Tuesday, 22 September 2015

Emotional masterbators love Greece.

Everyone likes weeping and wailing about economic and social problems. Everyone likes having a grievance to nurse. And social / economic problems enable sociologists and economists to witter on about and publish stuff about “neoliberalism” and whatever else is flavour of the month. But suggest a solution to those problems, and eyes glaze over.

Just for example, and on the emotional front there’s several thousand words from Bill Mitchell here (complete with pictures)  about the decrepit state of Porto, Portugal’s second city.

And there’s more thousands of tear jerking words on Greece’s fishing industry, complete with videos, in the Wall Street Journal.

You’d think the WSJ of all newspapers would concentrate on the TECHNICALITIES of Greece’s problems. But the WSJ like any successful newspaper knows what sells copy: emotion. Relatively few people are interested in logic.

Well I hate to interrupt the orgy of emotional masterbation, but I’ve got a simple solution for Greece. It’s to let Greece deal with its external deficit and debts by having it impose import tariffs.

There is absolutely no question but that in principle or in theory tariffs would enable Greece to return to more or less full employment. Extra demand normally sucks in imports and worsens a country’s external debts, but that wouldn’t happen given import tariffs.

As distinct from “in principle”, there the practicalities of tariffs. I’m not an expert on that. But most European countries had import tariffs prior to joining the EU. Thus I don’t see anything impractical about them.

Plus if you regard Grexit as problematic there’s much to be said for tariffs: they would enable Greece to reap the benefits of Grexit (i.e. devaluation) without leaving the EZ.

Objections to tariffs.

One obvious objection to tariffs that they’re not in keeping with one of the basic ideas of the EU, namely free trade. My answer is “so what?” Which do you prefer: a temporary change in the rules governing imports to Greece, or second, continued disastrous levels of unemployment?

Another not bad objection to the above tariff idea is that ultimately Greece has to get its costs down, and doing that requires a period of deficient demand and relatively high unemployment. Well my answer to that is that (as Simon Wren-Lewis suggested), while getting costs down does require SOME UNEMPLOYMENT, it probably does not require the DRACONIAN levels of unemployment that currently afflict Greece.

I actually suggested the tariff idea here, and Heiner Flassbeck suggested the same. However there’s not been a glimmer of interest.

I can only apologies for attempting to remove grievances which people derive pleasure from nursing. And having made that apology, I expect the mass ranks of emotional masterbators to apologise for pretending to be concerned about problems which bring misery, when in fact they’re mainly out for emotional kicks. (Not that there's much chance of the latter apology actually being made).

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