After another report, this time by the IMF's Independent Evaluation Office (IEO), exposing IMF's lethal "mistakes" who led to the destruction of national economies, it was confirmed that "technical expertise" of the Fund not only used by the European Financial Dictatorship officials to save their currency and banks, but also to finish the Greek experiment in order to expand it throughout eurozone.
From Telegraph :
The International Monetary Fund’s top staff misled their own board, made a series of calamitous misjudgments in Greece, became euphoric cheerleaders for the euro project, ignored warning signs of impending crisis, and collectively failed to grasp an elemental concept of currency theory.
This is the lacerating verdict of the IMF’s top watchdog on the fund’s tangled political role in the eurozone debt crisis, the most damaging episode in the history of the Bretton Woods institutions.
The report by the IMF’s Independent Evaluation Office (IEO) goes above the head of the managing director, Christine Lagarde. It answers solely to the board of executive directors, and those from Asia and Latin America are clearly incensed at the way European Union insiders used the fund to rescue their own rich currency union and banking system.
The report said the whole approach to the eurozone was characterised by “groupthink” and intellectual capture. They had no fall-back plans on how to tackle a systemic crisis in the eurozone – or how to deal with the politics of a multinational currency union – because they had ruled out any possibility that it could happen.
The IMF persistently played down the risks posed by ballooning current account deficits and the flood of capital pouring into the eurozone periphery, and neglected the danger of a "sudden stop" in capital flows.
While the fund’s actions were understandable in the white heat of the crisis, the harsh truth is that the bailout sacrificed Greece in a “holding action” to save the euro and north European banks. Greece endured the traditional IMF shock of austerity, without the offsetting IMF cure of debt relief and devaluation to restore viability.
A sub-report on the Greek saga said the country was forced to go through a staggering squeeze, equal to 11pc of GDP over the first three years. This set off a self-feeding downward spiral. The worse it became, the more Greece was forced to cut – what ex-finance minister Yanis Varoufakis called "fiscal water-boarding".
The IMF thought the fiscal multiplier was 0.5 when it may in reality have been five times as high, given the fragility of the Greek system. The result is that nominal GDP ended 25pc lower than the IMF’s projections, and unemployment soared to 25pc instead of 15pc as expected.
The injustice is that the cost of the bailouts was switched to ordinary Greek citizens – the least able to support the burden – and it was never acknowledged that the true motive of EU-IMF Troika policy was to protect monetary union. Indeed, the Greeks were repeatedly blamed for failures that stemmed from the policy itself. This unfairness – the root of so much bitterness in Greece – is finally recognised in the report.
On the occasion of this new report which puts the final nail to the coffin of the IMF reliability, Greece's former Minister of Finance, Yanis Varoufakis, unleashed a fierce attack against the EFD/IMF mafia on twitter:
The IMF's Evaluation Office acknowledges "what ex-finance minister Yanis Varoufakis called fiscal water-boarding" https://t.co/SftT4j2oWm— Yanis Varoufakis (@yanisvaroufakis) July 28, 2016
Time to demand the immediate firing of Poul Thomsen. No ifs. No buts. Exit stage left. https://t.co/SftT4j2oWm— Yanis Varoufakis (@yanisvaroufakis) July 28, 2016
The IMF confesses it immolated Greece on behalf of the Eurogroup https://t.co/CoK0IM3vZC— Yanis Varoufakis (@yanisvaroufakis) July 29, 2016
TIME FOR RESIGNATIONS AT THE IMF, ECB & COMMISSION https://t.co/CoK0IM3vZC (Beginning with P. Thomsen, T. Wieser, D. Costello, K. Masuch)— Yanis Varoufakis (@yanisvaroufakis) July 29, 2016
TIME FOR AN APOLOGY TO THE PEOPLE OF GREECE https://t.co/CoK0IM3vZC— Yanis Varoufakis (@yanisvaroufakis) July 29, 2016
TIME FOR A POLICY U-TURN, BEGINNING WITH IMMEDIATE DEBT RELIEF, THE END OF AUSTERITY & THE CESSATION OF FIRE SALES https://t.co/CoK0IM3vZC— Yanis Varoufakis (@yanisvaroufakis) July 29, 2016
Recall that Varoufakis was one "barrier" that had to be removed according to the EFD officials. As Paul Mason wrote already since May 2015:
“In the script according to the eurozone, the expected ending is: Syriza splits; finance minister Varoufakis makes good his pledge not to sign a surrender and resigns. A government of the centre-left forms, with Alexis Tsipras now allied to the centrist Potami party and with tacit support from a liberal wing of the New Democracy party. Debt relief happens, but on the terms dictated by the lenders, and Syriza survives to complete its mutation into a centre-left social democratic party.”
Also, the Greek opposition proposed recently an Examination Committee to investigate the causes behind the introduction of capital controls in the summer of 2015, the third bailout agreement and the need for a new bank recapitalization: “New Democracy’s proposal calls for the formation of an Examination Committee to investigate the causes behind the introduction of capital controls in the summer of 2015, the third bailout agreement and the need for a new bank recapitalization. According to a report in major Greek newspaper Ta Nea, the main opposition party will also call for an investigation of “Plan X” that former Minister of Finance Yanis Varoufakis composed, should Greece had been forced out of the euro zone, and Mr. Galbraith revealed in a book recently.”
Meaning that the Greek opposition, completely devoted to Troika's neoliberal policies, wanted to "crucify" Varoufakis because he tried to build an emergency plan in case that Greece's creditors would put the country in the corner as they eventually did through the financial coup in summer 2015!
Of course, the opposition miraculously "erased" all the previous years since 2010, marking the most devastating period for the Greek economy under the New Democracy - PASOK coalition government that implemented the IMF policies of destruction. It didn't bother, as expected, to request an Examination Committee for that period.
IMF new tactics: It is better to appear unreliable than to let people understand that you serve specific interests