Argitis, Giorgos, (2012), ‘Greece: Caught Fast in the Troika’s Austerity Trap’ , The Levy Economics Institute of Bard College, December.
On November 27, 2012, the Eurogroup reached a new “Greek deal” that once more discloses that there is no political will to address Greece’s debt crisis, or the country’s economic and social catastrophe. This fact increasingly makes Greeks think that the sovereign debt crisis incorporates significant geoeconomic and geopolitical interests at the expense of national sovereignty. Nonetheless, in the purely economic domain, there are two main aspects of the new agreement. The first is the condition imposed by the European Union (EU), European Central Bank, and International Monetary Fund—the “troika”—that Greece must adopt and apply a fiscal correction mechanism to “safeguard the achievement” of irrational and unrealistic fiscal growth and privatization targets. This mechanism will institutionalize economic austerity and the impoverishment of Greek workers in the private and public sectors, and squeeze to zero the degree of freedom for national economic policymaking.