Showing posts from June, 2015

Kevin Drumm's Crazy Uncle Ivan theory of Finance and Trade

In covering the Greek tragedy that is the Greek tragedy , Kevin Drumm espouses what I like to call the "Crazy Uncle Ivan" theory of finance and trade.  It's a popular mix of Mercantilism and Keynesianism which explains how rather than being the villain of this tragedy, Greece is actually the tragic hero. Kevin quotes the German view of the situation: "In Germany especially, the fear is that providing new loans to Greece without extracting more spending cuts represents a fateful step toward a so-called transfer union, with wealthier nations providing handouts to Greece and other weaker countries." The facts on the ground are quite clear.  Greece does in fact want German money, and there is really no way for Kevin and the liberal intelligentsia to deny this.  But perhaps if we step back, we can still blame Germany: But so far Europe has done next to nothing for Greece. They've made lots of loans, but mainly so that Greece could pay back its debt to sha