Comments on: Drastic Economic Measures

By: dimitris

dimitris — Tue, 09 Feb 2010 12:00:21 +0000

This is the most moronic article you have written inthis blog and particularly the last part “If I was Greek…”. If Greece left the euro, the next day the markets would lead Greece to bankruptcy. But ofcourse you are so eurosceptic that you can’t see anything beyond that.

By: Panaiotis

Panaiotis — Fri, 05 Feb 2010 22:42:08 +0000

I live in Greece. One of the people who commented mentioned that Greek citizens have done nothing to deserve what is happening to the economy. This is half true. The governments lack of responsible fiscal policies have created part of the problem, the other part is the standard of living here. In no other country do people make so little and consume so much. The majority of the country is driving around in Mercedes & Porche, taking exotic vacations, spending lavishly on everything you can imagine. And this fairy tale life has been going on for years. Behind everything there are credit cards and loans, smoke & mirrors. Fairy tale is over, reality is coming !

By: Ralph Musgrave

Ralph Musgrave — Thu, 04 Feb 2010 12:55:47 +0000

Two provocative items in the Financial Times on Greece. The first is a letter saying that Greek civil servants are a bunch of layabouts. The second proposes that Greece resurrects its own currency to run alongside the Euro.

http://www.ft.com/cms/s/0/c264ddd2-1145-11df-a6d6-00144feab49a.html

http://www.ft.com/cms/s/0/5ef30d32-0925-11df-ba88-00144feabdc0.html?ftcamp=rss

By: Michael Roberts

Michael Roberts — Wed, 03 Feb 2010 16:07:51 +0000

Who is paying for capitalism’s worst financial crisis and slump since the Great Depression? The bill for these losses is now being presented to people through increased taxes, reduced public services and rising job losses, whether it is in the large G7 countries like US or the UK, or the smaller capitalist economies like Iceland, Greece or Latvia .

The people of Iceland were told by their new ’socialist’ government that they would have to pay back about €4 billion (almost 50% of Iceland’s 2009 GDP) to the British and Dutch governments that Iceland’s rapacious banks had lost through investing abroad and betting in credit markets. This would mean a vastly increased tax burden lasting for the next ten years. No wonder Iceland’s small population rebelled and demanded a referendum to reject the deal that the government made on their behalf. On 6 March, Icelanders will tell their government where to stick the agreement.

The Greek people also face a disastrous situation. Ironically, Greek banks did not get into very serious trouble like the British, Dutch or Icelandic ones did. But because the financial crisis spread across the globe and the Great Recession that followed was so deep and pervasive, Europe’s financial institutions are no longer willing to finance Greek public services, something the European Union has done for more than a decade because Greek capitalism itself is so weak and unproductive that it could not do it alone.

Successive Greek governments have tried to avoid slashing public sector jobs and wages because they feared the backlash from Greeks trying to preserve their living conditions. But now the jig is up. The centre-right Greek government was heavily defeated in a recent general election and the ’socialist’ PASOK government came into office, only to find that the public sector now ran an annual deficit of spending over income of 15% of GDP and an outstanding debt of over 130% of GDP. In effect, the government was bust.

The other EU governments, led by the conservative German government, are now saying the Greeks will receive no more gifts. Instead, they must make huge cuts in public spending, raise taxes, sack employees, cut wages and raise the pensionable age. In effect, they are demanding that Greek families take a 25% cut in their living standards over the next five years.

This is a countdown to the devil for Greeks. The Greek people have done nothing to deserve this and yet they must pay heavily for the failure of capitalism.