I was going to blog on the Greece referendum but events have been moving so fast that every few hours I would of had to of changed my blog.
I can't blame Greek PM George Papandreou for wanting to hold a referendum. It's his attempt to make something happen and to give the people a voice and a democratic choice in a country which has seen so much unrest and anger.
The Greek people never wanted to join the euro and were never given a choice by their political elite. Greece was able to use the power of the euro to borrow cheaply and that they did. But all this was false.
So what now. Would a government of national unity really help. I would be willing to bet it would only prove to the Greek people that the politicians are all the same.
The Greeks are playing for the mistakes of their leaders and for the control and pressure being placed on them by France and Germany for their own ends.
The sooner Greece and leave the euro the better for them because even if they are saved this time. the currency is not right for them or their economy. It never was.
Good luck Greece.
As a frequent visitor to Greece, I knew that many Greeks went out of their way to 'avoid' paying taxes. The books the leaders presented in order to join the Euro showed what they should have been bringing in, not what they were really collecting. The worst thing was that not only was the Greek political elite prepared to 'adjust matters' in this way, the other Euro leaders knew it was being done, even connived at it. Sarkosy is right to say Greece should never have been allowed to join the Euro but the wealthier countries knew that at the time.
ReplyDeleteWe should remember that on the w/e the co-alition agreement was forged, the UK owed more than Greece, Italy & Portugal combined, we still owe more than Greece; so thank God the coalition happened and we managed to survive... for the moment.
Yes it's credit to the agreement that our countries bond rates are so low. Imagine the cuts needed if the uk paid 6percent interest on its bonds.
ReplyDeleteThe biggest lie that has been accepted as the truth from all the media and has become a "fact" is that Greece lied to get into the euro. This is based on two accounting practices:
ReplyDelete1. The infamous Goldman-Sachs deal that "masked" the dept. The dept that was "masked" (correct word would be "postponed") was a couple of billion, i.e. peanuts in the grand scheme of things. It was one more action to bring the numbers into alignment in order to enter the euro, together with austerity measures and higher taxation. Was it illegal? NOT AT THE TIME. In fact it was perfectly legal and other countries did exactly the same thing. It would surprise you to hear which ones, look it up. Of course, it is not permitted now as the EU boffins plugged this loophole.
2. In 2004 the concervatives won the election in Greece. Hungry from years out of government and shady deals they started with the biggest purchase of military equipment in years, namely fighter aircraft. However, because their budget was short of a few billion they elected to "borrow" money from the past after a general audit. To understand how you have to understand how military purchases work. You don't just go to the fighter aircraft supermarket with a bag and stuff it with eurofighters and F16s, you have to make the order and then get deliveries for years where you pay what is delivered. So when in 2000 a large order of military equipment was made the expense was written into future budgets, when the payment was meant to be made. The new government decided that the order should be written in the 2000 budget instead, giving it a few years of more money to buy stuff with (with a hansome cut for the politicians). The matter is a bit more complex but basically this is what happened.
Now, did the rest of the eurozone know what was going on? Of course they did. For the Goldman-Sachs deal they couldn't say anything since big "core" countries used the same trick. For the audit trick, they pretty much kept their mouths shut because they were the sellers of the military equipment and if the deal didn't go through they stood to lose millions. Of course, in true Macciavelian fashion the concervative goverment played them for chums and went and bought F15s from the US instead.
Why is the lie perpetuated together with others of "lazy greeks" that never pay any taxes, get bonuses for getting up in the morning and retire before they finish highschool? Because if the eurozone is afraid that if it admits that the problem is endemic the markets and the euro are going to crash. The worse the image of the Greeks, the bigger the difference between them and "nice" countries like Italy (smirk). And of course now that the cat's out of the bag the politicians of the affected countries cannot admit they were idiots and have found the perfect people to blame - it's the Greeks!
I remember a few years back I asked a Greek friend why he was happy that Greece entered the euro. He told me that there is a lot of hope that within a common currency the other partners in the eurozone will help eliminate political corruption since it was in their interest. It seems that their short-term interest was to use the political corruption to sell Greece overpriced stuff and get paid with money they were lending her. And now that the fit hit the shan their short-term interest is to drag Greece into the mud to divert the attention away from their own failures.
Coming soon to a country near you, perhaps yours!
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