Greek gov't bonds downgraded to junk status, Eurozone in trouble

Prime Junta · May 1, 2010

In practice, this may well be the case. However, in principle, it should not be. If Iran ever becomes a stable, reasonably non-corrupt democracy that respects human rights, treats its neighbors decently, and is economically robust enough to make it in the free-trade zone, they're more than welcome.

Requiring a cultural or historic congruence isn't attractive to me. That's just about tearing down some low walls in order to erect a new, higher one, whereas I want to tear them all down. However, I recognize that this is not something we can do all at once, and attempting to do it too fast would only result in tragedy.

That's why, in the interim, I think our policy should be to help anyone who wants to turn their country into a stable, prosperous democracy respecting human rights etc. etc. — while recognizing that that's not something we can force on anyone, and that most of the time the best we can do is not stand in the way of such developments. Forcing the pace, whether it's the American way through military intervention or the European way by too-fast integration will only make things worse.

magerette · May 1, 2010

Dragging in America, again, since that's my principal frame of reference, I think a lot of the problems the US faces as a democracy, and that at least individual European countries tend to experience less, are related to a lack of cultural congruence as well as a historic divergence between North and South, going back to the original 13 colonies and the very different groups that formed them, not to mention the 'salad bowl' of recent world-wide immigration trumping the traditional 'melting pot' of European-based immigration. The more diversity we have, the more polarized our society and our politics seems to become.

I do agree, though, that having an open mind about who participates in a primarily economic/diplomatic union of countries not based on any purely cultural criteria is probably the ultimate way forward, not just for you guys, but for everyone. It just seems like something for the remote future at this moment in time.

dteowner · May 1, 2010

Re: Non-geographic EU…Why did you leave the US out of that list? Do we not meet the membership criteria?

edit- to Mags' first paragraph, directly above: Amen. I don't care for the "salad bowl" approach in the slightest, and blame it for more than a few things.

Prime Junta · May 1, 2010

magerette said:
I do agree, though, that having an open mind about who participates in a primarily economic/diplomatic union of countries not based on any purely cultural criteria is probably the ultimate way forward, not just for you guys, but for everyone. It just seems like something for the remote future at this moment in time.

It probably is. Then again, you never know. When I was growing up, there were a few things that seemed certain and permanent. There was the USSR. There was the Berlin wall. There were the Arabs and the Israelis. There was the Chinese Communist Party. There was famine in India.

The Arabs and the Israelis are still with us, but the USSR is gone, the Berlin wall is reduced to a few graffitoed blocks standing as tourist attractions, the Chinese aren't Communist anymore except in name, and the Indians are busily producing software.

Some things take a very long time to change. Some things change almost overnight, once they're ripe, and it's very hard to tell which is which.

Prime Junta · May 1, 2010

dteowner said:
Re: Non-geographic EU…Why did you leave the US out of that list? Do we not meet the membership criteria?

Well, you don't, as a matter of fact (you have the death penalty; the EU doesn't allow it), but neither does Congo, Israel, Russia, or Iran.

It wasn't a list; it was an illustration of my position that no country should be excluded because of geography, culture, or history; what matters is that it meets the entry criteria *now* -- and that those criteria are tough enough to make the exercise workable.

Prime Junta · May 1, 2010

BTW, I hate to admit to being so petty, but what particularly irritates me about the Greek riots are the "EU commission out! IMF out!" slogans.

News flash: the EU commission and the IMF didn't bankrupt you. You did that all by yourself.

I mean sure, the bailout is out of self-interest as well -- it is in the EU's interest to stave off a complete collapse of the Greek economy and polity, if for no other reason than that millions of economic refugees would be a royal PITA, but things would be far more painful without that 120-billion cash injection. But if you'd rather have it that way... :shrug:

Gorath · May 1, 2010

120B€ is on the lower end of the projections. I've seen them go as high as 200B€. Chances are low to get even half of that back.

Some experts fear that the Greek government will agree to a lot of things, but then in a year or so say "we can't implement it - look at the protests, we're on the brink of a civil war".

What Greece really needs is a restructuring like Germany after WW2. Won't happen though.

Prime Junta · May 1, 2010

I believe in second chances. I think the Greeks deserve one. We can afford this, and not trying would certainly lead to a whole mess o' trouble.

But if that happens, I'm for pulling the plug... and for figuring out how to kick countries out of the EMU and the EU.

magerette · May 2, 2010

NYT has the news a bailout agreement has been reached:
http://www.nytimes.com/2010/05/03/business/global/03drachma.html?hp

and about the tax dodging:
http://www.nytimes.com/2010/05/02/w...nytimes.com/pages/business/global/index.jsonp

Prime Junta · May 2, 2010

Good article (the second one). Still, this bit illustrates a pretty big problem:

Soon, Mr. Plaskovitis said, people will see results. “In the coming weeks,” he said, “we are going to be closing down companies, restaurants and doctors’ offices because they have not paid taxes.”

That will make an already awful slump much worse. Yet it's really tough to avoid. You can't crack down on tax evasion without seizing assets. Yet seizing assets will put people out of work and cause them to hide their assets either in the gray economy or abroad, and the collected taxes will be passed onto prices, which will make money tighter and further depress the economy. It's a vicious spiral.

Greece is really like the proverbial magpie stuck on a hot tarred roof -- pull the tail free, and the beak gets stuck.

The other thing worth noticing is that responsibly run national economies don't get into this situation. They have enough cushion (in actual cash reserves, assets, or just the ability to raise more taxes) that they can ease policy during a downturn and make up for it later.

Some credible estimates are saying that Greece may regain its 2008 GDP in... 2017. That's a lost decade.

Govern responsibly, folks. The alternative isn't fun. And no, it's not about small government versus big government; it's about responsible government versus irresponsible government. It's just as easy to run a night-watchman small government into the wall as a social-democratic big one, and the consequences will be just about as dire, although for different reasons. Rob Mugabe's government was a pretty small one, and it ran Zimbabwe into a very, very deep hole indeed.

akarthis · May 2, 2010

*sighs* here we go,

Today the goverment announced the new measures.Not what i expected but i am sure more will come at the end of summer.

About the pension at the age of 53 you are right.Though it was for some specific categories(police officers) and mostly for women(mothers). Totally wrong and the faster it changes the better.
About the bonuses again you are right.CUT them all!!!!the best bonus was the "bonus for early entrance at the service". Where can you find such a bonus,right??

About the military badget,here you are wrong.It is one of the biggest in Europe but it was created by the pressure of the USA,Germany, Russia and France.They sell us weapons.The same goes for Turkey. You know we had to buy a German submarine that was malfuctioning?I hope they let us to cut the badget.

About the money you estimated you are giving, well i wish i could take them and send it back to you.The thing is i will be giving more and i am sure you know that noone gives money for free.
It's silly to believe that Greece has a debt of 350 billions and they are giving us 120 more.Of course there is not a chance to give them back.Other agreements and plans are behind that.

About the riots,don't get ungry.It's just typical left wings slogans.No one takes them seriusly. The slogan that trully is meaningfull and it's accepted by everyone is : Send them to jail (politicians)

Last, about the tax evasion.Here is the most difficult issue and i am really interested to see how can the goverment can face it. I am not confident it will. The corruption is so deep,you can't even imagine. I am working as a financial manager in a company and i have a lot of experience about that. No matter how correct you are,even if you pay your taxes to the last cent, making no mistakes at your book keeping, when the tax service visits you, you know you have to pay them, no matter what. So you end up stealing.

I am sorry for the big post.

Gorath · May 3, 2010

akarthis said:
The corruption is so deep,you can't even imagine. I am working as a financial manager in a company and i have a lot of experience about that. No matter how correct you are,even if you pay your taxes to the last cent, making no mistakes at your book keeping, when the tax service visits you, you know you have to pay them, no matter what. So you end up stealing.

I've read an article in Bild which described the situation. They wrote that in certain sectors it's impossible to get anything done without baksheesh. You need help by a doctor or important official papers? You either have a lot of patience or you hand them an envelope with cash. Also, qualified jobs are impossible to get without connections. Even the prime ministers are usually members of only 2(!) families, with an outsider once in a while.

Tragos · May 3, 2010

With the new measures government expects to earn like 1.3b more this year, they could have those money if their didn't spent them buying French missiles only few months ago.

I lol with northern Europeans being all critical , i will not go to who got bribed (you know EU commissioners had an eye over all spending of union's money hehe ) i am just thinking that with PIIGS out who the hell will buy your industrial production?
Only few months ago German and French cars were almost tax free so we could lay a hand on their failing auto industry.

Ah and we will revolt against everything

Prime Junta · May 3, 2010

Tragos said:
With the new measures government expects to earn like 1.3b more this year, they could have those money if their didn't spent them buying French missiles only few months ago.

I lol with northern Europeans being all critical , i will not go to who got bribed (you know EU commissioners had an eye over all spending of union's money hehe ) i am just thinking that with PIIGS out who the hell will buy your industrial production?
Only few months ago German and French cars were almost tax free so we could lay a hand on their failing auto industry.

Ah and we will revolt against everything

Oh fuck off, Tragos. If you weren't so busy playing at revolutionaries and evading taxes, none of this would have happened. You call yourself a critical thinker, right? Then why not look at a few numbers instead of spouting two-penny conspiracy theories:

German exports: about 1.1 trillion €
German exports to Greece: about 8 billion €

8 billion / 1.1 trillion: 0.7%

Yeah, if Greece got wiped off the map, that would surely cripple the German economy.

Second, the money you had to account for to EU commissioners wasn't the problem. You didn't get any special money; you got the same stupid subsidies everybody gets. Of course, you put more effort into gaming the system and were a net recipient of subsidies rather than a net payer, like us naive folks in the North, but in principle the rules are the same.

(Okay, it was *A* problem — EU agricultural subsidies suck, but that's another story. It had exactly *nothing* to do with your stupid-ass crisis, though.)

The problem is money your government borrowed off the market at very low rates they got by lying their way into the Eurozone.

Nobody "has an eye" on any of that, or forces you to borrow it in the first place. Sure, you *CAN* choose to do it, just like you *CAN* choose to bribe people to believe your lies, or accept bribes from French missile merchants or whatever. But going "WHAAA! They made me do it!" afterwards is beyond ridiculous.

So yeah, Tragos, you hit the nail on the head. You *are* revolting.

Tragos · May 3, 2010

Prime Junta said:
Oh fuck off, Tragos. If you weren't so busy playing at revolutionaries and evading taxes, none of this would have happened. You call yourself a critical thinker, right? Then why not look at a few numbers instead of spouting two-penny conspiracy theories:

With an income of 13.000€ there is no reason to evade , government does keep 650€ from my wages anyway .

Prime Junta said:
German exports: about 1.1 trillion €
German exports to Greece: about 8 billion €

8 billion / 1.1 trillion: 0.7%

Greece has a trade deficit with Germany that reaches 6b , the amount of money we take annually from EU , also Germans own about 35% of Greek business ….mostly previously public owned enterprises , money generating ones like OTE …

Prime Junta said:
Second, the money you had to account for to EU commissioners wasn't the problem. You didn't get any special money; you got the same stupid subsidies everybody gets. Of course, you put more effort into gaming the system and were a net recipient of subsidies rather than a net payer, like us naive folks in the North, but in principle the rules are the same.

Spare me the crap euro was created ensure that Europe will become a German village , you naive folks bribed the shit out of everyone unless you wanna go blind on how much SIEMENS and DAIMLER scandals cost to our public.

Prime Junta said:
The problem is money your government borrowed off the market at very low rates they got by lying their way into the Eurozone.

We lie? you may wanna do a research in how many EU countries are artificially hold their GNP down.

Prime Junta said:
Nobody "has an eye" on any of that, or forces you to borrow it in the first place. Sure, you *CAN* choose to do it, just like you *CAN* choose to bribe people to believe your lies, or accept bribes from French missile merchants or whatever. But going "WHAAA! They made me do it!" afterwards is beyond ridiculous.

Our lies ? you think this will have any effect if EU commissioners were untouchable ? and the missiles case is a bit deeper , mostly like a blackmail related to NATO summit in Romania.

S

Prime Junta said:
o yeah, Tragos, you hit the nail on the head. You *are* revolting.

Wait and see

Prime Junta · May 3, 2010

Tragos said:
With an income of 13.000€ there is no reason to evade , government does keep 650€ from my wages anyway .

Yeah, that's what they all say. I hear that strangely almost nobody makes more than 13,000 € in Greece. Funny, eh?

Greece has a trade deficit with Germany that reaches 6b ,

...which is almost 0.5% of German exports, as I pointed out above...

the amount of money we take annually from EU ,

...as agricultural subsidies etc., which (a) everybody else gets too and (b) have nothing to do with your crisis....

also Germans own about 35% of Greek business

They must really be slapping each other on the back at those investments, eh?

….mostly previously public owned enterprises , money generating ones like OTE …

And?

Spare me the crap euro was created ensure that Europe will become a German village , you naive folks bribed the shit out of everyone unless you wanna go blind on how much SIEMENS and DAIMLER scandals cost to our public.

You spare me the childish paranoia. Grow up, Tragos. You've been amusing to have around here, but this is getting a bit too much. If it was up to me, Greece would never have been admitted to the EU, let alone the eurozone -- you have much more in common economically, politically, and even culturally with Turkey or Albania than with Germany or France.

We lie? you may wanna do a research in how many EU countries are artificially hold their GNP down.

Yes, you fucking lie. You lied 10 percentage points off your government deficit/GDP ratio. That's not a little fib, that's a real mothership of a lie. What anyone else in the EU does (with the possible exceptions of Bulgaria and Romania) are minor embellishments in comparison.

Our lies ? you think this will have any effect if EU commissioners were untouchable ? and the missiles case is a bit deeper , mostly like a blackmail related to NATO summit in Romania.

Yeah, boo-hoo, waah! waah! it's the ebul Nazi Germans that made you borrow all that money and keep those Athens Olympics and appoint those commissions for maintaining lakes that dried up eighty years ago and set the retirement age to 53 and give office workers bonuses for showing up at the office and spend more on the military than anyone else in the EU (in case your NATO allies, the Turks, invade). You're not responsible AT ALL, it's everybody else's fault.

No, wait. It's YOUR fault, and if you're now a ward of Germany (as you are), that's entirely YOUR doing. Do you really think Germany *wants* a welfare case like you sucking on their teat? Get outta here! Angela Merkel is going to lose the upcoming elections because of you. If it was up to the Germans, they'd cut you loose in no time flat.

Wait and see

Yeah, I am. Eagerly.

Fuck, I'm finding my little inner right-wing populist here. I actually laughed when ours -- Timo Soini -- suggested that he's quite ready to bail your lazy, corrupt asses out, as long as we get some collateral for it. He suggested Rhodes. I'd roll with that.

Tragos · May 3, 2010

Prime Junta said:
Yeah, that's what they all say. I hear that strangely almost nobody makes more than 13,000 € in Greece. Funny, eh?

Thats how many the average Greek makes , believe it or not

Prime Junta said:
They must really be slapping each other on the back at those investments, eh?

Greek telecom owns half the Balkans and it was bought on a bargain price

Prime Junta said:
You spare me the childish paranoia. Grow up, Tragos. You've been amusing to have around here, but this is getting a bit too much. If it was up to me, Greece would never have been admitted to the EU, let alone the eurozone — you have much more in common economically, politically, and even culturally with Turkey or Albania than with Germany or France.

How our admission to Eurozone was any good for us?
Don't try speaking of matters you do not understand , also i do understand Fins be sociopaths , 6 months of darkness is like working in a fucking mine .

Prime Junta said:
Yes, you fucking lie.

Who didn't?

Prime Junta said:
Yeah, boo-hoo, waah! waah! it's the ebul Nazi Germans that made you borrow all that money and keep those Athens Olympics and appoint those commissions for maintaining lakes that dried up eighty years ago and set the retirement age to 53 and give office workers bonuses for showing up at the office and spend more on the military than anyone else in the EU (in case your NATO allies, the Turks, invade). You're not responsible AT ALL, it's everybody else's fault.

I guess you have no idea of what you are talking about and what happens when either us or Turkey refuse to buy weaponry .

Prime Junta said:
No, wait. It's YOUR fault, and if you're now a ward of Germany (as you are), that's entirely YOUR doing. Do you really think Germany *wants* a welfare case like you sucking on their teat? Get outta here! Angela Merkel is going to lose the upcoming elections because of you. If it was up to the Germans, they'd cut you loose in no time flat.

My sympathies to the Afghani civilians bomber for losing the elections , also for books cooking you have to speak with some people residing in Brussels

Prime Junta said:
Fuck, I'm finding my little inner right-wing populist here. I actually laughed when ours — Timo Soini — suggested that he's quite ready to bail your lazy, corrupt asses out, as long as we get some collateral for it. He suggested Rhodes. I'd roll with that.

Planning an escape from your mine ? hahahaha

Prime Junta · May 3, 2010

Tragos said:
Thats how many the average Greek makes , believe it or not

News flash: I don't.

Greek telecom owns half the Balkans and it was bought on a bargain price

Not the BALKANS? Wow. Sounds like a real bargain.

How our admission to Eurozone was any good for us?

IT WASN'T! See, the Eurozone is good for countries who are actually capable of governing themselves, not corrupt tin-pot Balkan olive-oil republics. If it was up to me, I'd never have let you in — but then it wasn't, and then I didn't submit the application, did I now?

Don't try speaking of matters you do not understand , also i do understand Fins be sociopaths , 6 months of darkness is like working in a fucking mine .

Yeah, it's very remiss of us not to adjust the Earth's tilt a bit to take care of that.

Who didn't?

We didn't.

I guess you have no idea of what you are talking about and what happens when either us or Turkey refuse to buy weaponry .

Yeah, the USA and France immediately make a joint cruise-missile strike on Istanbul and Athens.

My sympathies to the Afghani civilians bomber for losing the elections , also for books cooking you have to speak with some people residing in Brussels

And not anyone in Athens? Geez, Tragos — you really *are* good at shifting responsibility, Mr. 13-grand-a-year man.

Planning an escape from your mine ? hahahaha

Well, we sure as hell would take better care of it than you do.

Seriously: Germany isn't the problem. The EU isn't the problem. YOU are the problem. When you joined the EU and then the Eurozone, you had a choice to make. You could have used the stability and easier access to markets afforded by the common currency to look for sound business opportunities. Instead, you used it to look for corruption opportunities. Surprise surprise, you found those opportunities and exploited them to the hilt, and here you are now.

Because the problem is with your inability to govern your way out of a wet paper bag, not to mention keeping your greasy little fingers off corruption opportunities, you would not be any better off outside the EU and the Eurozone. That'd just make you a Serbia, Albania, or Macedonia, or maybe Tunisia or Morocco.

Despite everything, the EU *is* a relatively even playing field, and the best thing you can say for it is that despite its many problems, countries that behave responsibly in it tend to prosper in the long term, no matter where they start. Slovenia, Poland, and Finland are doing pretty well for themselves. Romania, Bulgaria, and Greece, not so well. The difference isn't in structural factors like size, level of education, technology, culture, or demographics; it's in the quality of government and overall integrity of society. Corrupt, badly governed countries get run over or taken over. Non-corrupt, well-governed counties do the taking-over. What's more, the corrupt, badly-governed countries will get taken over anyway, wherever they are — just ask Nigeria or Afghanistan. The only difference is that with you in the EU, your problems suddenly also become our problems, and I find myself sending you a grand of my money in a little brown envelope. *That* sucks, and if there was a way to kick your hairy asses out without that costing us even more, I'd do it.

And yeah, I think we will be more careful about who we let in, and when, in the future.

Edit: Oh, and about those military expenditures of yours? I just found out that 80% goes towards "administrative expenses." I wonder what those might be?

IOW, those French missiles barely even register. You have an army of corrupt clerks, not people who could actually, y'know, repel a Turkish invasion. (The Turks have an actual army, you see -- capable of fighting and winning actual wars.)

GothicGothicness · May 3, 2010

I think Greece should be really happy they are in the EU and euro zone. I think banks in general and german banks in particular would be much less willing to save them if they had been out of the EU and euro......

I thought to the greece people who protest, and think they should be able to retire at 53... well welcome to the real world? and I hope EU will carefully monitor Greece in the future to make sure they'll not try to corrupt their way out of this one.

akarthis · May 3, 2010

Hey hey, chill out people.
We should all understand it's all politics games.
First and above all we, Greeks, should first realize it's our fault because we let this happened.
We could, cynically say, and i am sure many do, "you fools, you let us in, now you pay. we spend, you pay. Now,who's the dump?"

But that is not the point.
About the salaries,it's a reality. In the private sector the average is 13000 Euros.

About the military badget,we are hardly pressed by the countries i mentioned above.

Greek gov't bonds downgraded to junk status, Eurozone in trouble

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