Greece and the European Union may have temporarily staved off disaster but many worry that austerity will impose considerable short-term pain on Greek citizens and further depress the country’s struggling economy.
What can America learn from this?
At first glance, liberals and conservatives seem to draw opposite lessons. The left sees the Greek disaster as evidence that austerity and belt-tightening are unfair and painful. Meanwhile, the right sees the disaster as a lesson in the need for fiscal restraint and the dangers of big deficits.
Both arguments get something right. Blunt austerity is disastrous for the most vulnerable. Suicides have spiked in Greece since the financial crisis as unemployment rates have surged upward.
But this terrible austerity is the inevitable outcome of runaway spending, fueled by an ever-growing desire to expand the social safety net across the entire Greek society.
So what is the takeaway lesson for the United States? If social safety net programs metastasize into expansive middle class entitlements, the genuine poor get left behind when it comes time to pay the bill.
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