Second Look: Greece May Be Recovering, But Only Barely

| Thu Apr. 10, 2014 9:16 AM EDT

Yesterday I linked to a Hugo Dixon column arguing that Greece is, improbably, starting to recover. Ryan Cooper points to Greece's stubbornly high unemployment rate and begs to differ:

With unemployment still over 27 percent, I'd say let's hold off on talk of a recovery.

Indeed, I rather fear this could be the worst of all worlds. Moving off the Euro would have been awful, but at least held the prospect of returning to growth and full employment within a couple years (from a much lower base). By contrast, the bank Natixis recently estimated that, given very generous assumptions, it will take Spain (which is in similarly dire straits) 25 years to return to 2007-era employment. A nation can do a great deal of catch-up growth in that time.

Realistically, I'd guess this means that Spain, Greece, Italy, Portugal, Ireland, etc., will never recover fully, and instead we're witnessing the birth of a crummy, tattered Franco-German empire with a permanently depressed periphery.

Fair enough. I think it's worth pointing toward signs of progress, but it's certainly true that the eurozone's can-kicking response to its financial crisis has had the effect of enormously protracting the misery of the mostly southern debtor countries. Recovery may be starting, but even if it is, it's going to be a very, very long time before Greece is actually in anything approaching decent shape.