The EU pronouncement of a Greek success ignores the reality

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1. What would be the reason that only 51.8% of the working age population in Greece is either working or looking for employment? It seems like that could be a problem all by itself. They are not all idle trust fund types are they?

2. Bill, thanks for this.

   I think there is a typo in this paragraph:

   “First, the average quarterly growth rate in the working age population between the March-quarter 2001 to March-quarter 2019 was 0.10 per cent.”

   I guess 2019 should read 2009?

3. The labels for the last graph are wrong.

4. Dear Adam Sawyer (at 2019/08/22 at 5:30 pm)

   Yes, thanks for the help.

   best wishes
   bill

5. Dear Allan (at 2019/08/22 at 6:09 pm)

   Yes, thanks for the help.

   best wishes
   bill

6. Truly sickening.

7. For what it’s worth, Nigel Farage, in his LBC radio show (available on Youtube) thinks that PM Johnson is “walking backwards” from “No Deal”, and will cobble together something like Theresa May’s “Brexit in name only” deal.
   He played a recording of what BJ had said to Merkel while in Berlin, and a translation of Merkel’s reply, the detail of which did tend to support the essence of Farage’s view. That deal would of course still have to pass through Parliament, somehow.

8. Max Boot wrote in the Washington Post in 2018 that “President Trump’s specialty is to create crises and then claim credit for solving them”. Sounds remarkably like the EU and Greece.

9. Those Guardian opinion writers seem to alternate between the terror of Brexit and Corbyn the antisemite (and Stalinist/Trotskyist) pieces. They scraped the barrel (without empirical support) a considerable time ago. The latest ones I read likened Brexit to 1914 when the comparison of the French pushing the Euro deal (and this time Germany happily accepting) leading to economic and social disaster and a rise in right wing populism , is rather more comparable to the Treaty of Versailles. Then there was the UK and Italy becoming kin as the bad twins in Europe. With the impoverishment of their people, there is every reason for both countries to be less easy to govern, but the bad twins at the heart of the EU are of course the elites of France and Germany (again).

10. I have to wonder why there is so much angst on the part of the Brits about exiting the EU? They’re exit experts: https://www.youtube.com/watch?v=e2Tn4uOSe6o Map of British Empire (1492-2007)

11. So I was hoping for some answers or guesses about why the Greek labor force participation rate was at 51.8% for working age population. Cause that seems ridiculously low to me and it really does reduce my sympathy towards the plight of Greece and to what extent they might be victimized by the troika or EU or anyone else. But haven’t got any answers yet. So will write some ideas in the hope that someone will show them wrong or improve upon them or whatever.

    1- the stats are wrong. People are actually working (or seeking employment) but it isn’t reported.

    2- people don’t want to work. Maybe the pay isn’t worth the effort. Maybe the taxes are too high. Maybe they don’t really need to work and are happier not working. Not really any problem in other words.

    3- a very large percentage of the people that are physically and mentally able to work have already left the country in order to work. And that skews the statistics so much.

    4- Greeks have a whole lot of children and elderly that working age people need to take care of instead of working or looking for official employment.

    5- I am misunderstanding that the number 51.8 refers to the percentage of Greeks of working age who are actually working or are actually looking for work and it means something else.

12. jrbarch:-
    “I have to wonder why there is so much angst on the part of the Brits about exiting the EU? They’re exit experts…”

    Very amusing.

    But, disregarding the satirical intent, you are not comparing apples with apples. A retreat from empire (whilst meanwhile another empire – the American one – supplants it in its turn) is in no way comparable with Brexit, which is the reclaiming of those aspects of full national sovereignty the giving-up of which was attendant (on the part of all signatory states) upon signing the Treaty of Rome.

    But then of course you knew that already…

13. Jerry,

    Census data is always outdated, so there’s an effect of improperly counting a diaspora. Other than that, people stop looking for regular employment eventually. They might do small work on the parallel economy (repairs, painting and so on), they might have an undeclared, non tax-paying job, or they might believe there’s no point and try to wait it out, as you think.
    Without looking up numbers, I imagine the discrepancy is abnormal because long term hopelessness is abnormal.

14. Bill,
    I’ve been reading your blog for a few years now, as a layman not an economist, and am as convinced by MMT ideas as a layman could be. That said, I am confused about your stance on the UK’s membership of the EU. The UK isn’t subject to the euro countries’ austerity, instead we have our own Tory austerity and as such it would seem to me that the damaging effects of this dogma are irrelevant to Brexit. I’d be grateful if your readers could enlighten me further.

    A more important point is that the Brexit referendum was conducted entirely on the basis of lies. Lies about, inter alia, Britain’s financial contribution to the EU and about EU citizens (specifically Eastern Europeans) coming to work, quite legally, in the UK. It was nothing but xenophobia and the whole Leave argument is wrapped up in Empire nostalgia. There are no benefits whatever to leaving, unless you are Boris Johnson or a member of another right-wing nationalist party.

    The EU is far from perfect, as you have pointed out, but I cannot see any benefit for Britain in leaving, especially when the arguments for doing so are so poisonous. Surely only the EU’s trading rivals, like the USA and China, could benefit from our departure? I cannot see how the UK could strike better trade deals on its own than it could as part of a trading bloc with much greater bargaining power. Again, I’d be obliged to any readers who could throw more light on this.

    Just one thing – be gentle, after all, it is ignoramuses like me that will have to be convinced if our politicians are to embrace MMT thinking.

    Regards,

    Jack Kent

15. Jerry, The 52% labour force participation rate in Greece is shocking but nowhere near the lowest. Its less than 50% in India, 47% in Argentina, 42% in Puerto Rico, and 35% in Jordan! In the continental US, Mississippi and Kentucky had rates of less than 57% in 2015.

16. Thanks for those statistics Norman. Sometimes I forget that the world is a big place and not everywhere is similar to my locality.

    Thanks Paulo Marques. Yes I think hopelessness probably has something to do with it.

    Thinking more about it, 60 years ago in the US, a 50% labor force participation rate might have seemed ideal to many. Theoretically, the men would all go out and work and the women would all be doing unpaid work taking care of their households. Of course that wasn’t close to being true even then. And it wasn’t ideal for everyone.

17. Dear Jack Kent (at 2019/08/23 at 10:49 pm)

    I have written many blog posts about Brexit and the EU. Just search the relevant categories. I am not going to repeat the arguments ad nauseum.

    best wishes
    bill

18. @ Kent,
    I also am not an economist, and have been reading Bills blog for many months now.
    I was convinced by MMT over 5 years ago now, maybe over 7.

    I think your problem was starting from 2 assumptions that Bill disagrees with.
    1] That none of the EU’s dumb neo-liberal rules apply to it. Bill has said IIRC that some but not all do.
    2] That there is no hope that any party that is willing to take advantage of what MMT says is allowed to the UK will ever get a majority in Parliment. IIRC, Bill has said that in the EU there is no hope and out of the EU there is a lot of hope. That all it takes is one election going the right way. At least that a party would use MMT in secret like the Repubs and then the Repuds in the US have done under Reagan, Bush II and now Trump. [The Repubs became the Repuds during Pres. Clinton’s 2nd term.]

19. Dear Steve_American

    Thanks for your response. You are right about the assumptions I made. My point is that if the UK labours under its own Tory neoliberal austerity, how does leaving the EU solve anything? I have also assumed there is little hope of things changing, either in or out of the EU. Any UK election will either re-elect a Conservative government or a Labour one that also subscribes to neoliberalism, though with how much conviction I cannot say.

    During the Brexit referendum, little or no mention was made of neoliberal austerity therefore I cannot see how the 52% voted to leave because of opposition to this ideology. There is an argument that many of them voted against the effects of austerity but that isn’t the same thing. I would also ask why, if they were voting against neoliberalism, so many then voted for another Conservative government?

    It seems to me that the reasons for leaving the EU are altogether ignoble. If a referendum is won on the basis of lies and xenophobia, what is to become of us in the aftermath?

    Bill’s arguments against the EU are compelling, it is a far from perfect organisation. But what is achieved by the UK leaving it? Neoliberal austerity will continue to be inflicted on us and the far right is now emboldened. Bill might be right that there is hope outside the EU but at the moment there is little sign of any political will that would make that hope more than just theoretical.

    My assumptions may well be ill conceived and I’m obliged to you for bringing them to my attention. I’ll carry on worrying while bearing in mind that I might be entirely wrong to do so.

    Regards,

    Jack Kent

20. Kent, A little hope is infinitely better than NO hope. [Divide any number by zero and you get infinity.]
    Also, Bill is better able to judge how fast the British people are catching on to MMT. He is there giving the talks and meeting with the VIPs. He says he has some hope. IIRC.

    Remember, that ACC is going to end civilization in less than 30 years. We, or is that you in the UK, don’t have that much time to change things.

    I’m calling for American Progressives to mass in the streets to demonstrate that the Dems must nominate a Progressive in 2020. If the Dems don’t then Progressive should at least consider voting Green, at least if Trump will *not* win as a result. I don’t think that waiting until 2024 is going to give us time to save humanity. The same time constraint applies to the UK.

21. American_Steve,

    Your point on climate change is well made and Brexit does seem utterly irrelevant in that context. That said, tackling climate change in a thirty-year time frame is surely impossible if we carry on with the same economic system of ever more growth and consumption of resources? MMT could have a big part to play in our discussions of the future, if there were any meaningful discussions among those with the power to make changes. But I’m going off topic. Probably shouldn’t be so gloomy either, there are plenty of brave souls fighting the good fight even if our leaders won’t. I wish you luck in your campaigning, same to Bill in his efforts to spread the word.

    Regards,

    Jack Kent

22. @ Jack Kent

    In my eyes your posts could have been designed to convey a false impression. We readers are invited to imagine a naive, genuinely puzzled, humble seeker after truth, who honestly cannot conceive that any reasonable, non-xenophobic, person – least of all anyone declaring allegiance to MMT’s tenets to which you say you also fully subscribe – could possibly hold a point of view about Brexit in complete disagreement with his own – by implication incontrovertible and non-partisan – opinions.

    You profess (in line with that self-portrait) to be open to persuasion that you are wrong in the view of Brexit which you express but to me it seems manifestly clear that most of what you write belies that profession. Your view appears to me at least to be both unalterably-fixed and extremely partisan (from which it will be obvious that my own view is of a like character, though of the opposite persuasion; but at any rate I don’t profess to be open to persuasion that it’s wrong).

    For the avoidance of doubt, I must tell you that I myself have never been a xenophobe. It would be impossible to be one, as an Englishman who has happily made his home in another country (inside the EU) married to a native of that country, with a wide circle of relations by marriage and non-British friends. And I nevertheless support Brexit, for all the reasons Bill has so eloquently voiced.

23. Jack Kent, you wrote, “Your point on climate change is well made and Brexit does seem utterly irrelevant in that context.”
    You are either not thinking through all the elements of the problem or a troll. Brexit & MMT have everything to do with ACC. As long as austerity is the policy there is no way enough can be done to stop ACC fast enough to avoid a 4 deg. C world and the end of civilization, if not humanity.

    The EU rules require austerity, even by the UK {according to Bill}. So, Brexit is the necessary 1st step to allow the UK to begin to stop ACC.
    MMT allows much more deficit spending and this increased deficit spending also is necessary to stop ACC. In this case by all nations.
    Both are necessary to stop ACC world wide.

24. Steve_American

    I think I did acknowledge that MMT could (you may say must) have a part to play in the discussions to tackle global warming and the changes to our economic model. If I say that Britain’s membership of the EU seems irrelevant to this much bigger challenge, I am returning to my original point that, given we have imposed our own neoliberal austerity on ourselves, the problems caused by this ideology will beset us anyway, in or out. I remain unconvinced the Brexit will solve any of the UK’s problems, can only see the downside of such an outcome.

    My understanding of MMT is that Britain is not limited in its deficit spending by our EU membership since we do not use the Euro, so could we not implement these ideas already? If Bill has addressed this, I haven’t been able to find the article – will have another look.

    I am a little disappointed at the suggestion of trolling. I have, admittedly, an imperfect understanding of the economic arguments and of the EU, but my original questions were genuinely put and I am happy to be corrected if my limited understanding is misguided. I had hoped that this forum of well informed readers might be a good place to ask. As ever, I am obliged to you for taking the time to respond.

    Regards,

    Jack Kent

25. robert H

    I assure you, I am not being disingenuous. I am in two minds about the EU and have found Bill’s arguments against its neoliberal austerity policies to be persuasive. However, going back to my original point, if the British government imposes its own austerity policies, how will Brexit alleviate the consequences of them? How will we negotiate more favourable trade deals on our own than we could as part of a larger trading bloc? These are not rhetorical questions, I would like to engage with anyone who has the answers. If Bill has addressed these issues, and he tells me he has, I haven’t been able to find the relevant articles yet. Would appreciate any pointers.

    As to my suggestion that the referendum was conducted on the basis of lies and xenophobia, that is because I do not remember any lengthy debate on economic issues but plenty of dog-whistle politics on EU citizens, refugees and asylum seekers. I also remember doubtful claims about the UK’s contribution to the EU and how that money would be spent post Brexit. If little time was given to the economic debate, can we really argue that the Brexit decision was based on a sound economic understanding of the issues? If the weight of the Leave campaign was xenophobic, can we argue that this played no part in the decision? Difficult questions to answer, and if, as you say, I have made my own assumptions, I acknowledge that I might be wrong, in whole or in part. The point is, I have come to this forum for answers because Bill’s readers are well informed and I think you are the best people to help me to a better understanding of the economic/political arguments.

    Thanks, robert, for taking the time to respond.

    Regards,

    Jack Kent

26. Jack Kent wrote: “I cannot see how the UK could strike better trade deals on its own than it could as part of a trading bloc with much greater bargaining power. Again, I’d be obliged to any readers who could throw more light on this”

    Like you, I was always attracted to the ‘United Europe’ concept (as an antidote to the eternal nationalist wars in Europe), but since understanding MMT I accept the reasons for the terrible economic under-performance in much of Europe and the effects on the citizens eg the ‘yellow vest’ riots in France as that country is wracked by long term unemployment of c.10%. (nevermind underemployment…). And France has a higher standard of living than many countries on the continent… Macron says a lot of nice things about unity, but he can’t even run his own country. And Germany…can’t even ‘afford’ a decent a decent retirement income for its citizens, despite a massive trade surplus considered a sign of ‘success’.

    IMO, its more important that all central banks operate along MMT lines rather than the issue of national sovereignty as such; I’m sure the EU could be an entirely more successful project if this were the case; Greece could remain part of the EU area and be lifted back out of poverty in a short. time, if the ECB was MMT compliant.

    And vice versa: neoliberalism will continue to hinder Britain in or out of the EU, given the level of poverty and inequality that exist in Britain even now before exit. And btw, Corbyn seems to be unelectable, as are all parties of the Left at present (eg Australia) because all the Left has to offer is fiddling with tax transfers, which are not capable of actually eradicating entrenched poverty. An MMT JG is the only thing that can bring that about.

    As for climate change, obviously *all* the major players have to understand the MMT concept of money creation in the *public sector*, and countries like India, Indonesia, Brazil, and China will no doubt need *international* support as well. Brazil is burning for lack of support for alternatives to economic development.
    Keynes (with his global trade proposals) and Doc Evatt (with his international rules based system – no veto in the UNSC) had the necessary vision in 1944 and 1946 respectively, but those ideas died in the Cold War, and have yet to be resurrected….. hence no surprises we are now dealing with this Trump trade idiocy vis a vis China.

27. Kent, OK your problem is that you can’t imagine that the mind set of the voters of the UK can change. Neo-liberalism is here/there to stay. Bill is fighting to change that. Bill has seen a huge change in the last 6 mo. to a year. Now, MMT is a topic of conversation. It wasn’t before.

    I’m an American who used to spend a lot of time keeping up with the news. Five ya I retired to SE Asia so the Soc. Sc. money would go 3 to 4 times further. This means I can’t keep up like I did before. I don’t know the language, TV is gibberish to me now.
    . . As an American I knew less than Europeans about what is happening in Europe. Specifically, I didn’t follow the Brexit campaigns closely. And I was here and not in America any more. However, I don’t see that it matters that much why the voters voted or Brexit. What matters is how the vote came out.

    BTW, I call myself a progressive. I hate Liberals. I hate them because they embrace neo-liberal economics and they are intolerant of people who disagree with them on any one point. I hate neo-liberal economics because it has hollowed out the American middle-class. I hate intolerance because I *demand* the right to think for myself. I also hate Nazis, because they were very intolerant. They burned books, for Christ sake. They murdered well over 20M people {6M Jews, 6M others, and at least 4M Russian POWs were murdered or starved to death.} Anyone who chooses to call himself a Nazi is *scum* to me.
    . . I can tolerate a lot, the main thing I can’t tolerate is intolerance. He who starts being intolerant 1st is the one in the wrong. Just like he who throws the fist punch is the one who was/is in the wrong, etc.
    . . I could list some other examples but, I think I will not to avoid giving the Liberals here more reasons to hate me.

28. @ Jack Kent

    For what they may be worth, here are my answers to some of the questions you posed:-

    “… if the British government imposes its own austerity policies, how will Brexit alleviate the consequences of them?” It won’t, in and of itself. But a no-deal Brexit will force any government willy-nilly to throw austerity policies out the window. That’s already begun happening in anticipation.

    “How will we negotiate more favourable trade deals on our own than we could as part of a larger trading bloc?” I have no idea, and am inclined to share your scepticism. But personally, I’m happy to wait and see. It certainly isn’t going to be a walk in the park – but that doesn’t mean it’s impossible.

    “If little time was given to the economic debate, can we really argue that the Brexit decision was based on a sound economic understanding of the issues?” I think that’s a serious point, but one which arises not solely in connection with the 2016 referendum but ALL referendums. Not least the previous (1975) referendum on British membership of the EU! Referendums have been known to be used by dictators as an instrument for thwarting democracy; on the other hand the Swiss (who can hardly be said not to be democrats) swear by them and use them all the time. It’s a many-faceted question with no simple answer.

    ” I remain unconvinced the Brexit will solve any of the UK’s problems, can only see the downside of such an outcome”. You are of course completely entitled to your own opinion, and it’s clear that yours is shared by a lot of people. I for my part can only see the downside of continued EU membership (and not only for Britain, incidentally; there can be no question at all but that Greece for example would have been far better-off had she left the EU instead of knuckling-under to the Troika bullies/extortionists – and I think the same goes for Italy in principle, and probably some others too).

29. I need to clarify that last comment.
    I hate Nazis a huge lot more than I ‘hate’ liberals.
    In fact I just ‘intensely dislike’ Liberals.
    Liberals got me banned from another site because I think that a certain group should be treated differently than Liberals want to treat it.
    I base this not on race or religion. I base it totally on the terrible things they believe. To me it is just like disliking Nazis for what they believe. I know, using Nazis is frowned on. I was born in 1946, right after the war. Growing up we did it all the time. To me it just is a way of cutting to the final conclusion. If we agree that the worst case illustrates the point that there must be a line somewhere, then we can back off and see where to draw the line.
    . . A good example of this is gun control. We all agree that some military weapons can’t be allowed to be in the hands of everyone. For example, man carried, shoulder fired, anti-aircraft missiles; poison gas; etc. So, now that we all agree that the 2nd Amendment doesn’t cover all military weapons, can we get on with deciding just what weapons it does cover? And, why?
    . . I said this group should be treated differently. I didn’t say they should all be killed. Or that they should not be allowed to live in the US. I just think that some beliefs will result in actions down the road and some actions are so damaging to the nation that steps should be taken to reduce the chance those actions will be taken and also, that if the actions are taken the damage to the people of the nation will be lessened. Yes, the lines between OK steps and not OK steps are hard to draw. This is not a reason to not allow me to talk about the need for such steps on an internet forum.