Danni Rodrik sometimes tries to read more into a economic situation than can be found. He suggests that the Greek crisis was generated through an innate discontinuity between economic policy and Democracy. There is no inconsistency mandatory between economic policy and Democracy, only mal-approach to legislation of the economic policy. There will always be economic disaster when the wrong applications are applied, whether under Democracy or Authoritarianism. Both Democrats and Soviets have intrinsic difficulty with misapplied economic policy. Globalization has much different connotations, though, all concerned with Too Big to Succeed. Economic policies must be sculpted to meet the needs of populations, and One can doubt if there is an economic policy with enough latitude to be applied everywhere.
Here is a Piece which expresses the very real economic situation existent under economic stress. The World business model which pares labor down to the bare essentials finds a labor shortage during recessions. The rationale will likely be that the worries of employment lead labor to take whatever Jobs can be obtained, and Skilled Labor is absorbed quickly by the general labor market because of greater Skill levels; all to simply gain employment, rather than wait for doubtful Specialty Jobs. Lesser Skilled Labor finds greater Unemployment, while Skilled Labor find themselves working at substandard labor given their Skill; all the while Businesses are searching for the skilled performance they need. It could be that Business has made a mistake in not recruiting long-term labor complements.
The Reader might ask How the Two mentioned above can be related. I will simply state that there is singular disparity between the needs of macroeconomics and microeconomics–a factor of far greater significance that the existence of Democracy or Authoritarian operation. Economic policy must be the reconciliation between Business, Labor, and Consumers. The needs of None can be ignored safely, and breeding false economic information can be dangerous–leading to the various Crises, all due to individuals trying to hide their faults. There is only a quantitative difference between a Madoff, and a AIG. There is only an Opportunity Gain between Germany and Greece. It is not a question about the existence of Democracy. It is not a question about the error of economic policy. It is all a question about intemperance of political leadership promising more economic benefit than can be allocated, then blaming Voter reaction. The Globalization issue goes beyond this scope, and One can wonder if anything truly exists in this netherworld, as all interaction must occur in much vaunted Trade treaties which no one understands; whose by-product is always disturbed by misinterpretation by all Parties–like the debt standards applied between Greece and the rest of the EU, minus Portugal, Spain, Italy, and actually France as well. lgl