Ten Years Ago: European Debt Crisis

Jun 26, 2021

“We live in very difficult times, and what happened ten years ago is a key part of that story…”
To mark Economic Update’s 10th anniversary year, Professor Wolff is revisiting relevant moments from 10 years ago to explore how capitalism, its defenders, and its critics have all changed.
For the month of June, Prof Wolff takes a look at the European debt crisis and a critical lesson it teaches us: Accumulating debt was not and is not a solution.
“[Germany and France] gathered public money, taxpayer money, central bank money, and lent it to Greece and the rest of the debtors on condition that they would use the public money to pay off their private creditors: those big French and German and British banks, which they did. That left these countries with enormous unpaid debts only now they were debts to the public authorities of Europe rather than to the private banks… Nowadays we see also the rapid accumulation of debt, like we did in the years leading up to the crash of 2008, 2009, and 2010.”