Mansplaining why Greece, Spain and Italy should have never joined the Eurozone

Why is it that even fervent pro Remain British feel the need to enthusiastically nod their heads in agreement when yet again some pseudo economist mansplains why Greece, Spain and Italy never should have joined the Eurozone, why you can’t have a currency union without fiscal union and the Euro only benefits Germany?

I don’t know why such answers are so often upvoted by people who should know better.

Sure some of those answers even start with impressive eye opening statistics, but then soon are followed by conclusions where the flag doesn’t begin to cover the cargo.

I am so fed up with this whole ‘must have fiscal union’ thing for the Euro to work and South European countries must have their own currency to devaluate themselves out of trouble time and time again because they can only survive on us rich north European tourists tipping the waiters over there.

These statements are so often repeated in certain echo chamber bubbles, but seldom explore what the actual relationship is.

On top of that throw in a Nobel winner like Stiglitz, who’se Prize winning work had nothing to do with the Eurozone and it must be true.

I am with another economist on this one who quite easily debunks this nonsense.

Mankiw and Conventional Wisdom on Europe (https://johnhcochrane.blogspot.com/2015/07/mankiw-and-conventional-wisdom-on-europe.html)

About lasancmt

Passionate about Identity Management Disgusted at #ukip and #brexit
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2 Responses to Mansplaining why Greece, Spain and Italy should have never joined the Eurozone

  1. Ian says:

    Very useful. The Euro is widely scorned here in the UK. I have constantly defended it on line and as a complete non economist myself it is good to have some economist backup. But I would like to say to all economists in my most polite manner, “In the beginning (sounds like the Bible) in the beginning man was hunting and gathering. Then the roofer said to the farmer, “Give me some potatoes and I will fix your roof”. Then clever people thought, “This is a pain, let’s represent work and things with tokens, called money. And it has got to be fair otherwise people will get annoyed with each other.” Exchange rates that float up and down are potentially unfair and possibly ruinous if an exporter’s profit margin is wiped out. Changing from National currency to common currency was difficult but people learn, but once it is done and countries manage their economies responsibly I doubt that ther will be much trouble. We are reading that blog 4 years on and the doom forecasters seem to be wrong.

    • lasancmt says:

      Thank you for that comment Ian. I try to put myself in the shoes of poor Greek worker. Let’s assume for a moment the Greek Government still had that power to devaluate themselves out of trouble rather than addressing the real problems in their economy. Sure the Tourists will like it but the poor waiter that serves them just sees the price of that flat screen TV he was saving up for go out of his price range. If he rents the owner of the building sees it’s value shoot up and decides to increase the rent. Inflation eventually forces the wages up, but only after a lot of hardship of poor people. Not so much for the rich.

      With the Euro as our single currency it makes our economies more transparent. That can’t be a bad thing on my opinion.

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