Hannes Swoboda on the IMF Report: „It’s time for Barroso, Rehn and Merkel to apologize“

The International Monetary Fund’s (IMF) World Economic Outlook report this week has revealed that the austerity policies followed by most European governments have been based on a serious miscalculation of their impact on growth and employment. Commenting on the publication of the report, S&D Group President Hannes Swoboda, said:
„It was irresponsible of the EU institutions to base their policy advice on economic models which have proven to be highly questionable. „The consequence of their policy errors is enormous hardship, especially in those countries where EU-IMF Troikas have imposed particularly harsh policies on citizens.

„It adds insult to injury that people have lost their jobs and livelihoods and seen public services and social provision ravaged as a result of a mixture of neo-liberal ideology and faulty economics.“

He continued by stressing the continuous calls from the S&D Group to end the neo-liberal austerity policy:

„Plenty of voices, including our own, have been warning over the last three years of exactly the consequences which the IMF report now confirms. But our warnings have been rejected by the Commission and the majority of the Council.

„It is time for them to apologize and change course.

„The IMF report and its recognition of the fiscal multiplier mean that a better balance between fiscal discipline and growth is possible. We call on the Commission to recalculate its forecasts on the basis of a corrected fiscal multiplier in time for the forthcoming annual growth survey (AGS), so that the next round of policy recommendations to member states is not based on erroneous data.“

He concluded by calling for Chancellor Merkel to the start the change of direction today during her visit to Greece:

„Chancellor Angela Merkel should take the opportunity of her visit in Greece to apologize, change her approach and stop digging Europe into an even deeper hole.“