June 19, 2015
The NYT decided to survey what people in the other crisis countries think about the situation in Greece. The general theme appears to be that we toughed it out, now Greece should too. It would have been useful to include a bit of data on where these countries stand now. Per capita income and employment are all well below their pre-crisis level in all four countries mentioned.
This table compares the I.M.F.’s projections for per capita GDP and employment in 2015 with the 2007 level in each of the four countries. The last column shows the equivalent employment loss in the United States. For example, the employment loss in Ireland since the start of the crisis would be equivalent to losing 13.35 million jobs in the United States. The loss in Spain would be equivalent to losing 21.0 million jobs.
|
Gap from 2007 Level |
|||
|
|
Per capita GDP |
Employment |
U.S. equivalent |
|
Ireland |
-4.40% |
-8.90% |
-13.35M |
|
Italy |
-11.50% |
-3.10% |
-4.65M |
|
Portugal |
-4.60% |
-11.50% |
-16.7M |
|
Spain |
-5.10% |
-14% |
-21.0M |
Source: I.M.F.
This should give readers a better sense of the success to date of the austerity policies being promoted by the European Union and I.M.F.
The piece also wrongly asserts that Italy did not have austerity. This is not true. It went from having a structural budget deficit of 4.2 percent of GDP in 2009 to 0.3 percent in 2015. This would be equivalent to a reduction in the size of the annual deficit of roughly $700 billion in the U.S. economy. That is less of a reduction than in the other countries, but still a substantial amount of deficit reduction in a country experiencing a recession.
Note: The U.S. equivalent for the number of jobs lost in Ireland has been corrected in the text.
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