Ex-Eurozone Chief Says Creditors Asked Too Much, Greece No Success Story

FILE - Dutch Finance Minister and chair of the Eurogroup Jeroen Dijsselbloem. (AP Photo/Petros Giannakouris)

Former Eurozone chief Jeroen Dijsselbloem said Greece’s international creditors were too demanding in austerity in return for three bailouts of 326 billion euros ($378.86 billion) to save an economy undermined by generations of wild overspending and runaway patronage.

Speaking to the TV program Nieussuur in his home country of The Netherlands, he said that,
“On reforms, we have asked a lot from the Greek people, too much. Reforms are hard enough to accomplish in a society with a well-functioning government, but this was obviously not the case in Greece,” he said, piling on criticism from other creditors and European Union officials that Greece’s notoriously-dysfunctional government and clientelist system were the biggest reasons for the economic crisis.

“Greece is obviously not a success story,” Dijsselbloem said. “Their crisis has been so deep, that you can’t call it a success,” said Dijsselbloem, who held the line in insisting on harsh reforms that devastated Greek workers, pensioners and the poor while leaving unscathed the rich, oligarchs, politicians, Parliament workers and tax cheats.

Three rescue packages of 326 billion euros ($378.86 billion) from the Troika of the European Union-European Central Bank-European Stability Mechanism (EU-ECB-ESM) and the Washington, D.C.-based International Monetary Fund (IMF) ended on Aug. 20.

Big pay cuts, tax hikes, slashed pensions, worker firings, a cut in the minimum wage and dilution of workers rights were major causes in Greece’s economy shrinking by some 25 percent since asking for the first bailout, of 110 billion euros, ($127.84 billion) in 2010.

A second for 140 billion euros ($162.7 billion) was sought in 2012 by a coalition led by the New Democracy Conservatives who had denounced austerity while out of power but implemented it to get the money once in power.

The third bailout, of 86 billion euros, ($99.94 billion) was sought in the summer of 2015 by Prime Minister and Radical Left SYRIZA leader Alexis Tsipras who also broke anti-austerity promises to plead for help.

Nearly a third of Greeks were pushed into poverty with even the IMF saying austerity didn’t work, as the country’s debt keeps growing, even after stiffing investors in 2011 with 74 percent losses in their holdings in devalued Greek bonds.

ECB policymaker Jens Weidmann earlker warned Greece still faces “a long road to recovery” after leaving the bailouts, with the creditors saying the economy will need monitoring for years to make sure fiscal targets are hit and the bailouts can be repaid. A debt relief agreement has given Greece until 2060 for final repayment.

“The end of the third adjustment program is not the finishing line, but a milestone on a long road to recovery. “The route to future prosperity for Greece could lie in proving in the years ahead that it can stick to a sound fiscal path,” he said.

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