It's about time. Greece has been behaving like a gambling addict, asking for money to repay the old debts only to waste them in expensive restaurants, buying iPhones, and gambling even more.
You have a limited understanding of the situation. And you don't need to be that insulting toward Greece.
I know here it is apparently ok to make fun of people in a dare situation and talk about them like they are fool and idiots yet in that case the responsibility is shared across many parties and the EU itself has a huge responsibility in that fiasco.
What the point saying what you just said? does it make you feel smarter or like you belong to a superior class? Would you want others to talk about you or your country that way when things turn south? no, so have a little respect. We are talking about people here who are mostly victims. Or do you think people here will laught at your speech because that's what they do in real life when you say horrible things?
Greece is not a person, Greece is a nation state. It has implemented severe fiscal cutbacks after being forced to by its creditors. Cutbacks which have ruined the country's economy, massively increased poverty, and made it more difficult to pay back its debts.
Now its people have voted in a government that wishes to make different reforms. Ones that also keep the book balanced, but do not hurt the weakest in society as much or destroy economic productivity.
The Greeks are not lazy. Suffering is not lazy.
So I guess the question is who should be paying for Greece's poor financial planning because Greece do not appear to think it should be them.
http://www.economist.com/blogs/charlemagne/2010/02/greeces_g...
We should bail them out, but they should also retire at 67, the (existing) final salary pensions should be cut back and they should start paying their taxes.
EU data: Greece 64.4 years, Germany: 65.1.
OECD data: Greece 61.9 years vs. Germany 62.1
So it is actually the same.
I don't agree with much of the fiscal and financial structures, strategies and ethos of the world at the moment however this is the path we are on and pivoting out of it will cause huge disruption and suffering. Austerity and measures forced by her creditors have so far failed Greece. It doesn't look bright in the future so they are correct to question the strategy however if they don't get their own house in order it will all be in vain. I think they realise this.
[0] Actually, here is some data for the EU (German): https://upload.wikimedia.org/wikipedia/commons/1/1b/Nettozah...
[1] And here is more: https://en.wikipedia.org/wiki/Budget_of_the_European_Union#N...
This entire mess started with Greece not having its finances in order, and essentially lying about this for years to the rest of the Eurogroup. After it became clear how dire the situation was, the Eurogroup stepped in and helped Greece by giving them money (LOTS of money). Had the Eurogroup not done this, Greece would have defaulted on its debts years ago, and the country would have gone bankrupt.
Now if someone offers to help you by giving you money, provided you meet certain conditions, you can either accept and comply with the conditions, or you can refuse. The fact is that Greece gladly accepted the billions upon billions of euros, and the conditions that money came with.
I am fully aware that the measures demanded by Greece's creditors are tough. Some would say it is doubtful whether they are actually effective at all. And the demanded measures are certainly driven partly by political motives. All this is true.
But it is mind-boggling to me that after the Eurogroup provided several hundred billion euro's in aid to Greece, anyone would turn around and claim the current crisis is in no way the Greeks' own fault.
Nobody is denying that fact. But it seems you are forgetting that Greece made a lot of tough decisions for its people when asked by its creditors to "reform" yet it is just not sustainable, it's like asking the greeks to commit suicide.
> and essentially lying about this for years to the rest of the Eurogroup
And who do you think helped cook the books? Goldman Sachs
If a country gets out of the Euro, it will set a precedent and other countries might do that in the future. The euro is an insane experiment anyway. It cannot work. Too many structural and economical differences between euro countries. UK was smart enough not to get into that mess. It seems that the only country really profiting from this is Germany. While they are obviously not responsible for that mess , there is a lot of resentment against Germany in southern European countries and France. For these countries the Euro is just the Deutsche Mark 2.0.
No, I am not forgetting this. The Greek people are certainly suffering from the reforms. But this suffering would have happened anyway, with or without the Euro.
Greece has made such a mess of its finances, in a number of ways, that even if it had never joined the Euro, it would have gone bankrupt at some point anyway.
> The euro is an insane experiment anyway. It cannot work. Too many structural and economical differences between euro countries.
Perhaps, but I hope you're wrong :).
> It seems that the only country really profiting from this is Germany.
There is free trade between all EU countries, not just the Euro countries. It is this free trade that Germany is profiting from, not the Euro currency.
Once again a blatant falsehood.
When economically strong and weaker countries share a currency the stronger countries benefit, because it pushes the value of their currency down. This means they can export effectively, especially to the countries who suddenly have a stronger currency with more purchasing power than they otherwise would have had.
Does this mean Greece (let's stick to them) was predetermined to get hit the moment they joined the Eurozone?
If yes, could you please elaborate how that wasn't visible to them? Or, if it was, what motivated them to take this road anyway?
I can only speculate about what motivated Greece to join the Eurozone.
My guess would be that Simitis' believed his reforms (Eksynchronismos) fundamentally transformed the Greek economy. Politicians take bold action to ensure their legacy, and it must be tempting to go down in history as the man who fixed his country's economy and led it down a road of mutual prosperity.
Perhaps he understood the economic risks, perhaps he didn't. He was certainly warned by economists. Perhaps he simply didn't believe the rest of the Eurozone could be this obstinate and cruel. It's hard to say for sure. We certainly can't take the politicians' words at face value.
Did GS get any "punishment" for this? And does this take away all guilt from Greece?
> The euro is an insane experiment anyway. It cannot work. Too many structural and economical differences between euro countries.
As someone without an economics background, I'm interested to know what these insurmountable differences are?
I guess the punishment is that former GS executive Mario Draghi now runs the ECB.
To what extent is any one person responsible for the actions of their government?
- The EU was aware that Greece's finances were not as portrayed. This was an open secret. However, Germany and France were breaking max deficit rules at the time, and they would look like huge hypocrites if they complained about Greece's numbers. So they didn't. Rose colored glasses and political expedience played a huge role here.
- A country can't go bankrupt. They can simply refuse to pay their debts, and because they're a sovereign nation they're in their right to do so.
- When banks lend money to a country it isn't charity. They get interest payments and in exchange risk not getting paid back at all if things go sour. It was astoundingly unwise for banks to lend money to Greece at practically zero interest (as they did during the boom period). Had the banks been responsible, or had the oversight institutions not been asleep at the wheel, this crisis would not have happened.
- The banks who lent to Greece got 90% of the bailout package. Not the people of Greece. So it's not true Greece received "several hundred billion in aid".
- "Some would say it is doubtful whether they are actually effective at all.". It's certain beyond a shadow of a doubt that the austerity policies enforced by the troika were actively harmful. It's delusional to pretend otherwise, given that the GDP shrank so much the debt burden INCREASED as a result.
> When banks lend money to a country this isn't charity.
> They get interest payments and in exchange risk not
> getting paid back at all if things go sour
> The banks who lent to Greece got 90% of the bailout
> package. Not the people of Greece. So it's not true
> Greece received "several hundred billion in aid"
If Greece was a person, they'd have gone through bankruptcy and been discharged by now, and the banks who'd imprudently lent to them would have taken a haircut.
It frigthens me to think such a line of reasonning could pop up on security or war matters.
It is about pensioners and state employees.
There is, however, deep structural or cultural issues that causes Greece to have such a massive tax gap: http://www.imf.org/external/pubs/ft/scr/2013/cr13155.pdf.
People may well be working hard, but a significant enough number of people are not contributing enough to the state, yet are demanding (by voting) ever more from it, and leaders seemed to have always been relaxed about it (I can't find the source again, but I remember reading that there is even a significant tax cap in the civil service itself).
No, instead of cutting that, they should squeeze even more money on taxes. Even EC is criticizing Greek government for collecting too much money on income tax and VAT.
Just for illustration VAT tax on heating oil is 60%, most houses I know just do not order it. Last winter had a few weeks bellow freezing.