What Hazlitt Would Have Thought About Greece

The Greek parliament is now debating an austerity and privatization program that the troika made up of the EU, ECB, and IMF is demanding in exchange for a second bailout. Outside the Greek parliament in Syntagma Square, the protests will surely continue, as will a two day general strike by public sector trade unions.

In his Man vs. the Welfare State, Henry Hazlitt (an Austrian minded American journalist best known for authoring Economics in One Lesson) described similar dissent that destabilized Uruguay when extravagant government spending there led to a fiscal crisis in the mid-1950′s.  Hazlitt then commented:

... it illustrates what is perhaps the most ominous
aspect of the welfare state everywhere. This is that
once a subsidy, pension, or benefit payment is extended
to any group, it is immediately regarded as a
“right.” No matter what the crisis facing the budget or
the currency, it becomes “politically impossible” to discontinue
or reduce it.

Alongside Uruguay 1956, Hazlitt would undoubtedly, and rightly, include Greece 2011 to illustrate how the social democratic welfare state grossly inflates moral expectations.

One Response to “What Hazlitt Would Have Thought About Greece”

  1. mstob says:

    The Greek people are right to be protesting. They are getting thrown into debt serfdom.

    The thing about "austerity" is that it is no such thing. Sure it may be austerity for tax payers (the people who generally have the least say in public finance and how tax dollars are spent) but for the state it is a means of increasing its own ability to spend. Isn't it curious that Greece has to pass "austerity" measures in order to receive loans that it will result in the Greek government spending more money?

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