Keynes said that in a downturn government spending should increase to stimulate activity, and decrease in an upturn. This is the opposite of what has been done in Greece (and indeed all over Europe) and the results have failed everywhere. It's not even a matter of doing what is proven to work, it's just an ideological obsession with neoliberalism in order to wipe out the middle-class and enrich the top capitalist class even further.

Just think about how the "austerity" bullshit started in Europe, it started because of the banking crash in America. Most logical people concluded that the crash was caused by minimal to non-existent regulation of banking and investment, and that the solution was increased regulation. Of course the bankers and investors would not accept this, so they started this political movement of austerity which outright lied and said the crash was the result of "big government" and too much spending, it essentially blamed the people and the solution was to inflict pain on the people, they slandered the people of Europe as "lazy" in order to smash the welfare systems in Europe.

Strangely enough, the austerity movement only caught on with governments in Europe, in America, Canada, Australia etc they all knew it was bullshit (though you certainly had a lot of pushing back from the "Tea Party" and conservatives in America) and it never went anywhere.

Step it up Europe.

Does really everyone in Europe thinks this too? If only we could all agree that budgets must be balanced, governments must be efficient, corruption must be thought, ... then I would guess that there would also be more solidarity.

It's also that too many people do not trust others to actually stay responsible and so we remain prisoners of our own national narrowness. If only we had smart rules that were really binding for all.

For example Switzerland has a governmental debt brake since 2001 and it seems to work quite good. If Greece would have had it, it would be forced to adapt much before 2008. That would have been good.

So why not a debt brake (say balanced budget over last 5 years and deficit only if economy is shrinking) everywhere in Europe? Please note that this doesn't mean that you cannot spend a lot - you just need to increase taxes before if you want to spend the money.

It is abstract enough for everyone to agree. When it comes to applications, everybody disagrees on the meaning.

Yes because you are our little cherry pop!

Obama is pretty good at domestic politics and excellent at spin and electioneering. However, he has no real leadership skills and he's well below par as a statesman. Merkel is head and shoulders above him in skill level, whether you agree with her policies or not. I'm not a fan of Putin, but I can respect his abilities, and in my opinion he's more capable overall than Obama.

We've ended up with presidents with various skill levels, some great at domestic policy and lousy at international relations, and vice-versa; the great presidents have managed to balance the two, and the poor ones have been dismal at both, usually because they listened to too many people. I believe that long-term, in a century Obama will get a middle ranking for effectiveness from historians when viewing his overall legacy.

Congratulations to the people of Greece for making the right choice. And here's hoping the political leader's don't get cold feet and capitulate now. It's time for the beginning of the end of this neo-liberal (which is really fascism dressed up nice without so much bigotry) nightmare the world is going through.. If only the people's of other countries had the courage of you good folks.

A heartfelt THANK YOU from a fellow citizen of the world.

And that is exactly what has happened at least here, more banking regulations related to bank solvency etc. That's one of the reasons banks are much stricter with giving e.g. housing loans now, and don't necessarily give as good terms anymore. They justify this that the increased regulation and terms increase their expenses so they have to be more careful now.

That is quite a one-sided look at it, as if countries are not responsible at all for taking too much debt. Yes, banks should take risks into account and be taught (even the hard way) that even government debts might not be socialized, but that doesn't refute the fact that countries are still responsible for their spending.

You seem to consider governments as some kind of irresponsible infants in a candy store who can't be held responsible for any decisions they make. It is only the candy store to be blamed.

Well, as I already explained, banking regulations were increased here, so I have no idea where you got the opposite idea.

Also, can you open up a bit what you mean by e.g. America not going with the "austerity bullshit"? Does this mean that US will bail out Puerto Rico after all, or not? Is that what rest of the EU should do with Greece as well, pull the plug? Then Greece is free of austerity?

Greece is an exception though. They never followed Keynes and had a deficit all the time for the last 20 years. They did not follow Keynes and if you only ever increase government spending you simply miss the decrease in the upturn, especially if the upturn never comes because your competitiveness is too low.

Surely the austerity was too strong in Europe between 2010 and 2015 and there was not enough stimulus to offset the necessary budget cuts which were necessary. It was the mistake of all the EU leaders (I mean they mostly all agreed to it, didn't they). They only did it half right which makes it kind of wrong.

It's a bit difficult because the euro zone is also inhomogeneous. On average it even grows (as little as 1% but still). So what does it mean according to Keynes? Increasing or decreasing government spending now?

As for US, GB, ... - their budget deficit and trade deficit are not that good either. For them according to Keynes it is probably now the time to have more austerity. Because if you never do it, it isn't Keynes either.

Actually in GB Tories successfully campaigned that they did austerity in 2012 and that this saved the economy (whether this is true or not ...) and won the last elections. So maybe if Labour instead would have been in charge and hadn't done the austerity in 2012, maybe the british economy would be in even better shape (it's barely at the height of 2007 now in 2015). I know many if's and when's but also the voter seems to be kind of confused what is better (austerity or deficit spending).

Economic prescriptions done by the IMF, EU or other, rarely work on this kind of scale.
In many cases it has even made things worse for the adoptive country.
Greece should follow Hungary's example and focus on re-building the internal economy, the domestic demand.
So it would be better for Greece to isolate itself for a while from the EU in order to build up its economy from the inside, once it is strong enough they could gradually re-integrate with the EU again.

Pulling the plug would be good, I don't even see why the nations in Europe put up with their policies being dictated by institutions like the EU and IMF. Are their not any political parties in Europe who want to leave the EU and the Euro (reinstate their own national currency), how can you even say European nations are sovereign and independent if they don't control their own currency and non-governmental institutions like the IMF have so much say?

I'm not sure if in Greece it's the same, but in my country the biggest problem is that politicians don't have to answer for the laws they make. So they can make up anything. The same people are in the parliament (or their offspring) since 1990 when the communism ended. If politicians would have to pay for stupid laws which incur losses for the country, that might make them more responsible. Alas, it's always the same crap. Romania when communism ended had zero debts and it actually had lots of outstanding money which it never got. Now we have around 40% GDP, up from 20% in 2008. Good job!

Depends what was meant by whoever allegedly said that.

Big problems in Greece, that has lead to the debt crisis:

- Too much government spending (compared to how much money they are making).

- Tax evasion is widespread. So the problem isn't necessarily that taxes are too low, but that they are not even collected that well.

I think IMF's argument was sound, of all the places where Syriza agrees to increase taxes, they shouldn't do it on the sector which is hoped to bring income to Greece.

I recall Syriza was against e.g. property tax, not sure why exactly. Does it somehow help the Greek economy and export industry if Syriza abolished that (again)?

Sure there are, but they are no majority currently. That's probably because people aren't convinced they are better off alone (in this world). And if you ask me, probably they aren't. What is so bad about EU? Yes, cooperating with others means you cannot have your will all the time. So what? The advantages by taking part in the cooperation still outweighs the loss of freedom. And much better to any part of the US or Russia or China, every part could indeed go if they wanted. But still they don't want. A big vote of confidence if you ask me.

IMF is not dictating Finland's economy any more than e.g. Australia's. They only seem to step in if some country gets into deep trouble. I think IMF didn't even want to meddle with Greece at first, but it was persuaded to do so. Also lately it kept showing less and less interest to participate in it, and anyway as Greece missed a payment to IMF, apparently IMF is not allowed by its own rules to meddle with Greece anymore (until they pay their debts).

Also don't forget that Greece could have said no to IMF and the other euro countries' bailout programs. They still could, but for some reason they still want to stay in euro, and want to start negotiations for new bailout programs.

Isn't being part of IMF voluntary anyway? If a country doesn't want to be an IMF member, then don't be.

There are parties all over Europe who are critical or openly against euro. I think in Poland the biggest opposition party says that if they win, Poland will not join euro. In Finland e.g. the center party and the "True Finns" were against joining euro, but nowadays they are not actively trying to get Finland out of it either, even though (or because) they are now in power. Not to mention Sweden, UK etc. which are not part of euro.

Having a common currency has both its benefits and drawbacks. I am not fully for or against being part of eurozone, albeit I don't like the late tendencies of trying to make all EU debts common. Why can't we be more like US and Puerto Rico, same currency but if you fuck up, you take care of the mess yourself? I still don't see why the same currency should somehow inherently indicate that either all debts are common, or there can't be no economic freedom at all for member countries (certainly some common rules must be there and part of the power is already on ECB, not on national banks...).