For many, the fate of Greece is a tale that foretells their own future. Many European nations look worryingly at Greece, who has been given billions in aid, but forced to adopt draconian measures that have all but destroyed the country's ailing economy.
As Greece prepares for a further handout, it will also have to adopt even more drastic measures. How that will play out for the already beleaugered population is a question most do not have the courage to answer. Some families have been forced to cut down their own trees to warm their house in the winter, as heating costs are now all but out of reach for the less than rich.
Meanwhile, the Greek government is selling wholesale much of its real estate, sparking fears of loss of traditional patrimony and security with it. The national gas company will go on the block later this year, while airports and marinas are up for grabs.
As the debt 'haircut' seems to be more of a reality each day, debtor countries like Germany could be left in the lurch. Greece has already been slated to received almost 300 billions in aid money, much of it coming from Germany.
But Germany is resisting such debt trim, mostly because they fear that if Greece is given a respite from its debt load, it might forget to implement those austerity measures and go back to its less than fiscally conservative ways.
Still, the debt is shrinking, if only by a paltry 4% a year. But is this enough, when the people of Greece are becoming desperate?
While the EU principals are claiming success, there has to be some recognition of a point of convergence between Greece's ability to lower its debt and the complete annihilation of the spending power of its citizens. When the two do meet, and they very well might, Greece's ability to lower its debt may all but vanish.
People are starting to commit suicide, among other things, in the streets of Athens. 64% of young people are unemployed, a catastrophic level in any country. Household income has all but halved, leaving people destitute or struggling to put food on the table.
One of the things that has not changed in this austerity program is the shameful tax exemption of some of Greece's richest citizens. One of the examples is the shipping business. Their massive revenue is totally, and legally, tax exempt.
Without such contribution from wealthy enterpreneurs, the burden is borne solely by the middle and lower class. In truth, no one can believe that such an arrangement can drive a country out of debt.
This is because powerful lobbying groups, just like in the United States have corrupted politicians and officials to grant them privileges that are bankrupting the country.
In many sense, the greatest flaw of the Greek democracy is its labyrinthine bureaucracy. But that said, tax evasion is or was its greatest enemy. That said, the burden of taxation implemented through the austerity program does nothing to stop the rich from tax evasion, legal or otherwise, it simply shifts the burden to those people who have no protection for overtaxation, and can ill afford to be targeted.
Another problem, evident in Italy and other European countries, is the redundancy of civil servants' position and offices. Many of them were created as a favor, and likewise, the position was assigned through nepotism or outright corruption. This kind of system breeds incompetence and arrogance, but mostly entitlement.
The unfortunate thing is that the austerity program has done nothing to remove these positions, although a trim of 150,000 positions has been scheduled for next year, but in a country with millions of civil servants, the trim might not be enough.
While the potentates at the center of the EU government debate fiercely on theories and propositions to get Greece out of its quagmire, the impoverished country hobbles along on the same maimed two feet it always had.
Partial source : Spiegel online/ 7.10.13
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