Well, that's only a problem if you rely on deficit spending to prop up the budget.

No, you can't solve a foreign balance problem by curtailing the sovereign budget. That just shifts the foreign debt to private hands (all too often temporarily, as we have seen recently). You have to make foreigners buy more of your stuff, or buy less foreign stuff.

That means industrial policy, which costs money. Money that the ECB should be printing on demand. But which it is not because it is run by deficit errorists.

In the long run it seems some kind of structural reform is needed for Greece, to deal with the fact that wages have risen so fast that the productivity improvements of the export industry (including tourism, I suppose) hasn't managed to keep up, lowering the relative strength of Greek companies.

Again, that's not primarily a Greek issue. It's a matter of inadequate German wages causing a demand shortfall in the Eurozone, and that demand shortfall hitting those countries which did not engage in irresponsible wage suppression policies.

- Jake

Friends come and go. Enemies accumulate.