Friday, April 05, 2013
cyprus and the eurozone
The west did not follow in Cyprus' footsteps; rather, it is the other way around. It is the west that encouraged Cyprus to embrace its model of financialisation, opening up to foreign capital and services. But this will no longer be the case. The austerity imposed by Germany and the IMF is so harsh that no cash is available any more to buy any commodity, whether "real" or "fictitious". Merkel's anti–inflationist and neo–liberal policy is undermining Germany's own export–led model of economic success. Austerity in the periphery is bound to hit core economies badly – in fact, it does already. In other words, Germany is digging its own grave but it has no right to take others down with it, including Britain, a country in which austerity has already become pronounced (new taxation on families and households, abolition of benefits etc.). If this analysis is by and large correct, then the Eurozone has no prospects of survival. Sooner or later it will disintegrate and it is almost certain that there are already contingency plans drawn up for this eventuality.more from Constantine Dimoulas and Vassilis K. Fouskas at Eurozine here.
Posted by Morgan Meis at 12:27 PM | Permalink