Greece: Syriza, the Economists and the Impossible Triangle

3ED2-ECB-EuclidTsakalotosPublished: 23 Jan 2015
Author: Michael Roberts

All the polls show that the leftist Syriza alliance is set to win the general election in Greece next Sunday.  It may not get an outright majority and may have to form a coalition with one of the small centre parties.  But it looks most likely that the incumbent coalition of Samaras? conservative New Democracy and the degenerated social-democrat PASOK will lose power.

Financial markets are getting worried and Greek government bonds have dropped sharply in price as investors fear a default.  Greek banks are losing deposits as Greek corporations and the rich (or at least those that have not already done so) shift their euros overseas.  Three banks are now asking for what is called Emergency Liquidity Assistance (ELA) from the Greek central bank (in effect, liquid funds from the Eurosystem controlled by the European Central Bank).

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Roberts: More on global wealth inequality, Davos and the Chinese princelings

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Much has been made of the headline from the recent Oxfam report on global wealth inequality that revealed that the richest 85 people in the world are worth more than the poorest 3.5 billion.wealth pyramid

The Oxfam data are actually taken from Credit Suisse?s 2013 global wealth report (global_wealth_report_2013.) But again this report comes from the earlier study by UN economists Tony Shorrocks (a former university colleague of mine) and Jim Davies using the UN wealth database. I reported on this study back in October.

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Faster growth in 2014?

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So here we are starting 2014 and heading towards seven full years since the global credit crunch began in summer 2007 and into the fifth year since the summer of 2009 when the Great Recession reached its trough and the global economic recovery began. What I said more or less at this time last year was:

In 2013, economic growth in the major economies is likely to be much the same as in 2012 ? pretty weak and below long-term averages. But 2013 is not likely to see a return of a big slump in capitalism. I do not expect the US to grow faster than in 2012 and Europe and Japan will struggle to grow at all. The key emerging economies may do a little better than in 2012, as China?s state-directed economy under new leaders invests more. But on the whole, it will be another poor year.

And so it has turned out more or less, even with the US economy. US average annual real GDP growth (including the Great Recession and an estimate for 2013) has been just 0.9% compared to 2.4% in the years before 2007 and way below the average real growth of the 1980s and 1990s.

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Mandela’s economic legacy

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The death of Nelson Mandela reminds us of the great victory that the black masses of South Africa achieved over the vicious, cruel and regressive apartheid system first encouraged by British imperialism and then adopted by a reactionary and racist white South African ruling class to preserve the privileges of a tiny few. Mandela spent 27 years in prison and the people he represented fought a long and hard battle to overthrow a grotesque regime, backed by the major imperialist powers, including the US, for decades.

Despite the efforts of the British Conservatives, particularly under Margaret Thatcher, the winer and diner-in-chief of all reactionaries globally, and the other imperialist leaders, the South African regime was eventually brought to its knees by the sacrifices of millions of black South Africans: the labour forces in the mines; the children in the schools and the people in the townships. They were backed by the solidarity actions of workers and people in the major countries through boycotts, strike action and political campaigning. It was a big defeat for the forces of reaction in Britain and America.

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