“In the most recent take of the Greek crisis, the IMF seems to have come out as being the reasonable part of the Troika as a result of its last minute release of a document where it said that Greece’s debt position was unsustainable and that any longer-term settlement of the crisis would require “debt relief measures that go far beyond what Europe has been willing to consider so far”. But a closer reading of that report (July 14, 2015) – An Update of IMF Staff’s Preliminary Public Debt Sustainability Analysis – tells me that the IMF hasn’t learned very much at all from the disastrous and repeated mistakes they made that have deepened and prolonged the Euro crisis. They are still hanging on to the neo-liberal mantra that if only Greece had followed the ‘structural reform’ program fully it would now be out of crisis and not in need of debt relief. It is a pipe dream that only these neo-liberals can contrive when their whacky ideas are confronted with the reality of the monetary system.
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What the EU and the IMF have failed to recognise is that when an economy is mired in a depression, as is Greece, attempting to engineer cuts in the fiscal balance (by tax hikes and/or public spending cuts) will be self-defeating because they reduce GDP.
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Structural changes require that resources shift from their current use to other more desired uses. When the economy is mired in depression, the transitions and mobility of resources is thwarted and no major gains eventuate.
The fact that the IMF still believes that Greece should accelerate its structural program tells me it hasn’t learned from its past major mistakes, which should have seen high ranking officials imprisoned for professional negligence.”