Back in 2010, Greece agreed to a number of austerity measures. In general, Greece met their obligations and is currently running a primary surplus.
Greece was told by the IMF, the Germans, and other that this would turn the Greek economy around. Greece clearly needed some austerity, however many of us argued austerity alone would be a disaster for Greece, and for Europe in general.
Below are the forecasts for Greece (IMF) and the actual results (Eurostat).
Clearly austerity alone failed. Sadly European officials like German Finance minister Wolfgang Schauble have not changed their views and apologized to the Greeks.
Here is an actual quote from Schauble in 2013:
"Nobody in Europe sees this contradiction between fiscal policy consolidation and growth,” Schauble said. “We have a growth-friendly process of consolidation, and we have sustainable growth, however you want to word it.”
A "growth friendly process"? "Sustainable growth"? Nonsense.…Calculated Risk
Opinion: Did Germany Fulfill their Promises? Did Austerity in Greece Deliver?
Bill McBride
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