Steve Keen, Professor of Economics and Head of the School of Economics, Politics and History at Kingston University, London, writing in the pro-business publication Forbes, warns that, under the extreme austerity deal the Eurogroup imposed, drafted primarily by German Finance Minister Wolfgang Schäuble, it “is simply impossible” for Greece to pay off its debts (emphasis mine):

The Troika’s document forces these measures upon Greece. These include “the broadening of the tax base to increase revenue”, “rigorous reviews of collective bargaining, industrial action and collective dismissals” and “ambitious product market reforms”. At the same time, Greece is required to aim to achieve a government surplus equivalent to 3.5% of GDP—the opposite of “spending more public money” which Schäuble rejected in his OpEd. Rather than debt reduction and rescheduling as even the IMF now calls for, “The Euro Summit acknowledges the importance of ensuring that the Greek sovereign can clear its arrears to the IMF and to the Bank of Greece and honour its debt obligations”.

This cannot in any sense be seen as an economic document, since an economic document would have to assess the feasibility of its proposals. Instead it simply states Schäuble’s ideology: regardless of your economic circumstances, simply implement these (so-called) market-oriented reforms, restore trust, and your economy will grow.

With the government debt that Greece currently labours under, this is a fantasy (Yanis Varoufakis’s annotated version of the document is well worth reading on this issue). Even if Greece were to pay a mere 3% on its debt, interest payments alone would absorb over 5% of GDP. To do that, and run a primary surplus of 3.5% of GDP in an economy where 25% of the population is unemployed is simply impossible.

So the “economic program” the Troika is imposing on Greece is bound to fail—yet if it fails, the document then requires that the level of austerity be increased, through “quasi-automatic spending cuts in case of deviations from ambitious primary surplus targets”. This is not an economic program but a punishment.

Dr. Keen characterizes Schäuble as the “Trust Troll,” and says that it “punishes you with more austerity if the original dose of austerity fails to cause growth.”

As I noted in a previous article, a secret International Monetary Fund (IMF) report obtained by Reuters admits that Greece’s debt is “unsustainable” under the austerity deal imposed by the Troika. The IMF argued there is a “need for debt relief on a scale that would need to go well beyond what has been under consideration to date” and called for a 30-year grace period on servicing Greece’s debt.

Greek debt, according to the IMF study, will likely reach 200% of Greece’s gross domestic product (GDP). The Troika’s austerity deal, the IMF forebodingly warns, “will bring about an unsustainable debt dynamic for the next several decades.”

The Eurozone finance ministers (Eurogroup) received this report from the IMF, but ignored its warnings, instead imposing conditions on Greece that they know are unsustainable.

As I wrote: “In other words, the Troika is wittingly leading Greece down a path to further crisis, and knowingly subjecting the Greek people to further suffering.”