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New It's hard to have a primary surplus without collecting taxes...
Greece's tax structure has problems - no doubt. But it's hard to fix things like that in the middle of a depression. Demanding that they do so, without providing the means to do so, is a recipe for failure.

And demanding that Greece find the way to make debt payments only one particular way (cutting pensions and not spending money to hire people to collect taxes, vs raising taxes on the wealthy and corporations) is a red line they know Greece will not cross without throwing out the government (and they just had an election).

Wikipedia's summary seems to me to be fair:

In the early mid-2000s, Greece's economy was one of the fastest growing in the eurozone and was associated with a large structural deficit.[29] As the world economy was hit by the financial crisis of 2007–08, Greece was hit especially hard because its main industries — shipping and tourism — were especially sensitive to changes in the business cycle. The government spent heavily to keep the economy functioning and the country's debt increased accordingly.


(read the whole section)

People don't go on vacation when they're worried about losing their jobs.

Most of the unreasonable demands are being made by the Troika.

DeLong has an interesting compare-and-contrast between now and Schumpeter's 1934 book.

Oh, and the the pain is already spreading to Italy, Spain and Porugal...

FWIW.

Cheers,
Scott.
New I don't disagree
But it doesn't matter how much money you tip into Greece, or how much of the debt is forgiven, because the lack of fiscal responsibility by the Greek government (up to and including a complete failure to tackle corruption, graft and unbelievably wholesale tax evasion) means that there are two choices here:

1. Kick the can down the road. This is achieved by a new deal, more money, forgiving debt, etc.
2. Let it burn. Have no doubt - this will kill people, as hospitals find themselves unable to purchase drugs and equipment. It will be a huge shit sandwich for ordinary Greeks, probably for a decade or more.

So far, the EU has resisted (2) with all its considerable might.

Yes, the troika has been hard on Greece and yes, what is being asked for probably can not and will not be delivered. That certainly satisfies a defensible definition of "unreasonable".

But what is the practical alternative? The Greeks have had decades to show that they can run an economy, and they have signally failed to do so. If you're going to set your retirement age low, as the Greeks have, you need to get your game face on and do some serious tax collection to make sure the pension fund is where it needs to be.

They lied their way into the Euro, and now the chickens are coming home to roost.
New Bring back Ottoman rule! :)
Unless that's when the bad habits were learned.

The honor guards wouldn't even have to change their uniform.
Alex

"There is a cult of ignorance in the United States, and there has always been. The strain of anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that "my ignorance is just as good as your knowledge."

-- Isaac Asimov
New Yes, but the Turks have much fancier outfits.
New you sure? looks like a shriners convention
Any opinions expressed by me are mine alone, posted from my home computer, on my own time as a free American and do not reflect the opinions of any person or company that I have had professional relations with in the past 59 years. meep
New More on the structural problems facing Greece:
http://www.theguardian.com/commentisfree/2015/jun/27/greek-bailout-extension-refused-panel-leading-economists-give-their-verdict

From a hejookated chap:
The reality is that Greece has a highly uncompetitive economy and no credible tax collection system. The problems mostly are in the product, capital and housing markets that remain unaddressed. According to the World Bank’s Doing Business rankings, Greece ranks 61st, just behind Tunisia. Greece is 155th in the ability to enforce contracts, just ahead of Laos and Botswana. There has been no reform to speak of. Greece is characterised by endemic tax evasion, a poor tax collection infrastructure, parochial patronage policies, corruption and huge delays in the administrative courts dealing with tax disputes. Greece also has deep structural problems, mostly in product markets with oligopolies in almost every industry, closed professions, administrative and bureaucratic impediments to entrepreneurship alongside barriers to trade and exporting, none of which have been addressed. This baby certainly isn’t over. The worry is if the inevitable Greek default spreads.

http://arstechnica.com/civis/viewtopic.php?p=29334345#p29334345

Some Chap On The Internet:
Lets see now... Their election promises.

1. 300,000 new jobs in the private, public and social sectors, and a hefty increase in the minimum monthly wage - from €580 ($658; £433) to €751 ($853; £562)
2. 300,000 households under the poverty line up to 300 kWh of free electricity per month and food subsidies for the same number of families who have no income. Tax on heating fuel would be scrapped.
3. They promised to reinstate a Christmas bonus pension for pensioners receiving less than €700 ($795; £524) a month.
4. A writing off most of Greece's €322bn ($364bn; £236bn) debt, a colossal 174% of its gross domestic product (GDP).
5. When Syriza came to power it promised to halt a string of privatisations, such as the port of Piraeus and the big energy company, Public Power Corporation of Greece.
6. Property owners in Athens's leafy, northern suburbs were enticed with the promised abolition of a hated annual levy on private property. Known as "Enfia", the tax was introduced in 2011 as an emergency measure but made permanent under the previous government.
7. Repayment of the remaining debt tied to economic growth, not the Greek budget
8. A "significant moratorium" on debt payments
9. The purchase of Greek sovereign bonds under the European Central Bank's €60bn ($68bn; £45bn) monthly programme of quantitative easing
10. A European Debt Conference modelled on the write-off of half of Germany's post-World War Two debt

Do you know how possible 7-10 were with 1-6? Nil. Nothing. Nought. Zilch. Fuck all. No fucking way. At all. Ever. Not happening. No fucking way.

Anyone with more than one functional brain cell knew this, yet the Greek voters lapped this shit up. So you know what? YES THEY DID FUCKING BRING THIS ON THEMSELVES. If the Greeks don't like it, well they can fucking lump it for all I care.

Whatever happens, it's going to be mightily shitty for the Greek on the Athens Omnibus. But that's what happens when you don't pay/collect your fucking taxes.

The chickens are coming home to roost.
New Yeah, if only Syria had not won the election, then the Banksters would have fixed everything... :-/
New So what's your solution?
Just forgive the debt, then let them get into this mess again in a decade or so, and then what?
New Excluded middle ... but you know that, right?
How about forgive the debt, then make sure they don't get into this mess again? You know, like what we (allegedly) did for the banks.
--

Drew
New OK, how do you do that?
You're just going to impose a functional economic system on them, yes?

Did you miss the part where everything (and I mean everything) in their economic system is either fucked, corrupt or both?
New You broke it, you bought it
If I had an easy answer I'd be applying for my Nobel already. But I know "make it substantially worse than it already is and still don't fix anything" isn't a great plan.
--

Drew
New This.
The IMF report recommendations is a good start.

Cheers,
Scott.
New Why not?
You assume that that's the worst possible outcome.

Perhaps things have to get substantially worse before the Greeks are moved to fix their problems and thus make things better.
New I don't know that 12-step programs work on social psychology
"Hitting bottom" is generally talking about breaking addictions or chronic behaviors. I wouldn't assume that it applies equally to a society.

An individual can be erratic but a psychological breakthrough only has to happen once. In a society different groups can have their own epiphanies, while other groups invent new pathologies on the fly. Do you really want to count on an entire country achieving enlightenment simultaneously?
--

Drew
New Or we could just keep right on tipping money into their economy
...which will keep them retiring at 50 on 80% of their final salaries.

Yeah, let's do that.
New Oh, I see, you just make up convenient "facts."
Greeks retire early. The figure of 53 years old as an average retirement age is being bandied about. So much so, that it is has become folk-fact. It originates from a lazy comment on the New York Times website. It was then repeated by Fox News and printed in other publications. Greek civil servants have the option to retire after 17.5 years of service, but this is on half benefits. The figure of 53 is a misinformed conflation of the number of people who choose to do this (in most cases to go on to different careers) and those who stay in public service until their full entitlement becomes available.

Looking at Eurostat’s data from 2005 the average age of exit from the labour force in Greece (indicated in the graph below as EL for Ellas) was 61.7; higher than Germany, France or Italy and higher than the EU27 average. Since then Greece have had to raise the minimum age of retirement twice under bail-out conditions and so this figure is likely to rise further.

http://www.newstatesman.com/blogs/world-affairs/2012/05/exploding-myth-feckless-lazy-greeks


New Whev
Go you! You found an error that makes Greece kindasorta not look like a complete economic basket case! Technically correct, the best kind of correct!

They're working SO hard and being SO honest and they're SO well-disciplined that this is all someone else's fault.

Fuck that.

Greece is in a bed of its own making - a debt built on endemic corruption, tax evasion, cronyism and all the other shit that goes along with it. As a nation, if you dodge €30B/year of taxes but spend the money anyway, you're gonna end up fucked.

But yeah, it's obviously not Greece's fault and the EZ countries should just keep right on paying.
New Re: EZ countries should just keep right on paying.
I'm not suggesting that. I'm only suggesting that the bankster controlled governments admit their part in making a bad situation (entirely the fault of the Greeks) immeasurably worse and the current "we must continue the punishment, it's the only way to save them" policy is horribly flawed.
New Right.
It's a relatively new country after all. If they're going to survive for, say, as long as England has and ever contribute anything to the world, they'll figure these things out. But today they're so young. Left to their own devices they'd obviously disappear in a decade.
     Greece: It's the politics, stupid! - (Another Scott) - (41)
         Nah! The Greek governmaent was elected to stiff the rest of EU. - (a6l6e6x) - (29)
             We'll see. - (Another Scott) - (28)
                 They will have a depression now. - (a6l6e6x) - (5)
                     25+% unemployment for 3+ years isn't already a depression? - (Another Scott) - (4)
                         is that american unemployment measure or really counting all the people out of work? -NT - (boxley) - (2)
                             Re: is that american unemployment measure or really counting all the people out of work? - (Another Scott) - (1)
                                 For one thing BLS has the notion of "discouraged workers". - (a6l6e6x)
                         If it's measured like in the US, then yes. - (a6l6e6x)
                 Greece was supposed to have a shallow recession - (pwhysall) - (21)
                     The endemic tax evasion problem goes back decades. - (static) - (1)
                         Agreed 100% -NT - (pwhysall)
                     It's hard to have a primary surplus without collecting taxes... - (Another Scott) - (18)
                         I don't disagree - (pwhysall) - (3)
                             Bring back Ottoman rule! :) - (a6l6e6x) - (2)
                                 Yes, but the Turks have much fancier outfits. - (Andrew Grygus) - (1)
                                     you sure? looks like a shriners convention -NT - (boxley)
                         More on the structural problems facing Greece: - (pwhysall) - (13)
                             Yeah, if only Syria had not won the election, then the Banksters would have fixed everything... :-/ -NT - (Another Scott) - (12)
                                 So what's your solution? - (pwhysall) - (11)
                                     Excluded middle ... but you know that, right? - (drook) - (10)
                                         OK, how do you do that? - (pwhysall) - (9)
                                             You broke it, you bought it - (drook) - (8)
                                                 This. - (Another Scott)
                                                 Why not? - (pwhysall) - (6)
                                                     I don't know that 12-step programs work on social psychology - (drook) - (4)
                                                         Or we could just keep right on tipping money into their economy - (pwhysall) - (3)
                                                             Oh, I see, you just make up convenient "facts." - (mmoffitt) - (2)
                                                                 Whev - (pwhysall) - (1)
                                                                     Re: EZ countries should just keep right on paying. - (mmoffitt)
                                                     Right. - (mmoffitt)
         Krugman: The Reverse Corleone - (Another Scott) - (4)
             Re: "they made Tsipras an offer he can’t accept" - (a6l6e6x) - (3)
                 Sure you can. At least for a while. - (crazy) - (1)
                     :-) -NT - (boxley)
                 Yeah. Who do they think they are? Wall Street Bankers? -NT - (mmoffitt)
         Greece blinked - (crazy) - (2)
             It's really hard to know who's giving the straight story on this stuff. - (Another Scott)
             They are literally playing games. - (a6l6e6x)
         Good article on monetary policy and why the euro was doomed from the start - (crazy)
         Piketty (and others) open letter to Frau Merkel. - (mmoffitt) - (1)
             Puritanical visions of comeuppances (visited on anonymous Others) ..not just the Murican schadenfreude - (Ashton)

I bellied up to the sandbar, and he poured me the usual: Rusty Snail, hold the grunion, shaken, not stirred. With a peanut butter and jellyfish sandwich on the side - heavy on the mako.
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