GREECE AND PROFLIGACY

http://krugman.blogs.nytimes.com/2015/06/29/the-awesome-gratuitousness-of-the-greek-crisis/?module=BlogPost-Title&version=Blog%20Main&contentCollection=Opinion&action=Click&pgtype=Blogs&region=Body

I’m not going to say told you so; but, told you so. From my vantage-point, the real tragedy here is not the loss of the Euro, although it surely will hasten the disintegration of Europe and therefore will heighten instability at a moment that cries for greater stability (see Ukraine, Syria, Kosovo, Turkey, Hungary, Serbia, etc.). The real tragedy is that the entire developed world will end up paying far more in security costs to pacify uprisings along this seam than they would ever have had to dish out propping up Greece. You say, well, “its the principle that matters. You can’t reward profligacy.” You mean the profligacy of financial institutions that, riding a wave of asset shy financial expansion, extended unrealistic credit to parties whose credit-worthiness was dubious? You mean the profligacy of financial institutions that benefited handsomely from these extensions of credit? This is not a moral lesson. It is an economic reality. And, soon, it will also be a military reality (it already is), and a human tragedy of monstrous proportions. Mark my words. I told you so.

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