What is one supposed to do when confronted by arguments that seem to me--and to everybody else who has been right about the evolution of the North Atlantic economy since 2008--so unprofessional as this piece in Vox? Simon Wren-Lewis begins the needed labor of Hercules here:
...[had] government deficits [that] were too high, and... economies [that] had become uncompetitive.... The deficits needed to be reduced. Under flexible exchange rates this could have been done with relatively little cost.... In a monetary union, this cannot happen, so a period of unemployment is inevitable to restore competitiveness. The key macroeconomic question is how quick adjustment should be.... Slow is much more efficient. So it makes sense for some institution like the IMF to provide loans to the government to allow it to eliminate deficits gradually.... When it came to Greece, the Eurozone made three key mistakes. 1) Too much austerity too quickly, violating the logic.... 2) There was only partial (and delayed) default on Greek government debt.... 3) Adjustment... required in an environment of Eurozone recession and deflation, caused by needless fiscal austerity in the non-periphery countries.... This Vox piece [by Lars P Feld, Christoph M Schmidt, Isabel Schnabel, Benjamin Weigert, Volker Wieland]... displays so much that is wrong with macro arguments coming out of the Eurozone at the moment... ignores the basic macro... denial of the importance of wage and price rigidities... the speed of adjustment matters, and... the article makes no attempt to address this central issue... a complete collapse in GDP, where over half of young people are unemployed... [was not] just par for the course, [but] rather than a function of the amount of austerity imposed... lenders are demanding Greece run significant primary surpluses now, and they need not make this demand. I could go on and on..."