This is the most ridiculous ideas that have ever comes from FMI ! If you reduce salary, what importance is it to the economy! Except of course the govt employee, but then it will still hurt the economy, its like a way of government reducing its investments in the economy, and this will shifts the demand, which will affects supply, Shrinking both demand and supply, which will reduce still the demand for labor, increase in the long run the current prices of goods and services, forcing disequilibrium in all sectors of the econmy and in the long run will not reduce anything, but will increase inflation! What the Government and the whole Euro still do not understand is and continue to be this The division of labour makes productions on a large scale possible, bit without a credit based economy as practised in Europe! division of labour and now, mechanized and automatic division of labor will be obsolete if theres no enough credits to absorbs whats being produced, Except if europe wants to stop its mass produced goods,then Eirope can redefined another economic theories, but even that have its long term cost! Compare it to God trying to get the Israelites to the Promised land, God had other cost as feeding the jews with mana(free food) cover the jews with clouds, provide waters etc( free amenities) if not God will not get the People to the promised land, Will Europe leads its citizena to the promised land in peace and alive to get to the land?
Posted on: Wed, 07 Aug 2013 15:43:04 +0000
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