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‘Greece needs a structured default’

The Greek parliament has approved a new and unpopular property tax as people continue to protest in the streets. Many in Greece now realize they would be better off defaulting, Godfrey Bloom, a British Euro MP for the UK Independence Party told RT.

­The new property tax, which came after more than a year of spending cuts and tax hikes, has left the Greeks outraged. And as Bloom said, it will not help the country’s economy.

“You cannot tax your way out of recession or depression. It is simply not possible. Trying to tax your way out of a recession is like trying to lift yourself up in a bucket by the handle. The sooner the politicians face the truth of it, the sooner we can start to get out of it,” he stated.

And moreover, the Greek people are beginning to realize they no longer want to be saved from defaulting, explained Bloom.

“The EU, the Eurozone and the IMF need to help them in a stable, controlled default. Greece should default in the same way Argentina did in 2002, only without a complete collapse. We need a structured default,” he added.

The European Commission President has called for closer ties within the EU as a way out of the current crisis – which is essentially a call for more power to the commission. According to Bloom, this whole project is about tightening and centralizing control.

“This is a very Soviet style of government. The commission is not an elected body, it is unelected bureaucrats. If you are going to centralize fiscal policy it has to have some sort of political legitimacy. The Greek people do not want to be a member of it; it has no political legitimacy at all! This has nothing to do with the people,” he maintained.

­‘Greeks are monetarily imprisoned in euro’

­Dr. Markus Kerber, professor of political economy, says Greece and other bailout countries should be given an opportunity to leave the eurozone.

“The fundamental problem of Greece and the eurozone is divergence of competitiveness,” he told RT. “There are northern countries being relatively competitive, with large trade surpluses, and other ones like Greece, Portugal and, not to forget, Spain. I would not mention Italy in the same context. By putting more debt and more bailout money to these countries you don’t increase the competitiveness of these countries. On the contrary, you keep them in the same monetary costume. They are monetarily imprisoned in the euro after having consumed the sweet poison of Europe’s cheap money for more than 10 years. Unless you give them the freedom to leave the eurozone, they will not be able to catch up with other competitive countries.”