by Allen Mattich
Wall Street Journal
February 21, 2012
Hurrah, Greece is… saved? Really?
In fact, Tuesday’s rescue deal — the one that will finally pay out the money that has been dangled in front of the Greek people since last autumn — does nothing to pull the Greek economy off its treadmill to hell.
The sad fact of the matter is that this rescue of Greece is not the end point. Whether the current deal ends up qualifying as a default or not, Greece will suffer similar further crises in future. That’s because the austerity-driven internal devaluation necessary to make the Greek economy competitive is a slow and painful process, involving semi-permanent recession. Every once in a while, Greece’s creditors will need to share the pain with Greek people.
But that’s not all. To the degree to which some pressure is lifted off Greece, other struggling euro-zone countries will, rightly, want the same terms. The Portuguese and Irish people also face similar internal devaluations and are also weighed down by millstone-sized national debts.
And what of Spain and Italy?
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