Οι Αρνητικές Επιπτώσεις του Μνημονιακού Προγράμματος

Με ματιά ψύχραιμη, μακριά από πολιτικούς λαρυγγισμούς και συνθηματολογίες, ο Παναγιώτης Οικονομόπουλος αναδεικνύει απλά γιατί το πρόγραμμα στο οποίο μπήκε εκβιαστικά η χώρα είναι καταδικασμένο.  Γιατί η παγκόσμια αιφνίδια λατρεία στον Άνταμ Σμιθ δεν είναι τίποτα άλλο από αντίδραση στο χρεωκοπημένο μοντέλο του κοινωνικού κράτους.

Όπως και νάχει, τα άκρα είναι πάντα ανόητα και επικίνδυνα.

Οι Αρνητικές Επιπτώσεις του Μνημονιακού Προγράμματος 
1. Μετρα Δημοσιονομικης ΠροσαρμογηςΤο προγραμμα της τροικας/κυβερνησης υποστηριζει την υποθεση οτι  τα μετρα λιτοτητας και εσωτερικης υποτιμησης επιτυγχανουν ενα πρωτογενες πλεονασμα του προυπολογισμου της γενικης κυβερνησης και πλεονασμα εξωτερικων πληρωμων, τα οποια οδηγουν στην μειωση του επιτοκιου δανεισμου και απελευθερωνουν μελλοντικο διαθεσιμο εισοδημα και προσθετη χρηματοδοτηση με αποτελεσμα την αυξηση της σημερινης δαπανης και παραγωγικης διαδικασιας. Αυτη ομως η υποθεση εχει μικρες πιθανοτητες επιτυχιας.Η υφεση που συνοδευει την δημοσιονομικη προσαρμογη προκαλει 1) μειωση του πληθωρισμου, εστω και σταδιακα, που αυξανει την αξια του συσσωρευθεντος χρεους και 2) μειωση των τιμων των περιουσιακων στοιχειων που εξασφαλιζουν την κεφαλαιικη επαρκεια της περιουσιακης καταστασης των οικνομικων μοναδων. Συγχρονως η υφεση προκαλει πτωση του διαθεσιμου εισοδηματος και ως εκ τουτου αυξηση των προβληματικων δανειων. Το αποτελεσμα ολων αυτων ειναι η υποβαθμιση της πιστοληπτικης ικανοτητας των οικονομικων μοναδων, αποκλεισμο αυτων απο την δυνατοτητα χρηματοδοτησης των σχεδιων δαπανης και αυξηση του ασφαλιστρου κινδυνου που ανεβαζει το επιτοκιο δανεισμου. Η προσδοκουμενη μειωση των μελλοντικων φορολογικων υποχρεωσεων δεν οδηγει σε αυξηση της σημερινης δαπανης γιατι το διαθεσιμο εισοδημα ειναι μειωμενο και η δυνατοτητα δανεισμου περιορισμενη. Περαιτερω, η προσδοκουμενη αυξηση του εξωτερικου πλεονασματος δεν ειναι εξασφαλισμενη γιατι η  αυξηση της μισθολογικης ανταγωνιστικοτητας μπορει να μην ειναι ικανη να καλυψει την πτωση του διεθνους εισοδηματος, της παραγωγικοτητας απο την μειωση της εργατικης προσπαθειας και το υπαρχον συγκριτικο μεονεκτημα ποιοτητας των προιοντων εσωτερικης παραγωγης.

2. Ιδιωτικοποιησεις

Το προγραμμα βασιζεται στον ισχυρισμο οτι η μειωση της κρατικης δραστηριοτητας, μεσω της ιδιωτικοποιησης των κρατικων οργανισμων, “απελευθερωνει” συντελεστες παραγωγης και πορους παραγωγικης διαδικασιας οι οποιοι μπορουν να αξιοποιηθουν πιο αποτελεσματικα απο την ιδιωτικη πρωτοβουλια. Αλλα αυτη η αποκρατικοποιηση φυσικων μονοπολιων δεικτυων και υποδομων κοινωφελων υπηρεσιων/προιοντων δημιουργει συγκριτικο πλεονεκτημα και δυναμη σε ιδιωτικα συμφεροντα που αγοραζουν αυτους τους οργανισμους. Η εξαγορες, λογω υφεσης, εκτελουνται σε συνθηκες σημαντικης υποτιμησης της αξιας αυτων των οργανισμων και επιτρεπουν την κερδοσκοπικη εκμεταλευση μελλοντικων υπεραξιων των περιουσιακων στοιχειων τους σε βαρος της κοινοτητας των πολιτων χωρις να απαιτειται καμμια προσθετη επενδυση παραγωγικου δυναμικου. Αυτα τα ιδιωτικα συμφεροντα για να μεγιστοποιησουν το κερδος τους αυξανουν τις τιμες, περιοριζουν την προσφορα και την στρεφουν προς τους καταναλωτες που εχουν την αναλογη αγοραστικη δυναμη και αποκλειουν την προσβαση απο τους καταναλωτες που δεν εχουν την απαραιτητη ικανοτητα πληρωμης. Αυτη η συμπεριφορα προκαλει κοινωνικη και οικονομικη ανισοτητα συμμετοχης στην αξιοποιηση αυτων των κοινωφελων προιοντων απο τμηματα του πληθυσμου των οικονομικων μοναδων με εισοδηματικη αδυναμια.

3. Μεταρυθμιστικοι Οροι Επιχειρηματικης Δραστηριοτητας

α. Κοστος Εναρξης Επιχειρησεων

Μια σειρα μεταρυθμισεων  βασιζεται στην υποθεση οτι η καταργηση των γραφειοκρατικων προυποθεσεων, των προδιαγραφων λειτουργιας, των μετρων πιστοποιησης και αδειοδοτησης των νεων επιχειρησεων επιτρεπει την αναπτυξη της οικονομικης δραστηριοτητας μεσω της μειωσης του κοστους εναρξης αυτων των επιχειρησεων. Αυτη η απλοποιηση των ορων εναρξης δημιουργουν συνθηκες και κινδυνους συστασης επιχειρησεων υποβαθμισμενων προδιαγραφων, χαμηλης ποιοτητας παροχης προιοντων/υπηρεσιων, ανεπαρκους κεφαλαιου και επαγγελματικων γνωσεων οι οποιες προκαλουν ζημεια στους καταναλωτες, δανειστες και κεφαλαιουχους αλλα και εχουν βραχυχρονια και μικρη πιθανοτητα επιβιωσης ωστε σπαταλουνται αξιολογοι οικονομικοι ποροι. Τελος η απελευθερωση της αδειοδοτησης μειωνει την μελλοντικη αξια της επιχειρησης και αυτο αποτελει αντικινητρο δημιουγιας νεων επιχειρησεων οταν η αδεια λειτουργιας των δεν εχει καποια αξια μεταπωλησης.

β. Ευελιξια Επιχειρηματικης Δρασης

Αυτη επιτυγχανεται με την απελευθερωση των κανονων ρυθμισης και λειτουργιας και τον περιορισμο των μετρων εποπτειας απο τις κρατικες αρχες με την δικαιολογια οτι η ευελιξια και η μειωση των αγκυλωσεων δραστηριοτητας επιτρεπει την ανταγωνιστικη επιβιωση των επιχειρησεων. Ομως αυτη η πολιτικη απορρυθμισης του ελεγχου λειτουργιας επιτρεπει την εκμεταλευση πραξεων αθεμιτου ανταγωνισμου και την δημιουργια συγκριτικου πλεονεκτηματος εναντι των ανταγωνιστων που ευνοει την συγκεντρωση της δραστηριοτητας η οποια με την σειρα της οδηγει στην συγκριτικη δυναμη εναντι των καταναλωτων. Αυτη με την σειρα της φερνει προνομιακη διαχειρηση, διαφθορα και ολιγοπολιακες πρακτικες και τιμολογησεις. Επισης δημιουργει κινδυνους παροχης υποβαθμισμενων προιοντων/υπηρεσιων και εκμεταλευση ασσυμετρης πληροφορησης σε βαρος των καταναλωτων. Το αποτελεσμα αυτων των στρεβλωσεων ειναι να δημιουργηθουν δομες μειωμενου ανταγωνισμου και περιορισμενης προστασιας των καταναλωτων.

γ. Αυτορυθμιση Αγορας

Το προγραμμα του μνημονιου υποστηριζει την υποθεση οτι η αγορα ιδιωτικων και ασυντονιστων χρονικα, τοπικα και προτιμησιακα συναλλαγων ειναι ικανη απο μονη της να αυτορυθμιζεται και να προσαρμοζεται σε τυχον διαταραξεις. Αυτη η υποθεση θεωρει οτι η κρατικη παρεμβαση σταθεροποιησης και εποπτειας οχι μονο δεν ειναι απαραιτητη αλλα και επιζημεια γιατι δημιουργει στρεβλωσεις των ορων συναλλαγης. Για αυτο η δημοσιονομικη πολιτικη πρεπει να αποφευγεται και το κρατος να διατηρει ενα περιορισμενο και ισοσκελισμενο προυπολογισμο. Η υποθεση ομως ειναι εσφαλμενη γιατι η πραγματικοτητα εχει αποδειξει οτι η αγορα των συναλλαγων δεν αυτορυθμιζεται, ειναι ασταθης και καταληγει σε συνεχεις κρισεις διαφορετικου μεγεθους! Η δημοσιονομικη πολιτικη επεμβασης στην οικονομια ειναι αναγκαια γιατι 1) η ιδιωτικη δραστηριοτητα βασιζεται σε κοινες υποδομες και υπηρεσιες που μονο το κρατος μπορει να χρηματοδοτησει και δημιουργησει μεσω δημοσιονομικων ελλειμματων (επενδυτικη πολιτικη) για τις οποιες ο ιδιωτης δεν εχει κινητρο κερδους να τις επενδυσει με βαση το κοινωνικο κοστος και 2) οι κυκλικες διακυμανσεις και κρισεις υφεσης και κερδοσκοπικης υπερβολης απαιτουν μετρα ελεγχου και σταθεροποιησης οπου στην πτωση του διαθεσιμου εισοδηματος η δημοσιονομικη πολιτικη καταληγει παθητικα ελλειμματικη και στην ανοδο του διαθεσιμου εισοδηματος  αυτη η πολιτικη καταληγει παθητικα πλεονασματικη. Ο κρατικος προυπολογισμος περιλαμβανει ενα τμημα παροχης κοινων υπηρεσιων  και επενδυσεων υποδομων και ενα τμημα συναρτησης της οικονομικης καταστασης σχεσεων αγορας και ιδιωτικου (παραγωγικου/χρηματοδοτικου) κεφαλαιου που εχει ταση να απορρυθμιζεται απο κερδοσκοπικη υπερβολη και να ενεργει σε καθεστως ευθραστης ασταθειας, κινδυνου και στενοτητας!

Παναγιώτης Οικονομόπουλος

 

Advertisements

The New Sick Man of Europe: the European Union

French Dispirited; Attitudes Diverge Sharply from Germans

Overview

The European Union is the new sick man of Europe. The effort over the past half century to create a more united Europe is now the principal casualty of the euro crisis. The European project now stands in disrepute across much of Europe.

2013-EU-01Support for European economic integration – the 1957 raison d’etre for creating the European Economic Community, the European Union’s predecessor – is down over last year in five of the eight European Union countries surveyed by the Pew Research Center in 2013. Positive views of the European Union are at or near their low point in most EU nations, even among the young, the hope for the EU’s future. The favorability of the EU has fallen from a median of 60% in 2012 to 45% in 2013. And only in Germany does at least half the public back giving more power to Brussels to deal with the current economic crisis.

The sick man label – attributed originally to Russian Czar Nicholas I in his description of the Ottoman Empire in the mid-19th century – has more recently been applied at different times over the past decade and a half to Germany, Italy, Portugal, Greece and France. But this fascination with the crisis country of the moment has masked a broader phenomenon: the erosion of Europeans’ faith in the animating principles that have driven so much of what they have accomplished internally.

The prolonged economic crisis has created centrifugal forces that are pulling European public opinion apart, separating the French from the Germans and the Germans from everyone else. The southern nations of Spain, Italy and Greece are becoming ever more estranged as evidenced by their frustration with Brussels, Berlin and the perceived unfairness of the economic system.

These negative sentiments are driven, in part, by the public’s generally glum mood about economic conditions and could well turn around if the European economy picks up. But Europe’s economic fortunes have worsened in the past year, and prospects for a rapid turnaround remain elusive. The International Monetary Fund expects the European Union economy to not grow at all in 2013 and to still be performing below its pre-crisis average in 2018. Nevertheless, despite the vocal political debate about austerity, a clear majority in five of eight countries surveyed still think the best way to solve their country’s economic problems is to cut government spending, not spend more money.

These are among the key findings of a new study by the Pew Research Center conducted in eight European Union nations among 7,646 respondents from March 2 to March 27, 2013.

A Dyspeptic France

No European country is becoming more dispirited and disillusioned faster than France. In just the past year, the public mood has soured dramatically across the board. The French are negative about the economy, with 91% saying it is doing badly, up 10 percentage points since 2012. They are negative about their leadership: 67% think President Francois Hollande is doing a lousy job handling the challenges posed by the economic crisis, a criticism of the president that is 24 points worse than that of his predecessor, Nicolas Sarkozy. The French are also beginning to doubt their commitment to the European project, with 77% believing European economic integration has made things worse for France, an increase of 14 points since last year. And 58% now have a bad impression of the European Union as an institution, up 18 points from 2012.

2013-EU-02

Even more dramatically, French attitudes have sharply diverged from German public opinion on a range of issues since the beginning of the euro crisis. Differences in opinion across the Rhine have long existed. But the French public mood is now looking less like that in Germany and more like that in the southern peripheral nations of Spain, Italy and Greece.

Positive assessment of the economy in France have fallen by more than half since before the crisis and is now comparable to that in the south. The French share similar worries about inflation and unemployment with the Spanish, the Italians and the Greeks at levels of concern not held by the Germans. Only the Greeks and Italians have less belief in the benefits of economic union than do the French. The French now have less faith in the European Union as an institution than do the Italians or the Spanish. And the French, like their southern European compatriots, have lost confidence in their elected leader.

Disillusionment with Elected Leaders

2013-EU-03Compounding their doubts about the Brussels-based European Union, Europeans are losing faith in the capacity of their own national leaders to cope with the economy’s woes. In most countries surveyed, fewer people today than a year ago think their national executive is doing a good job dealing with the euro crisis. This includes just 25% of the public in Italy, where the sitting Prime Minister Mario Monti was voted out while this survey was being conducted. Even the Germans, who overwhelmingly back their Chancellor Angela Merkel, are slightly more judgmental of her handling of Europe’s economic challenges than they were last year. And Merkel faces the voters in an election in September 2013.

Nevertheless, Merkel remains the most popular leader in Europe, by a wide margin. She enjoys majority approval for her handling of the European economic crisis in five of the eight nations surveyed. But in Greece (88%) and Spain (57%), majorities now say she has done a bad job, as do half (50%) of those surveyed in Italy.

Economic Gloom

2013-EU-04Most Europeans are profoundly concerned about the state of their economies. Just 1% of the Greeks, 3% of the Italians, 4% of the Spanish and 9% of the French think economic conditions are good. Only the Germans (75%) are pleased with their economy.

And the economic mood has worsened appreciably since before the euro crisis began. Positive sentiment is down 61 percentage points in Spain, 54 points in Britain, 22 points in Italy and 21 points in both the Czech Republic and France.

But despair about the economy may have bottomed out in some nations since 2012. Sentiment seems to have stabilized in the Czech Republic and Poland. And the mood can’t get much worse in Spain, Italy and Greece.

Most Europeans are almost as gloomy about the future. Just 11% of the French, 14% of the Greeks and Poles, and 15% of the Czechs think that their national economic situation will improve over the next 12 months.

2013-EU-05A median of 78% in the eight countries surveyed say a lack of jobs is a very big problem in their country. And a median of 71% cite the public debt. Except in Germany, overwhelming majorities in many countries say unemployment, the public debt, rising prices and the gap between the rich and the poor arevery important problems. Unemployment is the number one worry in seven of the eight countries. Inequality is the principle concern in Germany.

2013-EU-06Apprehension about economic mobility and inequality is also widespread. Across the eight nations polled, a median of 66%, including 90% of the French, think children today will be worse off financially than their parents when they grow up. A median of 77% believe that the economic system generally favors the wealthy. This includes 95% of the Greeks, 89% of the Spanish and 86% of the Italians. A median of 60% think the gap between the rich and the poor is a very big problem; that sentiment is felt by 84% of the Greeks and 75% of both the Italians and the Spanish. And a median of 85% say such inequality has increased in the past five years, a concern particularly prevalent among the Spanish (90%).

Absolute economic deprivation has long been less of an issue in Europe than in some other countries, thanks to the relatively robust European social safety net. But in the wake of economic hard times, deprivation in France is on the rise, where roughly one-in-five say they could not afford food, health care or clothing at some point in the past year.

The Southern Challenge

The euro crisis has created a southern challenge for the European Union. Spain, Italy and Greece have suffered greatly during the economic downturn. And the public mood in these countries is extremely bleak in both absolute and relative terms.

More than seven-in-ten Spanish (79%) and Greeks (72%) say economic conditions arevery bad. A majority of Italians (58%) say the same. This compares with a median of 28% for the rest of Europe. More than nine-in-ten in Greece (99%), Italy (97%) and Spain (94%) think the lack of employment opportunities is a very big problem (official unemployment in January 2013 was 27.2% in Greece and in March 2013 was 26.7% in Spain and 11.5% in Italy). Fully 94% of Greeks, 84% of Italians and 69% of Spanish complain that inflation also poses a very big challenge. This compares with a median of 58% elsewhere. And roughly seven-in-ten or more in all three countries fault their leader’s handing of the economic crisis.

2013-EU-07

Such economic gloom has fed disgruntlement with the European Union. In Greece, 78% now believe that economic integration has weakened the Greek economy, a sentiment about their economy shared by 75% of the Italians and 60% of the Spanish. As a result, nearly two-thirds (65%) of Greeks and about half (52%) of the Spanish have an unfavorable view of the EU. This compares with medians of 59% who question integration and 48% who take a critical view of the EU in the other five countries surveyed.

Concern about inequality is widespread throughout Europe, particularly in the south. A view that the economic system generally favors the wealthy is shared by 95% of the Greeks, 89% of the Spanish and 86% of the Italians. Such frustration exceeds the median of 72% in the other five nations surveyed. Similarly, 84% of the Greeks and 75% of the Italians and Spanish say the gap between the rich and the poor is a very big problem. That compares with a median of just 54% of the Europeans surveyed outside the region who hold such critical views.

So What to Do about the Euro Crisis?

When asked which of the economic challenges facing their countries their government should address first, people in seven of the eight nations choose the lack of employment opportunities. A median of 57% first want their elected leaders to create more jobs. And employment is a particular priority in Spain (72%), Italy (64%) and the Czech Republic (64%).

2013-EU-08Europeans are of two minds about public debt, which has been at the center of the debate over the euro crisis since it began. A majority in six of the eight countries surveyed consider debt avery big problem. When pressed to choose between reducing public expenditures and more spending, most publics choose the former, even in Spain (67%) and Italy (59%), despite the fact that people there have already experienced cutbacks in government spending, economic contraction and record high unemployment. Across Europe a median of 59% believe that reducing public debt is the best way to solve their country’s economic problems. But a median of only 17% think debt reduction should be their government’s number one economic priority.
2013-EU-09

Some Good News

Despite rising disillusionment with the European project, the euro, the common currency for 17 of the 27 European Union members, remains in public favor. More than six-in-ten people want to keep the euro as their currency in Greece (69%), Spain (67%), Germany (66%), Italy (64%) and France (63%). And support for the euro has actually increased in Italy and Spain since last year.

2013-EU-10Moreover, notwithstanding the fact that only 26% of the British public think being a member of the European Union has been good for their economy and just 43% hold positive views of the European Union, the British, who will hold a referendum on continued EU membership in 2017, remain evenly divided on leaving the EU: 46% say stay and 46% say go.

Differences Abound

Overall, the 2013 survey highlights more starkly than ever the differences between the views of Germans and other Europeans on a range of issues. And it underscores that, in some cases, those differences are growing. Germans feel better than others about the economy (by 66 points over the EU median), about their personal finances (by 26 points), about the future (by 12 points), about the European Union (by 17 points), about European economic integration (by 28 points) and about their own elected leadership (by 48 points).

2013-EU-100And the survey contradicts oft-repeated narratives about the Germans: that they are paranoid about inflation, disinclined to bail out their fellow Europeans and debt-obsessed. To the contrary, Germans are among the least likely of those surveyed to see inflation as avery big problem and the most likely among the richer European nations to be willing to provide financial assistance to other European Union countries that have major financial problems. And while Germans are worried about public debt, they are more concerned about inequality and equally concerned about unemployment.

The prominent role Germans have played in Europe’s response to the euro crisis has evoked decidedly mixed emotions from their fellow Europeans. In every country except Greece, people consider Germans the most trustworthy. At the same time, in six of the eight nations surveyed, people see the Germans as the least compassionate. And in five of the eight, they are considered the most arrogant. In the wake of the strict austerity measures imposed in Greece, Greek enmity toward the Germans knows little bound. Greeks consider the Germans to be the least trustworthy, the most arrogant and the least compassionate. But the Greeks themselves do not fare that well. They are considered the least trustworthy by the French, the Germans and the Czechs.

2013-EU-12

A New Progressive Political Economy

David Sainsbury

LONDON – In an article in Foreign Affairs entitled “The Future of History,” Francis Fukuyama pointed out that, despite widespread anger at Wall Street bailouts, there has been no great upsurge of support for left-wing political parties. Fukuyama attributed this – rightly, I believe – to a failure of ideas.

The 2008 financial crash revealed major flaws in the neoliberal view of capitalism, and an objective view of the last 35 years shows that the neoliberal model has not performed well relative to the previous 30 years in terms of economic growth, financial stability, and social justice. But a credible progressive alternative has yet to take shape.

What should be the main outlines of such an alternative? First, a progressive political economy must be based on a firm belief in capitalism – that is, on an economic system in which most of the assets are privately owned, and markets largely guide production and distribute income.

But it must also incorporate three defining progressive beliefs: the crucial role of institutions; the need for state involvement in their design in order to resolve conflicting interests and provide public goods; and social justice, defined as fairness, as an important measure of a country’s economic performance.

It was a great mistake of neoclassical economists not to see that capitalism is a socioeconomic system, and that institutions are an essential part of it. The recent financial crisis was made far worse by profound institutional failures, such as the high level of leverage that banks were permitted to have.

Empirical research has shown that four sets of institutions have a major impact on the performance of firms and, therefore, on a country’s economic growth. These include the institutions underpinning its financial and labor markets, its corporate-governance arrangements, its education and training system, and its national system of innovation (the network of public and private institutions that initiate and diffuse new technologies).

CommentsView/Create comment on this paragraphThe second defining belief of progressive thinking is that institutions do not evolve spontaneously, as neoliberals believe. The state must be involved in their design and reform. In the case of institutions underpinning labor and financial markets, as well as corporate governance, the state must mediate conflicting interests. Likewise, a country’s education and training system and its national system of innovation are largely public goods, which have to be provided by the state.

It should be clear that the role for the state that I have been describing is an enabling or market-supporting one. It is not the command-and-control role promoted by traditional socialists or the minimalist role beloved by neoliberals.

The third defining belief of progressive thinking rejects the neoliberal view that a country’s economic performance should be assessed solely in terms of GDP growth and freedom. If one is concerned with a society’s wellbeing, it is not possible to argue that a rich country in which the top 1% hold most of the wealth is performing better than a slightly less wealthy country in which prosperity is more widely shared.

Moreover, fairness is a better measure of social justice than equality. This is because it is difficult to devise practical and effective policies to achieve equality in a market economy. Moreover, there is a real tradeoff between equality and economic growth, and egalitarianism is not a popular policy even for many low-income people. In my experience, trade unions are much more interested in wage differentials than in a simple policy of equal pay for all.

These are the core principles that I believe a new progressive political economy should embrace. I also believe that Western countries that do not adopt this framework, and instead cling to a neoliberal political economy, will find it increasingly difficult to innovate and grow.

In the new global economy, which is awash with cheap labor, Western economies will not be able to compete in a “race to the bottom,” with firms seeking ever-cheaper labor, land, and capital, and governments seeking to attract them by deregulating and shrinking social benefits.

The only way Western economies will be able to compete and improve their standard of living is by seeing themselves as being involved in a race to the top. That is, firms must improve their value added through innovation in existing industries, and by developing the capability to compete in new and more sophisticated industries, where value added is generally higher.

Companies will be able to do this only if governments abandon the belief that they have no role to play in the economy. In fact, the state has a key role to play in providing the conditions that enable dynamic companies to innovate and grow.

Source

http://www.project-syndicate.org/commentary/david-sainsbury-says-that-countries-that-cling-to-neoliberal-pieties-will-be-unable-to-compete-globally#yTXb4EPZzFoRXhiu.99

Greece: austerity takes a heavy toll on public health

A paper published in today’s Lancet draws attention to the plight of Greece’s most vulnerable groups who are faced with cuts in the healthcare services they need urgently. Lead author Alexander Kentikelenis describes the situation as a “public health tragedy”.

 

The data reveals that the Greek welfare state has failed to protect people at the time they needed support the most.

Alexander Kentikelenis

Austerity measures in Greece, imposed following a bailout by the international community, have led to devastating social and health consequences for the country’s population, according to a report in yesterday’s Lancet.

Greece’s health crisis: from austerity to denialism, a paper by Cambridge University sociologist Alexander Kentikelenis and colleagues, shows how rising demand for healthcare as a result of the cuts has coincided with a drop in the provision of services, leading to substantial unmet medical need.

In 2010 the Greek government agreed to an austerity package overseen by the European Union, the European Central Bank and the International Monetary Fund, known collectively as the Troika. Since then, Greece has had the largest cutbacks to the health sector seen across Europe, as the bailout package capped public expenditure at 6% of GDP. The country’s public spending on health is now less than any of the other pre-2004 EU members.

“The data reveals that the Greek welfare state has failed to protect people at the time they needed support the most. A rapidly growing number of Greeks are losing access to healthcare as a result of budget cuts and unemployment,” said Kentikelenis.

The authors of the paper acknowledge that Greece’s healthcare system was in need of reorganisation well before its economic plight came to the world’s attention. However, they take the government to task for its denial that the health of the population has been affected as a result of the slashing of budgets.

At a time of increasing health need and falling incomes, Greece’s bailout agreement stipulated shifting the cost of healthcare to patients. The Greek government introduced new charges for visits to outpatient clinics and higher costs for medicines.

The authors’ analysis of the latest available data from the EU Statistics on Income and Living Conditions revealed a 47% rise in people who felt they did not receive medically necessary healthcare. This increase was linked to a rising inability to afford care and the costs of travel to access health services, according to the authors. Rapidly increasing unemployment since 2009 meant a growing number of people no longer had any form of health cover.

“Those without insurance would have been eligible for a basic package of health services after means testing, but the criteria for means testing have not been updated to take account of the new social reality,” said Kentikelenis.

“To respond to unmet need, social clinics staffed by volunteer doctors have sprung up in urban centres. Before the crisis such services mostly targeted immigrant populations, but now as many as half the patients are Greek nationals.”

The health problems are particularly pronounced among Greece’s most vulnerable groups who include the poor, the unemployed, the elderly, pregnant women and children, and those with mental health problems. The paper describes the situation faced by these groups as a “public health tragedy”.

There has been a 120% increase in the use of mental health services at a time of funding cuts of 20% in 2010-2011 and a further 55% in 2011-2012. Suicides and the incidence of major depression have rapidly risen.

Austerity measures have also been linked to increased incidence of infectious disease. Following cuts to outreach programmes, including the distribution of syringes and condoms to injection-drug users, in the first year of austerity, a rapid rise of HIV infections was observed: from 15 in 2009 to 484 in 2012. The incidence of tuberculosis among drug users more than doubled in 2013.

Kentikelenis and co-authors point to the experiences of other countries – notably, Iceland and Finland – in surviving financial crises. They argue that, by ring-fencing health and social budgets, and concentrating austerity measures elsewhere, governments can offset the harmful effect of crises on the health of their populations.

“Although the Greek healthcare system had serious inefficiencies before the crisis, the scale and speed of imposed change have constrained the capacity of the public health system to respond to the needs of the population at a time of heightened demand,” Kentikelenis said.

The paper Greece’s health crisis: from austerity to denialism by Alexander Kentikelenis (University of Cambridge), Marina Karanikolos (London School of Hygiene and Tropical Medicine), Aaaron Reeves (University of Oxford), Martin McKee (London School of Hygiene and Tropical Medicine) and David Stuckler (University of Oxford) was published by the Lancet on 21 February 2014.

For more information about this story contact Alexandra Buxton, Office of Communications, University of Cambridge, amb206@admin.cam.ac.uk  01223 761673

Inset image: Greeks protest austerity cuts

– See more at: http://www.cam.ac.uk/research/news/greece-austerity-takes-a-heavy-toll-on-public-health#sthash.JHLgHpVK.dpuf