Anti-austerity 'No' voters celebrate the results of the first exit polls in front of the Greek parliament in Syntagma Square in Athens, Greece on July 5, 2015.
Photo by Yannis Behrakis/Reuters

The United States will not ‘be the next Greece’

For much of President Obama’s first term, Republicans had an unfortunate habit of telling Americans that the United States was poised to become Greece. The European country with a small economy was racked with a debt crisis – yes, this problem has been ongoing for quite a while – and for GOP officials, it became a convenient excuse to call for U.S. austerity measures.
 
The Republican rhetoric was repeatedly discredited and ultimately ignored. After President Obama was re-elected and the White House shaved $1 trillion off the deficit, the same GOP voices who were wrong about the U.S. becoming Greece moved on to being wrong about other things.
 
Unfortunately, however, with the Greek crisis intensifying, the debunked argument is back. Here was Louisiana Gov. Bobby Jindal (R) on Fox News this week:
“Look, Greece is going to be – the United States could be the next Greece, if we’re not careful. We are spending too much – $18 trillion in debt – more taxes, more regulations, no plan to pay it back. The Greeks gave us democracy, and now they’re showing us how to kill democracy. […]
 
“If we don’t reform our entitlement programs, if we don’t shrink the size of government, if we don’t cut back the EPA, if we don’t cut back taxes, that’s going to be us.”
Practically all of this is gibberish, though as Media Matters noted, the longshot presidential candidate isn’t the only one pushing the bogus line. Fox’s Bill O’Reilly said a Greek-like crisis “could happen to the United States” in about 10 years, to which John Stossel replied, “Absolutely, we’re on track for that.”
 
No, we’re not.
 
All of these arguments were wrong the first time Republicans started making them, and they have not improved with age. In his latest New York Times column, Paul Krugman once again tries to set the record straight.
[T]he “We’re Greece!” crowd has a truly remarkable track record when it comes to economic forecasting: They’ve been wrong about everything, year after year, but refuse to learn from their mistakes. The people now saying that Greece offers an object lesson in the dangers of government debt, and that America is headed down the same road, are the same people who predicted soaring interest rates and runaway inflation in 2010; then, when it didn’t happen, they predicted soaring rates and runaway inflation in 2011; then, well, you get the picture.
 
…[T]he story you’ve heard about Greece – that it borrowed too much, and its excessive debt led to the current crisis – is seriously incomplete. Greece did indeed run up too much debt (with a lot of help from irresponsible lenders). But its debt, while high, wasn’t that high by historical standards. What turned Greek debt troubles into catastrophe was Greece’s inability, thanks to the euro, to do what countries with large debts usually do: impose fiscal austerity, yes, but offset it with easy money.
I can appreciate the overly simplistic appeal of the Republican argument: Greece carries a large debt; Greece is facing a brutal crisis; ergo, countries with large debts face brutal crises.
 
The problem, of course, is this overlooks every relevant detail.
 
My suspicion is that many on the right aren’t as foolish as they appear. Some conservatives very likely know that there is no similarity between the United States and Greece, but they’re pushing the foolish talking point anyway because it advances a broader ideological goal – if Americans can be made to believe we’re on our way to becoming Greece, maybe the public will go along with plans to slash public investments and dismantle social-insurance programs.
 
Indeed, look at the Jindal quote again – the far-right governor seemed to suggest cutting back the EPA is somehow related to avoiding a Greek-like fate.
 
But whether it’s foolish or dishonest, the posture is absurd either way. Anyone throwing around such rhetoric deserves to be ignored.
 

Bobby Jindal, Debt and Greece

The United States will not 'be the next Greece'