Noah denkt™  -
    Project for Philosophical Evaluations of the Economy
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The troika doesn’t seem to get the mix right
Dialogue with the Alter Ego on austerity in Greece, first drafted on March 1, published on March 2, 2012

Question by Alter Ego of Noah denkt™ (AE): A lot of wise men (Timothy Garton Ash among them) argue these
days that austerity alone won’t do the job in Greece but that it is necessary to offer a “growth perspective” to that
country. What is Noah denkt™’s take on that?
Answer by Noah denkt™ (Nd): Well, we can see where this is coming from.
After all, it is even clear to us that you
can’t squeeze more austerity out of the Greek people who have already sacrificed so much over the last three

AE: In other words, you are endorsing the idea of stimulus program in Greece similar to that of the Marshall Plan
just after WWII?
Nd: We continue to be skeptical about government-led stimulus programs. It seems to us as if the success of
these programs is pretty questionable. Just think about the lack of results which Obama’s Recovery and
Reinvestment Act of 2009 ($ 787 billion) produced. The whole thing turned out to be an incoherent jumble sale of
different initiatives that in the end served to no other purpose but to peddle to the interest of different political

AE: But there are also examples of government-led programs which in deed had pretty amazing success. Witness
Obama’s auto industry rescue. That worked out pretty nicely. And do not forget that the Marshall Plan was a huge
success too, particularly in Germany. So does it really make sense to be overly ideological in your reasoning
Nd: Well, if you look deeper your will find that there is quite a bit of difference between the mindset of post-war
Germany and that of Greece today. The reason why the Marshall Plan worked so incredibly well in Germany has
a lot to do with the fact that the German people were deeply ashamed and humiliated by the mess that they had
created in prior years. Hence, they were jumping at the first opportunity to immerse themselves into a
reconstruction project which would allow them to, at least for the time being, forget the disgrace which they had
heaped upon themselves. In Greece, however, you are looking at a completely different picture. Here the people
are angry and defiant. They do not understand and they do not want to understand why they are being made to
suffer. Much rather do they fell, as if it is others who are to be blamed for the mess that their country finds itself in
these days. Under these circumstances it is by no means clear whether a Marshall-type of plan will have the same
success in Greece as it had back when in Germany.

AE: If that is not the solution then, what are you suggesting instead?
Nd: We continue to stick by the basic guidelines which
we have expressed earlier in our growth and austerity
dialogue. In other words, we keep believing that is important to brutally save money on the government’s expense
side but we also believe that is a mistake to raise taxes in a country where the public administration has so
miserably failed its people.

AE: But if you do not raise taxes it is absolutely impossible to reach the austerity goals which have previously
been negotiated with the EU, the IMF and the European Central Bank.
Nd: That is certainly true. But it seems to us as if it may well be worth the while to encourage the troika into
rethinking parts of their approach in Greece. After all, it is becoming more and more obvious that the mix of
measures which they are recommending to Greece isn’t producing the results which we had all been hoping for.

AE: Do you really think that it is realistic that there will be a readjustment process here given that any change in
Greece will certainly lead all other suspects (Portugal, Spain etc.) to ask for the same.
Nd: Well, we try hard to never give up hope.
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growth and austerity, the troika's work in Greece, the troika's recipe's for Greece, how to stimulate growth, the
troika's recommendations for Greece, austerity an growth, saving the EURO, the troika's plan of action, the
troika's management of the European debit crisis