitable crash, when it came, served to wake up Gordon. His changed attitude and policies afterwards saw a turn around in the economy, so much so that the economy crept back into [fragile] growth again in the final months of his premiership.

  7. Tax Reform Roundup – Smart Taxes Network says:
    June 30 2011 at 12:39 pm

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