The Economics Peter Bofinger
Peter Bofinger, the prominent economic adviser to the German government, in a interview to the «Frankfurter Rundschau» paper sharply criticized the IMF-ECB austerity program that was implemented to debt ridden Greece, stating that “The continuing plight of the Greek economy is a result of the austerity measures dictated by the "troika", adding: "With the cuts, the economy has stalled, so the deficits rose, after which the troika demanded even harsher austerity measures." In this vicious cycle the system collapses. "The troika has violated basic laws of economic gravity."
It must be noted though that back in 2010 he appeared rather consistent with the austerity measures, as he told to Spiegel magazine that a tough reaction from Brussels would serve as a paradigm to the rest of the PIIGS:
“SPIEGEL: The European Commission has prescribed a strict program of austerity measure for Greece. The government in Athens needs to cut its budget deficit by 75 percent by 2012, and EU aid is not planned. But it is unclear whether Greece will be able to steer its way out of trouble on its own. Is Brussels risking a state bankruptcy?”Well, as Menander have said (Γνῶμαι 185)": “ When the oak falls, everyone cuts wood”
Peter Bofinger: “The tough stance against Greece is the only correct approach. A cash injection from Brussels would have set a dangerous precedent -- it would have signaled to other problem countries like Portugal or Spain that when the going gets tough, the European Union will rescue them”.
