June 29, 2011
Spoiled Brats in Greece
This is what happens when the bill comes due for huge government benefits that you've voted for yourselves:
People develop an entitlement mentality. We think we've seen it here in the U.S., but it's just kids stuff compared to the full-blown version. From an AP story in today's Washington Times:
Greece fended off a bankruptcy that threatened to roil global financial markets, approving severe spending cuts and tax increases Wednesday in the face of violent protests by Greeks who say they have suffered enough.
The package of austerity measures would keep bailout money flowing to Greece from the rest of the world. It would free $17 billion in fresh loans, although the money will only be enough to see the nation through September.
Investors around the world cheered the news, but protesters, fighting tear gas, hurled whatever they could find at riot police and tried to blockade the Parliament building.
"This is bad. The country will be sold for a piece of bread," said insurer Dimitris Kostopoulos. "There were many other more appropriate alternatives to this. Parliament has once again betrayed us."
Public sector salaries and pensions have been cut in the past year, and unemployment is above 16 percent. By comparison, it is about 9 percent in the United States.
Parliament approved $40 billion in tax increases and spending cuts, and privatization of public services to raise $71 billion more, all through 2015. Greece's overall economic output is about $330 billion, or roughly the size of Washington state's.
The $17 billion in loans are the latest batch in a $157 billion bailout by the European Union and the International Monetary Fund. Parliament is expected to pass another bill Thursday to implement the austerity measures.
Without the bailout money, Greece was at risk of default. While no one knows for sure what would have happened next, analysts have said it would have threatened the viability of the euro, the European Union's common currency, and could have done much worse.
Some market experts had predicted a Greek default could have triggered another world financial meltdown, like what happened after the Lehman Brothers investment house collapsed in 2008 in the United States.
The risk is that banks, both in Europe and the U.S., would have had to chalk up billions of dollars in losses because of Greek loans that had gone bad. No one knows which U.S. banks hold what amount of Greek debt.
Several banks and storefronts were smashed, while a Socialist dissenter who backed the government at the last minute, Alexandros Athanassiadis, was briefly assaulted by protesters after leaving Parliament on foot.
Violence continued throughout the afternoon, and smoke billowed from a post office beneath the finance ministry before a fire was put out. Rioters set up burning barricades along Syntagma Square, where demonstrators have staged a sit-in for the past month. Nearby streets were littered with chunks of smashed marble and ripped-up paving stones that had been thrown at police.
A general strike that began Tuesday paralyzed the country, grounding planes, leaving ferries docked and stranding tourists during the busy summer season.
By Wednesday night, police said 49 officers had been injured, one seriously when he was hit in the face by a chunk of marble. Forty-three protesters were detained, with 17 of them arrested. Emergency services said they had treated 99 protesters and passers-by for injuries.
Dozens of injured were treated at a first-aid center set up inside the square's metro station. Most were treated for breathing problems, contusions and broken bones, volunteers at the first aid center said, appealing for medical supplies.
Is this a preview of what is to come in other Western countries?
Posted by Tom at June 29, 2011 9:30 PM
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The interesting thing is that Greece, as well as many of the other regions in southern Europe, offers problems both progressive and conservative can dislike. To add to the fact that Greeks indignantly demand bloated civil services payrolls and benefits packages, they are also some of the developed world's worst tax cheats as a whole.
Googling "tax evasion" and "Greece" will offer a wide array of stories about how all types of Greeks skip out on paying their taxes- from both liberal and right-leaning sources. Corruption probably also constantly bleeds government coffers, requiring a constant infusion of credit to maintain the status quo.
Listening to media reports from Greek, I am struck by how clueless Greeks themselves sound. They blame foreigners, bankers, the IMF, the Illuminati, or anyone else other than themselves. Germans, of course, grumble about bailing out these slackers. Like too many voters around the world, they demand a trough of benefits and have a tantrum when they are asked to pay for them.
Posted by: jason at July 2, 2011 8:21 AM
The Nanny State path that many European nations have been traveling for some decades is unsustainable.
And the economic path here in the United States is likewise unsustainable. I do expect outbreaks of violence here in America as "the entitled" realize that their entitlements won't be available after all.
Posted by: Always On Watch at July 3, 2011 3:42 PM