Sunday, May 22, 2011

Eurozone & global systemics: Lessons from Greece's case

The following are excerpts from my 2 sets of comments/replies made to the blog post titled "Which straitjacket and life jacket for Eurozone Greece?" of May 21st in the Grahnlaw blog of my esteemed fellow EU tweeter & blogger Ralf Grahn.


I. Excerpt of my Comments to the original post in Grahnlaw:

2)Which brings me to my main point, from a Eurozone, EU and global analysis perspective:

Greece's case (*) is a very valuable lesson regarding the shortcomings and downright faults of the dominant dogmae in Finance, Economics, Policy, etc especially of the so called "West". And a rare opportunity to overhaul these dogmae in favour of ones that are closer to reality and human needs.

I could elaborate further here, but it could evolve into a proper book.

Let me mention 1 or 2 examples:

Reliance on stats: It has become an obsession in a world/universe which by its very nature is unpredictable and uncertain. Our "Western" craving for stats, technical analysis, and certainties in general has been leading Europe and North America down a dangerous path. Greece's case is a wake up call. But not many seem to have grasped that, at least yet.

Another example: Some seem to treat countries or economies as football teams or pions in a "fantasy Euro or global economic league" not only using parameters that are by their very nature at best incomplete but also faulty in philosophy. This has, inter alia, an effect on not focusing on the real economy but an economic/financial "video game" that has little to do with reality, ie what is experienced daily by real people and real companies, esp. SMEs, in Greece, Eurozone, EU, USA, the OECD etc.

Free market capitalism is failing and is highly unpopular even in the US and UK (see relevant BBC World surveys) because it is based on the faulty Economic, Financial, Policy and other dogmae I referred to above.

...

(*) All one has to do is spend even 1 hour facing the Acropolis in order to appreciate how the West's thinking in Economics, Finance, Policy, etc has swayed away from its roots into uncharted waters.


II. Excerpts from my reply to Ralf Grahn's comments on my comments to the original post in Grahnlaw:


... as an EU/European/global affairs analyst, it is not my job to analyse Greece per se. My job is to look at EU and Eurozone systemics thus my tweets and blog posts have not focused on Greece's or Portugal's or Ire;and's policy faults but rather the systemic faults at EZ & EU level, eg the effects of the uber hard Euro on most Eurozone products and services, be they Greek or even German!

What I stated in my initial comments is that "Greece's case is a very valuable lesson regarding the shortcomings and downright faults of the dominant dogmae in Finance, Economics, Policy, etc especially of the so called "West".". Elements of Greece's case are to be found IMO in the other PIIGS as well, as well as most other Eurozone & EU members. But they are compounded in Greece's case, thus being more evident. That is not a defense of Greece but rather severe criticism, from my EU/Eurozone/systemics POV re the dominant Economic, Financial and Policy dogmae in the "West". Greece's problems are merely the most severe ones. And my concern is that the EU, Eurozone and global lessons are not missed.

.......

.... It seems that the world nowadays is full of experts on what Greece should do. Thus I opt to focus on what, systemically, the Eurozone should do. 1) Adopt a more "moderate Euro" policy 2) consider the exit WTO option 3) move immediately to a political union. (1) and (3) are IMO absolute "musts".

Greece's debt is merely 4% of all Eurozone debt. Unless it learns the lessons from Greece, the EU or EZ or Europlus may "save" the Greek economy but lose the "European" one. I would think the objective should include both. But so far it seems that the lessons from Greece's problems have not be learned by the other 16. The recent report by DW "Red lights aflame as European students opt for sex work" for example shows how fragile are the systemics at the core of the core of the Eurozone, ie in Berlin!

Thus high time to rethink the Economic, Financial, Policy dogmae that the EU (and the US, ie the West) has been operating on, IMHO as an EU and global policy analyst!

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