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Home Publications Blogs Beat the Press Germans Hold Incoherent Views On Greece and Southern Europe

Germans Hold Incoherent Views On Greece and Southern Europe

Wednesday, 09 May 2012 04:43

It would have been useful to include this fact in an article on how Germans are losing patience with Greece. Germany has been anxious to build up and preserve its export market in southern Europe. However if Germany wants to have an export surplus with these countries, as it does, then it must lend them money. There is no logical way around this.

For this reason, it is absurd that Germans are both upset about the borrowing by Greece and other peripheral countries, but yet refuse to take the steps (most importantly higher domestic inflation) that would allow these countries to regain competitiveness. The Germans are acting like little children who both want to have their cake and eat it too, and then get mad at everyone else because they won't make it possible. 

If Germany wants to keep the euro zone intact, with its current low inflation obsession, then Germans will have to give money to the peripheral countries to buy their stuff. There is no way around this. The Germans' complaints are against logic, not their southern neighbors. 

Comments (29)Add Comment
written by dick c, May 09, 2012 7:50
I read yesterday that Greece's tourism could be down about 12% this year, mostly due to a drop off in travel from Germany. Why? I can see the Greeks cutting back on travel, but why the Germans? Is it economic, cyclical, or is German media simply painting Greece as undesirable?
There is Another Way Around
written by Paul, May 09, 2012 12:05
Instead of loaning Greece money, Germans should commit a trillion euros to buying goods and services from Greece. Consumption, as Keynes said, is the solution to this situation.
written by Peter T, May 09, 2012 2:19
dick c:
"I read yesterday that Greece's tourism could be down about 12% this year, mostly due to a drop off in travel from Germany. Why?"

1. The German economy doesn't grow as much as last year, and pessimists prefer cheaper vacations.
2. The picture of rioters and political chaos in the capital is not conducive for more tourists to visit, as calm and tranquil the final destination may be.
written by burt, May 09, 2012 5:01
It's too late for all this. Note that the newly strong left wing parties are calling for the reversal of all labor market reforms.
Greece will almost certainly leave the Euro and fully default. The question is whether the Germans will be willing to financed Spain and Italy.
written by Heinz, May 09, 2012 5:59
As for tourism:
- For Germans, it is a lot cheaper to go to Turkey for a vacation than to Greece.
- It may be that Germans do not feel exactly welcome in Greece anymore.

Overall: I am quite sure that exports to Greece account for less than 1% of German exports. From that perspective, Greece does not matter
written by Joe, May 10, 2012 5:20
The Germans should pay to help Greece. The research in to Greece's debt crisis has shown that WW2 and German occupation is a major reason for Greece's financial woes. Also, the USA should aid as well. Greece did not receive the type of financial assistance that the German's did from the Marshal Plan for rebuilding Europe after WW2.
Let the Greeks starve., Low-rated comment [Show]
Lies for the ignorant
written by Phil0, May 13, 2012 8:35
"and they need to stop expecting to retire 15 years earlier than everyone else in the EU courtesy of taxpayers in other EU countries."
Unfortunately, you are reproducing shameless propaganda; I think, this video was made for people like you, ignorant in their judgmental craving, to say the least: http://www.youtube.com/watch?v=EiMqH0V46FU
Watch closely, these are the official numbers.

It's simple: Despite the fact that the policies of the Troika and "C"DU have made Greece lose one fifth of its GDP in the years under the IMF and made unempoyment rise (officially) to 22% and youth unmployment to 40%, they still want Greeks to kill their neighbours and commit suicide at the same time by continuing on the same track.

If Germany were at the same position, it' s possible that a new National Socialist would have been ruling -and this is a contemporary purely german prediction.

And, finally, honestly thanks for this extraordinary piece.
Facts for the Communist pigs and other willfully blind
written by will, May 14, 2012 3:31
The plain and blunt facts of the matter are that Greeks have spent years subsisting on other countries' generosity while refusing to take the steps necessary to make the economy internationally competitve. They refuse to close money-losing companies, they employ far too many overpaid underworked lazy good-for-nothing civil servants (hired purely for political patronage, not because they were ever needed - they're not), they refuse to pay taxes. Theyd emand all of the benefits of a First World economy while refusing to pay for any of it.

Here are the Facts Of Life, as people all over the world understand them and as Greeks need to learn them:

1) You ARE NOT "guaranteed" or "entitled to" a job.

2) You ARE NOT "guaranteed" or "entitled to" an income.

3) You ARE NOT "guaranted" or "entitled to" any minimum standard of living whatsoever. You can work or you can starve, and either alternative is acceptable.

4) The job of government is to get the Hell out of the way and do as little as possible to interfere with the private sector which is the actual generator of wealth. Only the private sector can generate and create wealth and jobs. Government has never created one thin dime of wealth, it exists only to provide essential services, nothing more.

5) It is time for Greeks to be made to understand once and for all that if you want OUR MONEY, then you will do WHAT WE WANT and you will do WHAT WE SAY. Them that has the gold makes thre rules. You are bankrupt and in no position to make 'demands' of anybody at all. The rest of Europe and the rest of the world do not "owe" you anything at all.





It's going to be fun watching Greece collapse financially in the next few months - it will be a valuable and instructive lesson to the world on what happens when you start to wrongly believe that you are somehow "owed" or "entitled" to a standard of living which you have not earned, at other peoples expense, and what finally happens when you run out of the 'Opium' (OPM) of Delusion, i.e. OTHER PEOPLES' MONEY.

Have fun carrying wheelbarrows full of worthless drachmas to the supermarket to try to buy a gallon of milk. You're about to be thrown out of the Eurozone. I suggest that you lay off smoking crack, because if you are seriously delusional enough to think Europe somehow can't live without you then you're clearly using illegal drugs and not "sharing". Europe will do just fine without you, you are the ones who will be bankrupt and begging for handouts from the rest of the world and in vain.
Your Euro-Ponzi scheme is finally hitting the wall, you are bankrupt and we will let you fail
written by Blonde, May 14, 2012 1:16
Greece brought all of its problems on itself - it went thru no less than two rounds of bailouts so far while STILL refusing to make the substantive changes that are needed and necessary to make Greece financially solvent. Greeks live in a Communist mental fairy-tale world in which they think they can have all of the benefits of being a modern First World nation while refusing to pay for any of it.

NEWS FLASH: Here are the rules that the rest of the world understands and lives by:

* You are NOT "guaranteed" or "entitled to" a job. We'd sure like you to have a job, but getting and keeping a job is entirely your individual responsibility.

* You are NOT "guaranteed" or "entitled to" an income. It's your individual responsibility to support yourself.

* You are NOT "guaranteed" or "entitled to" any minimum standard of living whatsoever. You had an opportunity to get born - period. That's where the "guarantees" ended. Once you;re here, you're strictly on your own.

* It is NOT the "responsibility" of the taxpayers to bail you out of your problems. This is not a "European" problem, it is strictly a Greece problem.

* Nobody "needs" you to stay in the Euro. The rest of the Euro-zone countries will survive just fine after they kick you out, which is what will be happening soon.

Go ahead, call their bluff. PLEASE.

For those confused about the real causes of Greece's problems, here are some simple and straightforward explanations:



If you actually, seriously think anybody else in the world is interested in bailing out the failed welfare state that is Greece, you are probably using some very "colorful" and less-than-legal drugs and NOT "sharing".

Here's what the Chinese and Russians have to say about the idea of lending money to Greece:


Europe's labour laws and welfare systems make workers lazy, says Chinese finance chief

Read more: http://www.dailymail.co.uk/new...z1urte4T00

PRAVDA: Europe's kingdom of lazy people to be shattered again

It's time that Greeks discovered a little fact that the rest of the world already knows and understands:

If you want or ned to borrow OUR MONEY ....


The Golden Rule: We got the gold, we makes the Rules.
written by Calgacus, May 14, 2012 3:43
Will: Your confusion is shown by the "Protection From Bankrupt Currencies Act" Greece doesn't have its own currency. That's the problem. The German-controlled ECB is torturing Greece in a way that it would never do to Germany.

Dean is wrong when he says "but yet refuse to take the steps (most importantly higher domestic inflation". Keynes, MMT = real, non-bastard Keynes is not about inflating prices. It is about spending enough to get non-inflationary growth, to fix private balance sheets, to accomodate savings, to maintain full employment.

If Greece spent enough Euros, was allowed to spend enough Euros, Greek debt might not decrease, but it wouldn't increase because of solvency risk, the main reason for its rise, not overspending. The Greek economy would just be allowed to fully employ its resources, while the German export obsession would mean the Euros would land up in Germany. Greece would spend what it got from Germany, improve its real economy, its real wealth, and Germany would get back what "it" spent in Greece - German financial wealth would increase, without inflation. A win-win for everyone. Identifying Keynesian economics with inflation or sticky prices or whatever is the incoherent bastard neoclassical "New" or whatever Keynesian route; not at all what Keynes stood for.
written by Phil, May 14, 2012 6:59
RE: "It is about spending enough to get non-inflationary growth, to fix private balance sheets, to accomodate savings, to maintain full employment."

None of those things flow from any sort of government stimulus, which merely spends more monry to ano effect and adds to the debt.

The only solution that creates genuine non-inflationary growth is that which comes from markets and private sector profits. Government does not cannot and never has created that. Only the private sector can.

In a few short months Greece will run out of money, at which point all of the arguments will be irrelevent because the Greek economy will shut down - there will be no money available for paying salaries and pensions.

At that point the Communist SPIRIZAS group can print all of the worthless drachmas they want - no one either inside or outside of Greece will accept or honor them.

That's the part which Greeks refuse to understand as they are living in their leftist Bizarro dream land - they are not borrowing money to pay down debt, they are borrowing money just to pay for the day to day operation of their state. They're not even bringing in enough money in taxes to pay for the continued operation of their government.

That's what happens when you mistakenly think you can operate at a deficit for years or decades - sooner or later you run out of the "Opium" (OPM) you have been living on, namely OTHER PEOPLES' MONEY.

The Germans are not going to pay out the nose forever to keep afloat a failed Greek state that continues to demand other peoples money but which refuses to make the substantive changes (closing money-losing state enterprises, laying off and actually firing the leeching worthless unneeded thousands of Greek civil servants). Greece will be kicked out of the Euro Zone. And no one, absolutely no one, is going to be willing to step in to that role or hand over money to a Greek state that has absolutely no prospects of ever becoming financially solvent and which resists and refuses to make the desperately needed reforms.

News flash: The Golden Rule is "Them That Has The GOLD, Makes The RULES".

If you need and want and expect me to hand over MY MONEY, then YOU NEED TO DO WHAT I SAY.
Oh, and by the way...
written by Phil, May 14, 2012 7:08
If anyone in Greece actually, seriously thinks they can "stick it to" the Germans and the rest of the EU and that "we'll just get money from the Chinese, the Russians and the Middle East"...

... I suggest that they put down the crack pipe, step away from the bong, put away whatever colorful illegal drugs they have been smoking, and slowly descend back to Reality.

The rest of the world isn't interested in throwing their citizens' money down a Greek rathole.

Here's what the rest of the world has to say about that suggestion:

New York Times: Greek culture of corruption leads to rampant tax evasion

China’s leaders under pressure at home to not bail out ‘lazy’ Greece

Europe's labour laws and welfare systems make workers lazy, says Chinese finance chief

Russian Pravda newspaper: Europe's kingdom of lazy people to be shattered again
Sigh, everything backwards as usual (1/2)
written by Calgacus, May 15, 2012 3:48
Phil: The usual everything backwards story. Everybody thinks these crazy things nowadays. They're taught everywhere - they're embedded in language. But nobody lives their life by them, because they make no sense. Even if everybody believed they inhaled Carbon Dioxide & exhaled Oxygen - it wouldn't make it true.

The only solution that creates genuine non-inflationary growth is that which comes from markets and private sector profits. Government does not cannot and never has created that. Only the private sector can.
Only governments can create that, has ever created that. Governments created money. Markets only come after money has been created. "Money" is basically just another word for "government debt". The private sector gets money from the government, not vice versa.

Of course everybody knows this deep down. The dollar bills in one's pocket are printed by the government. The government doesn't save up bills printed by Ford or Exxon. But quackonomists brainwash everyone with psychotic theories that say up is down, black is white. And they've brainwashed you.

That's the part which Greeks refuse to understand as they are living in their leftist Bizarro dream land Basically in Europe, the more leftist the society, the richer. Greek is far to the right, the rich are not taxed, social programs inferior to Germany, etc.

That's what happens when you mistakenly think you can operate at a deficit for years or decades - sooner or later you run out of the "Opium" (OPM) you have been living on, namely OTHER PEOPLES' MONEY. Governments have operated at deficits not for just years or decades - but for millennia. Surpluses are unsustainable. Deficits are infinitely sustainable, to the end of time. Governments usually only ever run surpluses or even balanced budgets for short times, because the overtaxation of the private sector tends to destroy the economy quickly.

Greece will be kicked out of the Euro Zone. Lets hope. Lets hope it makes the Eurozone collapse. The Euro is the worst monetary system of all time. It's a suicide pact, that by following the rules, must destroy every state in it, with the possible exception of Luxemburg. As Wynne Godley said when the suicide pact was signed, there is nothing in the design of the Euro & the EU that could prevent mass starvation in an economic crisis. Mass starvation.
Sigh, everything backwards as usual (2/2)
written by Calgacus, May 15, 2012 3:57
And no one, absolutely no one, is going to be willing to step in to that role or hand over money to a Greek state that has absolutely no prospects of ever becoming financially solvent and which resists and refuses to make the desperately needed reforms.

No sovereign state is ever financially solvent: That is its business – to be insolvent. To be in debt to all. (Sovereign) government debt is money. Money is government debt. Once Greece goes back to the drachma – it has an infinite quantity of drachmas. It doesn’t need drachmas. It doesn’t need anybody to hand it drachmas, any more than the USA needs dollars from anyone else. And if Greeks want to stay out of jail, they damn well will need and demand drachmas.

It doesn’t “resist these desperately needed”, destructive reforms. (The only good reform it needs is to fix its tax system – tax the rich, not the poor). It slavishly and rigorously imposes these monstrous reforms at the behest of the psychotic ECB. The reforms are the problem. The ECB is never satisfied. Maybe the Greeks should bomb themselves & sell their population into slavery. But that wouldn’t satisfy their tormentors. Germans are not now & would not be paying through the nose for Greece even if they allowed the ECB to print enough Euros to bring Germany to full employment. Germany & the ECB are torturing Greece and the rest of Europe, to zero benefit to Germany & Europe, because of an insane theory. This time it’s insane, innumerate everything-backwards economics. I’ve always appreciated German culture – but when they go crazy they go in a big way. Cf. Nietzsche’s famous prophecies about the bad things that might happen – and Hegel’s & Heine’s similar but not so famous ones.

If you need and want and expect me to hand over MY MONEY, then YOU NEED TO DO WHAT I SAY. Try that with the IRS. Or even a tollbooth.

Posted in the forlorn hope that you or others might just stop walking, stand for a moment on your hands, scratch your head with your foot, and might just think for a moment that you might be doing everything, looking at everything upside down.
Complete, total, utter Communist lying B.S.
written by Phil, May 15, 2012 3:46
RE: "The private sector gets money from the government, not vice versa."

That's complete, total, utter nonsense. It's absolutely the other way around. Government does not create one dime of wealth. Government has no sovereign wealth of its own. Government does nothing at all productive and does not "create" anything. The ONLY source of wealth it has is that which it extracts from the productive, the hardworking, the private sector in the form of taxes. Absent that it has no "wealth" whatsoever. All it has are worthless pieces of paper that are not backed by anything tangible or real. Basically it's pretty obvious that you have been brainweashed by lying communist propaganda and that you have no basic understanding whatsoever of basic Economics 101.

RE: "Basically in Europe, the more leftist the society, the richer." Wrong, completely wrong, The richest societies in Europe are those that are ferociously capitalist, especially Germany. The more leftist the society, the more indebted it is, the more of Other Peoples' Money it has to borrow.

RE: "Once Greece goes back to the drachma – it has an infinite quantity of drachmas."

The drachmas are worthless - they are not based on any underlying wealth or sovereign assets. The Greeks better damn well NOT accept or expect to be paid in them, because their "money", if you laughingly refer to it, will be utterly worthless. And no, we outside Greece will not accept payment in drachmas for anything. The Greeks can carry their life savings in drachmas to the supermarket in wheelbarrows to buy themselves a loaf of bread. That's what happens when governments print endless supplies of worthless bank notes thyat no one wants or is willing to accept.

Based on your ludicrous absurd socialistic ideas abvout finance, you would probably believe that people in Zimbabwe are "wealthy beyond their dreams" because 1,000% inflation keeps causing the central bank to add more zeros onto the numbers on every bank note. In reality they are starving to death in a collapsing socialistic ecomomy in which their paper money has utterly no value. That's the fate that's awaiting Greece.

written by Phil0, May 15, 2012 4:18
Phil -thanks for choosing this penname, it makes us nominally neighbours-, are you twisting reality on purpose or not?

You know, the civil servans in Greece' ve been only recently counted under Troika, because the Greek neoliberals and papers like 'Bild' thought they were too many. And they were found to be below the arithmetic means of EU/Eurozone. The hours per week at work were found very many and excessive and the days off work were found to be few, and certainly below the german ones.

But, as far as I know, at least friedmanite neoliberalism is pure and idealistic science, and, consequently, it does not need emperical data to support its views, does it?

Finally, for your information, SYRIZA is not a communist party, but rather a nontraditional left party. Can you tell the difference?
Forget about Greece borrowing money from China, Russia or anybody else
written by Phil, May 15, 2012 4:47
The Russian view, from Pravda:

Europe's kingdom of lazy people to be shattered again

The Chinese view:

China’s leaders under pressure at home to not bail out ‘lazy’ Greece

What you appear not to understand is that it does absolutely no good to print tons and tons of new currency, if the currency is worthless - it has no sovereign value, because it is not based on any economic wealth or underlying value.

Government has utterly no "wealth", no money of its own. Its ONLY wealth is that which it extorts and extracts from the hardworking, the deserving, the private sector, and hands to the worthless, the shiftless, the useless, the lazy, the unproductive, the undeserving.

Zimbabwe has full control over their currency. They print all the Zimbabwean dollars they want, it's their standard solution to everything and anything. Their currency is absolutely worthless. Nobody in their right mind anywhere on the planet outside of Zimbabwe will accept Zimbabwean currency - it is worthless. Inflation is in the thousands of percents because the communist Zimbabwe government responds (like the Greeks) merely by printing more worthless currency, adding more zeros to their currency and fueling inflation, because they absolutely refuse to take the steps necessary to make their government solvent - i.e. firing the thousnds of overpaid, underworked, unneeded civil servants. The result is utter destitution. Inflation runs wild. Companies stop producing products because with inflation skyrocketing it becomes impossible to produce anything at a profit, which is the only reason why anything can or should be made - for profits. Goods vanish from store shelves, businesses close. Imports become completely financially out of reach. Peoples' life savings become worthless. It takes thousands of drachmas to buy a loaf of bread. Anyone of working age capable of leaving, flees the country leaving behind the dogmatic communists and those too financially impoverished to leave.

That's the fate in store for Greece. And it is what they deserve. Civil services do not exist to "create jobs", there should never be even one single solitary more civil service job existing than is absolutely needed. Governments do not exist to "create jobs", government cannot ever create one single prodit-making productive job, the only valuable jobs created are those created by the private sector, government is the last-refuge employer of those too stupid and incompetent to get real jobs in the private sector.
Social darwinism mixed with absence of data
written by Phil0, May 16, 2012 3:06

You are continuing this disappointing generalised antigreek spree, while your facts are absent. Check out below, please, these are the official data from Eurostat -which is not Communist, btw:

"According to the latest Eurostat statistics, the Greeks work 40.6 hours a week, most of all 27 EU member states. That says nothing about productivity and efficiency — which is lower — but it does say something about the alleged laziness of the Greeks. According to OECD figures of 2009, the Greeks are the only ones among western countries who exceed the line of two thousand working hours per year: Greece, 2119 per year; Australia 1690; Belgium 1550; Netherlands 1378. That the average Dutch people in the street, or average Dutch journalists are ignorant, fail to inform themselves, and utter the most insulting remarks, doesn’t surprise me given our social climate, but if politicians and notables express themselves in the same way, it’s time to ring the alarm bell."
Source: http://roarmag.org/2011/06/gre...nal-media/
If you research a little more, I' m sure you shall find more. I respect your hardcore capitalist and social darwinist zeal, but at the same time I think that you should respect reality more.
I suggest that you get in contact with reality yourself
written by Phil, May 16, 2012 4:19
..because you are the one whose facts are absent.

Here are the facts behind Greece's fat, bloated, overpaid, underworked, massively excessive public sector which you refuse to recognize:

Here is why Athens is taking the axe to state jobs: Greece’s public sector employs around 700,000 or 800,000 people. Exact estimates are hard to find. What is certain is the drain this has placed on the small country’s finances, starting in the 1980s.

Both the left and right in politics used the system, rewarding supporters with jobs. With every political power shift, the public sector grew, as more people were hired.

Haralambos Koutalakis, a lecturer on public administration at Athens University, said: “Over the years the two big parties have created a large public sector mainly with clientelistic processes of employing people and that is going to be very difficult to change because it requires a whole reorganisation of the way that services are run and of the way that things are done in the public sector.”

About 20 percent of the working population is some sort of civil servant, in a job that has been guaranteed for life under the constitution.

The public sector is bloated and inefficient but getting a job in it has been a national prize for decades. While the Greek average monthly wage is around 700 euros, a civil servant starts at 800, and bonuses can push that to 1,300 a month.


Now, here are The Facts Of Life:

Absolutely NOBODY should EVER be "guaranteed" a "job for life". Yet that is what has happened in Greece. Once Greek government labor is hired, they are overpaid, underworked, virtually immobile and almost impossible to fire.

Roughly 20% of the Greek working population is employed by government, a figure that is staggeringly high and wasteful and an enormous drain on Greece's budgets in a country that has virtually no heavy industry, few major employers and a business sector that is running for its life and trying to leave the country.

The equivalent figure in the U.S. is less than 10% employment by the public sector, which is exactly as it should be.

Nobody at all should ever have "lifetime" employment or job "guarantees" - least of all, civil servants who add no value whatsoever to the economy, who create no profits, who create no jobs whatsoever, who create no wealth, who extort wealth from the hardworking and productive taxpayers and who return absolutely nothing of value.
The capital / currency flight from Greece has already started
written by Phil, May 16, 2012 4:47
When Greece is expelled from the Euro Zone, which it inevitably will be, the Greek "government" (if such a thing exists) will predictably respond by printing millions of worthless Greek drachmas and demanding that Greeks hand in their Euros and accept these worthless drachmas in exchange.

Even Greeks are not quite so stupid as to agree to that - they already know full well that the value of the drachma will collapse within days, from an initial value of 1:1 (one Euro = 1 drachma) to 1:500 or greater (one Euro = 500 drachmas).

This is because, having refused to make the substantive changes and reforms which are desperately needed, i.e. reducing the cost of government by slicing off the 'fat' and layers of unneeded and expensive bureaucracy, permanently firing the thousands of excess and uneeded snivel servants, raising the retirement age and getting more productive years of work out of their citizens...

... the Greeks have opted to refuse to make any changes whatsoever, instead preferring to idiotically and insanely believe that the rest of the world will somehow "have no choice but" to keep paying through the nose and subsidizing Greece's Marxism-Leninism.

The result is that wage and currency devaluations, instead of being limited to those sectors that need a meat-axe taken to them (the bloated and inefficient overemployed public sector) will now be applied...

... to the entire country as a whole, in the form of the massive devaluation of Greece's currency.

Not having necessarily been born under the birth sign of 'Stupid', some Greeks -- realizing that any Euros they still have will soon be worth 10 to 50 times' what the emerging drachma will buy, are anxiously moving money out of the country right now, rather than watch their "Greek Euros" become devalued down to nearly nothing when the Greek government forcibly demands that Greeks trade in their Euros for worthless drachmas.

The free-fall is already starting.. Congratulations, Greek commies, you brought this on yourselves. Everything I said would happen, is now happening. Happy now?

Greeks withdraw $894 million in a day: Is this beginning of a run on banks?

Political leaders in Athens were due to discuss an emergency government Wednesday to deal with a possible run on banks as it emerged Greeks withdrew almost $900 million in a single day, fearing their country could crash out of the euro currency by the end of the week.

Greeks are withdrawing euros from banks, apparently afraid of the prospect of rapid devaluation if the country leaves the European single currency and returns to the drachma.

Jenny P., an Athens private medical clinic receptionist originally from Ohio, told msnbc.com she had withdrawn 85 per cent of "what's left" in her bank account.

"We could have a new currency in a couple of days and nobody knows for sure what will happen," she said. "There are no lines to withdraw money, but maybe that's because many Greeks have precious little left in the bank. Many have been surviving on [$500] 400 euros a month, which has to cover tax, bills, food and medical costs."

She said she was planning to return to the United States amid the economic turmoil which has left her Greek husband unemployed. "It is hard to see what the future will be here," she said.

Just to end this
written by Phil0, May 17, 2012 7:52
Phil, you are being so judgmental, without knowing, well, anything well really.
I understand that all versions of hardcore capitalism hate and defamate the public sector with all kinds of things, true to a certain extent or -more often- false.
But, regarding the greek public sector, let's take a look at the statistics from Eurostat, via a quite clearly right-wing perspective:
"According to 2011 Eurostat figures, Greeks work an average of 42.1 hours a week, which is the highest in the EU and six hours more than their German counterparts.
At least two-thirds of Greeks pay their taxes unfail­ingly.
Less than a quarter of Greeks – and soon 150,000 fewer – are employed in the public sector where the aver­age salary is being reduced to below 1,500 euros.
According to Eurostat, the minimum retirement age in Greece last year was 61.4. In Germany, it was 62. The pension reform bill voted through the German Parlia­ment in 2007 aims to raise the minimum retirement age to 63 by 2029. The pension law passed in Greece last year will raise the retirement age to 63.5 by 2015.
A study by Mercer Human Resource Consulting found that an employee in Greece with 10 years’ service will have a total of 37 days’ leave each year (12 of them public holidays), while their colleagues in Germany will receive 33 days off (13 of them public holidays).
The fact that these stereotypes have become part of the public debate, either through the tabloid media, such as Germany’s Bild-Zeitung, or through populist parties such as the True Finns and the Dutch PVV (Freedom Party), is damaging the efforts to find a proper solution to Greece’s problems because it feeds sensationalism in the lender countries and antagonism in Greece. It is, therefore, im­portant that a sense of reality is reintroduced to the proc­ess of tackling the Greek crisis if both the European and the Greek public are to keep supporting the efforts."

Moreover, according to the internationally official data, the expenditures made for the public sector wages are 10,6% of GDP, whilst in E.U. of 27 it is 10,8% and within the Eurozone 11% of GDP.

For all it matters...
written by Phil, May 17, 2012 8:00
You know, I realize that you are probably twenty-something years old and have barely any life-experience to speak of. And I realize that you have probably been brainwashed by years of Marxist propaganda. But even so, your comments are absolutely stunning to me in their ignorance.. How anyone could seemingly lack the most basic Real World knowledge of Basic Economics and how the world actually works is just mind-boggling to me.

I mean, the very idea that you would even actually compare Germany and Greece in the same sentence, is utterly mind-boggling.. That you would even compare relative statistics, as though they are in any way "equivalent", "equal" or even mean anything is absolutely mind-boggling in its infantile simplicity.

Therefore, since you quite clearly are ignorant in your perception of economics, I will graciously take it upon myself to educate you.

You see, Young One, in this world, there are Rich Nations, there are Well-Off nations, and then there are Poor Nations. They are Rich, Well off or Poor for their own individual reasons. And that is entirely acceptable. It is absolutely acceptable that some nations are very Rich, while others are desperately Poor. There is absolutely nothing whatsoever "wrong" with some nations being Poor while other nations are Rich. There is nothing "abnormal" about some nations being wealthy while others are not. In fact, not only is there nothing whatsoever "abnormal", it is the absolutely normal situation and one that must not be messed with. It is the way things are supposed to be... Some nations are destined, for one reason or other, to be fabulously wealthy, while others are destined to remain desperately poor. And the reasons for this are entirely natural: Some nations are blessed with deep natural harbors, some are blessed with well-educated industrious and hardworking people, while others are landlocked and/or lacking in natural resources. That some nations are Rich while others are Poor does not mean in any way, shape or form that anything "needs to be done about it".. In fact, NOTHING AT ALL should EVER be "done" about this fact... It is the natural order of things. Nations that are Poor, are Poor for their own reasons. They are NOT Poor "because of" other nations being wealthy. It is NOT the "fault" of anyone at all that some nations are Poor while nothers are Fabulously Wealthy, no one at all is "to blame" for this fact, it is the natural order of things and one that must be left intact. It is NOT the "responsibility" of the Rich Nations to try to "make" Poor Nations "non-poor". The ONLY responsibility of the Rich Nations is to look after their people and themselves, and to expect others to do the same.

written by Phil, May 17, 2012 8:05
Two such examples of Nations come readily to mind: Germany and Greece. Germany is an example of a very Rich nation. Germany is rich for a lot of very fine and wise reasons: Its people are industrious, well-educated and hardworking. It has a thriving and ferociously competitive private sector which its government is very careful not to undermine. It has a wide variety of businesses, which thrive because the government in Germany is sensible enough to understand that real wealth CAN ONLY -EVER- be generated by the private sector, NOT by government", and that therefore excessive, burdensome and socialistic regulation will hamper the private sector and cause the private sector to shift jobs overseas, as is the private sector's Absolute Right. Therefore, such burdensome, excessive and socialistic regulation is to be avoided at all costs. What is Good for The Private Sector, is Good for The Economy, and what is Good For The Economy, is Good For Germany. That's the biggest reason why Germany is a wealthy nation - it knows to not interfere with the private sector, whose awesome and God-given abilities are what make all wealth-creation possible in the first place.

Another, major reason why Germany is a Rich nation is because, quite bluntly, its people are sensible enough to do what's known as Living Within Their Means. This means that they don't spend money that they do not have. This means that they do not take out excessive credit, get in over their heads with that credit to the point that they cannot pay their bills, and then run whining and expecting someone else to bail them out. If the German (and the American) need to buy something, they pay for it with cash. If they don't have the money to pay for it, then there is a simple solution: They simply don't get "it", whatever "it" is, in the first place. They do without.

They understand that they are not "owed" or "entitled" to anything. And they especially understand that they are not "owed" or "entitled to" anything their harder-working or wealthier neighbor has. They don't "hate" their wealthier neighbor. They admire their wealthier neighbor. They want to BE LIKE their wealthier neighbor. They recognize that maybe THE REASON their neighbor is wealthier is because maybe he IS SUPERIOR TO THEM, maybe he IS BETTER THAN THEM, and thus he is to be admired and emulated.

More importantly, they recognize that they are expected to act like grown-ups - not whiny little children who seemingly need to be "protected" from "The Big Bad World". They do not run whining and beg for handouts merely because they were stupid enough to not be able to say 'no' to offers of credit. They recognize that nobody ever held a gun to their head or 'forced' them to take out lines of credit that they could not afford. They recognize, first and foremost, that their ONLY 'obligations' are to THEMSELVES - to their families, to their communities, to their country. They recognize, quite rightly, that it's not "their responsibility" to bail out anybody in some other country who was too stupid to manage their own affairs. That is what is known as being Just Tough S##T For The Other Guy.

And they also realize that they are strctly on their own, that they have no 'right' to run whining to anybody or expect anybody else to bail THEM out of THEIR problems, either. They take responsibility for themselves. They don't blame others for their problems or misfortune.

That is the way the world works, you see. It is Your Individual Responsibility to manage your affairs. Nobody, nobody at all, "owes" you anything whatsoever. You are not "entitled" to a job, you are not "entitled" to an income, you are not "entitled" to any minimum standard of living whatsoever. You can work, or you can starve, and either alternative is acceptable. And yes, that means that YES, WE WILL allow you to starve. That is what naturally should happen - you should be forced to suffer the consequences of your actions, to pay the natural price for your sloth and indolence and your inability to manage your own affairs. It is wrong of others to try to 'rescue' you, because by 'rescuing' you, they prevent you from suffering the natural consequences of your actions which you need to suffer in order to learn your lesson.

The Germans' ONLY responsibility is to themselves - not to the rest of Europe, not to poor countries, not to anybody except themselves, their families, their employers, their communities.

written by Phil, May 17, 2012 8:10
Now, let's pretend that I am Germany and you are Greece. I am a Rich nation. Therefore, I can afford for my people to have a certain number of vacation days. I can afford for my country to have a certain number of civil servants, but absolutely NONE of those snivel servants have jobs due to political patronage, they are there to do a job that needs doing, otherwise they would not be employed in the snivel service, they would be in the private sector doing something productive with their lives and creating the profits on which society functions.

You, Greece, are a Very Poor country. And that is Your Individual Problem to deal with. You are not poor "because of" me, you are not poor "because of" Germany, you are poor because of yourself. You are a poor country because you lack natural resources. You are a poor country because your people are famously lazy. You are even more poor because you oppress and burden the only productive part of your economy, the private sector, with a thicket of oppressive socialistic regulations that discourage businesses from hiring people or creating jobs. And you are even more poor because you absolutely refuse to live within your means.

You see, we nations - Germany and Greece - may both be in the EU, but that's where the "resemblance" ends - there is utterly no comparison between the two of us. You are not my equal, you are not even close to ever becoming my equal. You are NOT "deserving of" my lifestyle. You are NOT "entitled to" the same lifestyle as what I enjoy. And you need therefore to know your place. You need to act like the Poor Nation that you are, and stpop pretending that we are "equals". We are NOT "equals" - far from it.

If people in Germany can retire at 62, then people in Greece need to NOT be allowed to retire until they are at least 65 or 70.

If people in Germany receive 33 days of vacation per year, then people in Greece need to NOT be allowed to receive more than 10-15 vacation days per year.

And why is this? Because that is all that you can afford. Because you need to live within your means. Because living within your means, means that you don't get to have the same lifestyle as wealthier and richer countries, whether you like it or not.

Because I, Germany, am a Rich nation, one which CAN AFFORD to give my people these retirement ages and these days off.

You, on the other hand, ARE A POOR NATION and YOU CANNOT AFFORD to give your people these same numbers of vacation days, or let them retire at an age anywhere comparable to the age that Germans retire at.

You, being a Poor Nation, cannot afford and thus have no business trying to imitate the lifestyle which I, a Rich Nation, provide to my citizens. You need to act like the Poor Nation that you are. You NEED TO MAKE DO WITH LESS THAN what I have. You ARE NOT "entitled" by your financial position to have the same kind of lifestyle which wealthier nations provide to their citizens. You need to remember that we are not "Equals", that you are NOT "entitled" to the same lifestyle as me, and that you need to remember your place.

written by Phil, May 17, 2012 8:15
You, Greece, need to live within your means.

If living within your means, means that you have to wait until age 65 or 70 to retire, while I in Germany can retire at age 62, because that's all you can afford, then that's the way it has to be.

If living within your means, means that you can only afford to have 2 weeks' vacation instead of four per year, then you'll accept that and damn well live with it and like it, too. Because you have to live within your means and understand that you can't have the same "bennies" and standard of living as your wealthier EU neighbors.

You see, Young One, that's what Living Within Your Means is all about. That's what Being Individually Responsible For Yourself means. It means that you realize, understand and accept that you aren't "entitled" to ANYTHING AT ALL OTHER THAN what you work for and earn.

It means accepting that you aren't "entitled" to have the same standard of living as someone who is wealthier and richer than you. You are only "entitled to" what you have worked for and earned.

And there is utterly no comparison between you (Greece) and me (Germany). And you are absolutely NOT AT ALL "entitled" to have "the same standard of living" as me. You don't deserve it, you aren't "entitled" to it, you must not be given it.

And that's exactly how Greeks have gotten themselves into trouble - because they refuse to accept this simple, basic Fact. They refuse to accept the fact that they are not Germany, that they are a Poor country and not a Wealthy country like Germany, that they are absolutely NOT "entitled" to have the same standard of living as Germany. And because of this, they childishly got themselves in over their heads, they stupidly hired more snivel servants than were needed and far more than a poor country like Greece needs or can ever afford, they foolishly borrowed and spent money they didn't have.

And now, they are about to Pay The Piper, as the Germans say.

You see, that's what happens when you forget your place, when you forget that you are a Poor Country and not a Wealthy Country like Germany, when you start to think you are somehow "entitled to" a lifestyle that you do not deserve and have not earned.

You get to end up having to Pay The Piper.
Funny that you should consistently trust and refer to "Eurostat", since the Greeks lied to Eurostat from the get-go...
written by Phil, May 18, 2012 1:00
RE: "According to the latest Eurostat statistics...."

From Wikipedia:

Greek government-debt crisis - Causes

In order to understand when, how and why the Greek government-debt crisis erupted and eventually how it can be solved, it is important to note the crisis is not limited to a simple debt level problem. Several other main causes exist along with the debt level problem. Already in January 2010, before the extent of the debt-crisis was truly known, the Greek Ministry of Finance highlighted in their Stability and Growth Program 2010 these five main causes for the significantly deteriorated economic results recorded in 2009 (compared to the published budget figures ahead of the year):

* GDP growth rates: After 2008, GDP growth rates were lower than the Greek national statistical agency had anticipated. The Greek government now acknowledges the need for implementing economic reforms to improve competitiveness (being hampered during the last decade, due to excessive salary increases and counterproductive bureaucratic laws and procedures), and the need to redirect much of its current governmental spending from non-growth sectors (e.g. military) into growth stimulating sectors.

* Government deficit: Huge fiscal imbalances developed during the past six years from 2004 to 2009, where "the output increased in nominal terms by 40%, while central government primary expenditures increased by 87% against an increase of only 31% in tax revenues." Thus the Greek government now acknowledges the need to restore the fiscal balance of the public budget, by implementing permanent real expenditure cuts (meaning expenditures are only allowed to grow 3.8% from 2009 to 2013, which is below the expected inflation at 6.9%), and with overall revenues planned to grow 31.5% from 2009 to 2013, secured not only by new/higher taxes but also by a major reform of the ineffective Tax Collection System.

* Government debt-level: Since it had not been reduced during the good years with strong economic growth, there was no room for the government to continue running large deficits in 2010, neither for the years ahead. Therefore, it was not enough for the government just to implement the needed long term economic reforms, as the debt then rapidly would develop into an unsustainable size, before the results of such reforms were achieved. Thus the government acknowledged that they now immediately needed to implement both permanent and temporary austerity measures that - in combination with an expected return of positive GDP growth rates in 2011 - would result in the baseline deficit decreasing from €30.6 billion in 2009 to only €5.6 billion in 2013, finally making it possible to stabilize the debt-level relative to GDP at 120% in 2010 and 2011, followed by a downward trend in 2012 and 2013.

written by Phil, May 18, 2012 1:08
* Political budget compliance: Was acknowledged to be in strong need of future improvement, and for 2009 it was even found to be: "A lot worse than normal, due to economic control being more lax in a year with political elections". In order to improve the level of budget compliance for upcoming years, the Greek government wanted to implement a new reform to strengthen the monitoring system in 2010, making it possible to keep better track on the future developments of revenues and expenses, both at the governmental and local level.

* Statistical credibility: Problems with unreliable data had existed ever since Greece applied for membership of the Euro in 1999. In the five years from 2005–2009, Eurostat each year noted a reservation about the fiscal statistical numbers for Greece, and way too often previously reported figures got revised to a somewhat worse figure, after a couple of years. In regards of 2009 the flawed statistics made it impossible to predict accurate numbers for GDP growth, budget deficit and the public debt; which by the end of the year all turned out to be far worse than originally anticipated. As the new Greek government acknowledged the need for a stronger statistical credibility, both in order to restore the trust among financial investors and as a mean for the government to better know the level and necessity of future economic reforms (in advance), they now pledged to correct all previous statistical methodological issues, "by making the National Statistics Service an independent legal entity and phasing in, during the first quarter of 2010, all the necessary checks and balances that will improve the accuracy and reporting of fiscal statistics".

written by Phil, May 18, 2012 1:13
According to an editorial published by the Greek right-wing newspaper Kathimerini, large public deficits are one of the features that have marked the Greek social model since the restoration of democracy in 1974. After the removal of the right-wing military junta, the government wanted to bring disenfranchised left-leaning portions of the population into the economic mainstream. In order to do so, successive Greek governments have, among other things, customarily run large deficits to finance public sector jobs, pensions, and other social benefits.

Since 1994, the ratio of debt to GDP has remained above 94.0%. In the turmoil of the Global Financial Crisis it rapidly grew above the maximum sustainable level for Greece (defined by a many of economists to be 120%). According to "The Economic Adjustment Programme for Greece" published by the EU Commission in October 2011, the debt level is even expected to reach a highly unsustainable level of 198% in 2012, if the proposed debt restructure agreement is not implemented.

Initially, currency devaluation helped finance the borrowing. After the introduction of the euro in January 2001, the devaluation tool disappeared. Throughout the next 8 years, Greece was however able to continue its high level of borrowing, due to the lower interest rates government bonds in euro could command, in combination with a long series of strong GDP growth rates. Problems however started to rise, when the Global Financial Crisis peaked with negative repercussions hitting all national economies in September 2008. The Global Financial Crisis had a particularly large negative impact on the GDP growth rates in Greece. Two of the country's largest industries are tourism and shipping, and both were badly affected by the downturn, with revenues falling 15% in 2009.

Another consistent problem Greece has suffered from in recent decades, is the government's tax income. Each year it is several times below the expected level. In 2010, the estimated tax evasion costs for the Greek government amounted to well over $20 billion per year.

To keep within the monetary union guidelines, the government of Greece had also for many years misreported the country's official economic statistics.[

At the beginning of 2010, it was discovered that Greece had paid Goldman Sachs and other banks hundreds of millions of dollars in fees since 2001, for arranging transactions that hid the actual level of borrowing.

The purpose of these deals made by several successive Greek governments, was to enable them to continue spending, while hiding the actual deficit from the EU.

As reported in the table below, the revised statistics revealed that Greece at all years from 2000-2010 had exceeded the Euros stability criteria, with the yearly deficits exceeding the recommended maximum limit at 3.0% of GDP, and also the debt level clearly exceeding the recommended limit at 60% of GDP.


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Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.