By Valentin Mândrăşescu, Voice of Russia
Greece is presented as a poster child for the IMF's ability to turn around a failing economy. The reality is far from the rosy propaganda presented by the mainstream media and the Greek government. Experience proves that countries "helped" by the IMF usually end up worse off and Greece is the latest proof of the Fund's inability to properly manage a bankrupt economy.
The logic of austerity measures imposed by the EU and the IMF was to reduce government expenses, trim corruption, balance the national budget and create a more competitive economy. The results are less than stellar. According to Hellastat, the country's official statistic service, the austerity program resulted in Greeks eating less bread and pastry, reducing the turnover of the 191 surveyed bread making firms by 5.9 percent.
Ekathimerini reports that a survey commissioned by the Federation of Greek Bakers found "that one in every five consumers reduced their bread consumption in 2012, contributing to nine out of 10 bakeries recording a drop in revenues that amounted to 36.7 percent on average."
The European banks who contributed to the growth of the country's exuberant debt remain unaffected while ordinary Greeks eat less bread. Goldman Sachs, the bank that helped the government of Greece to cook its books in order to join the Eurozone, is doing fine but the companies making bread are experiencing record drops in revenue. It sounds like the IMF-imposed austerity program is not targeting the government or the banks, but is affecting the basic needs of the country's poor.
Another consequence of the badly engineered austerity policy is that Greek employers have to deal with a constant liquidity crunch. A survey conducted by the Labor Institute of the Confederation of Labor Unions (GSEE), quoted by KTG, shows that paying only 1/3 of the salary in cash is a widespread practice in Greece. The rest is paid in coupons for various items and services, like free nights in hostels. Even in this truncated form, salaries are often delayed 3 to 12 months.
The banks saved by the IMF and the Greek taxpayers are not willing to provide liquidity to the Greek economy. The most startling result of the IMF austerity program is that Greece has gone back to a Middle Ages economy. Bankers are happy with it, but then nobody should be surprised by the rise of nationalistic and radical parties in Greece. Hunger and poverty are the perfect stimuli for the popularity of radical political forces.
cartoon © Chappatte,
