Former EU leaders back ‘New Deal’ for Greece

Several former European leaders have proposed a US-style ?New Deal? plan for debt-ridden Greece, based on a plan co-drafted by Greek economist and blogger Yannis Varoufakis.

The appeal, printed in the Financial Times and the Spiegel magazine on Monday, called for policies to encourage fresh investment instead of spending cuts.

The declaration, signed by former premiers Guy Verhofstadt of Belgium, Giuliano Amato of Italy, and Michel Rocard of France, as well as by ex Portuguese president Jorge Sampaio, said ?a conversion of a share of national debt to EU bonds would stabilise the current crisis.?

?Net issues of bonds by the Union would mean inflows of funds to finance European recovery rather than austerity,? the declaration said.

Varoufakis, a political economist at the University of Athens, penned the blueprint together with Stuart Holland, a Europe expert and former high-ranking official in Britain?s Labor Party.

The document criticizes Europe?s alleged democratic deficit, saying it is largely responsible for inability to grapple with the eurozone?s burgeoning crisis.

?Europe is losing a war between elected governments and unelected rating agencies. Governments are trying to govern but rating agencies rule,? the statement said.