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Their is a lot wrong with what you say. Clearly you are not up with current historical studies on the 'Treaty of Versaille'. The treaty was actually not particu

by nickik 10y ago

Their is a lot wrong with what you say. Clearly you are not up with current historical studies on the 'Treaty of Versaille'. The treaty was actually not particularly hard or in any way impossible to mean by Germany. If Germany had better leadership they could easily have moved passed it and be the most wealthy nation again. What they are doing to Greece is actually much worse then Versaille. It has to do with the issue that Greece should have defaulted years (I was arguing this even in 2008) and change their government. Because of EU (EMU) logic this can not happen. So Greece is forced to change its government in the context of huge debt and even worse a flat demand curve (look at EU NGDP and Greece NGDP). Greece is about the only country that actually did significant Austerity but its not working. The EU should have let them default or take over their debt completely. You are probably right that PR is the main issue. It was with 'Versaille' as well. German government PR is the main reason why you use 'Versaille' as an example of evil practice. Maybe the most successful example of PR in the last 100 years.

cygx 10y ago
If Germany had better leadership they could easily have moved passed it and be the most wealthy nation again. Germany actually was on the road to economic recovery when the Great Depression hit.
- nickik 10y ago
  That is a vastly oversimplified story. Germany actually did really good after WW1 until the Government escalated the inflation in a deliberate attempted to get a better deal. When they got that deal they again grew really well under the economic leadership of some smart economists. Then the Great Depression hit and Germany, wanting to stay on gold, got hit really hard. By 1934-1935 they overcame the shock and Hitler earns the credit. Fantastic book on this stuff: - The Deluge: The Great War, America and the Remaking of the Global Order, 1916-1931
deleted 10y ago
[deleted]
Retric 10y ago
Greece did not do meaningful Austerity, they let their debt continue to snowball and continued to spend more than they where taxing. http://www.statista.com/statistics/275335/government-revenue-and-spending-in-greece/ http://www.statista.com/statistics/275335/government-revenue...
- ethbro 10y ago
  Isn't that exactly what Keynesian economics would predict if a country launched "meaningful" austerity? Without external input, decreased spending would decrease demand, which would decrease output, which would reduce the expected revenue:spending increases from the initial spending cuts, which would require further spending cuts to hit ratio targets, etc etc.
  - Retric 10y ago
    Magnitude is important. If government spending is say 40% of GDP and it drops to 20% GDP then the drop in revinues is not 50%, but closer to 20%. Importantly for a country used to borrowing every year living within their means will seem like a huge sacrifice even if it's not optional. The further drop to paying down debt is even further, but it's that or default. And no you can't grow the economy with stimulus spending when you got used to decades of stimulus spending in the first place.
    - emn13 10y ago
      Clearly you can't reasonably expect spend more than you earn with a reputation for defaulting on loans. However, it's debatable to what extent debt downpayment is requirement. The risk of default is part of the deal a creditor takes on.
      - Retric 10y ago
        If the intent is to never pay the money back then it's not a loan.
Annatar 10y ago
> Greece is about the only country that actually did significant Austerity but its not working. Greece did not do any austerity; just like the Croats, the Greeks lived on debt and piled up more and more... and I watched some hidden camera documentaries on Greece (VICE comes to mind), that secretly filmed how nobody in Greece issues one a receipt upon payment, basically eschewing paying taxes and committing tax fraud... on a systemic and massive scale... why? Because Greece has a corrupt government, so the citizens want to "stick it to the man". Why does Greece have a corrupt government? Because they tolerate one, and the guys which replaced them, and the guys which will replace them, will be just as undisciplined and just as corrupt. Meanwhile, German citizens were footing Greeks' systemic embezzling through German taxes and by German government fiat; and now all of a sudden when the Germans demand Greeks pay back their debts, you think it's okay to default? It is not okay to not pay one's debts. That's German citizens' money. They didn't embezzle, they pay their taxes, they work hard, they save, and they deserve to have their loans paid back. How would you like it if you lent someone money, and they purposely defaulted, with the intent of not paying you back? > The EU should have let them default or take over their debt completely. No! That would mean Greeks would have lived on someone else's labor and walked away with financial and material gain scott-free, or supported corruption by people who did. That is not okay!
- maze-le 10y ago
  > How would you like it if you lent someone money, and they purposely defaulted, with the intent of not paying you back? By not lending this person any money in the future... A default has very harsh consequences and is not pleasant at all, but it is a normal process in capitalism. It happens all the time, everywhere. This is why banks make risk assessments (normally). > It is not okay to not pay one's debts. That's German citizens' money. No its not. Its german banks money, they made the wrong decision in lending money to an untrustful debtor. German tay payers money only came into play when the state worked out the 'rescue packages' for greece. These 'rescue packages' were only meant for the greece government to pay back the banks. About 90% of the money given to greece goes directly into the debt-payback. So if anything german tax payers are financing the flawd descision making process of 'Deutsche Bank' and others. And about the level of corruption in greece. Yes it exists, and is systemic. But so are the shady deals of Bilfinger Berger, the whole Berlin Airport-farce, the quicksand investments of the Landesbanken and virtually every public building project conducted in germany.

by nickik 10y ago

cygx 10y ago

If Germany had better leadership they could easily have moved passed it and be the most wealthy nation again. Germany actually was on the road to economic recovery when the Great Depression hit.

nickik 10y ago
That is a vastly oversimplified story. Germany actually did really good after WW1 until the Government escalated the inflation in a deliberate attempted to get a better deal. When they got that deal they again grew really well under the economic leadership of some smart economists. Then the Great Depression hit and Germany, wanting to stay on gold, got hit really hard. By 1934-1935 they overcame the shock and Hitler earns the credit. Fantastic book on this stuff: - The Deluge: The Great War, America and the Remaking of the Global Order, 1916-1931

deleted 10y ago

[deleted]

Retric 10y ago

Greece did not do meaningful Austerity, they let their debt continue to snowball and continued to spend more than they where taxing. http://www.statista.com/statistics/275335/government-revenue-and-spending-in-greece/ http://www.statista.com/statistics/275335/government-revenue...

ethbro 10y ago
Isn't that exactly what Keynesian economics would predict if a country launched "meaningful" austerity? Without external input, decreased spending would decrease demand, which would decrease output, which would reduce the expected revenue:spending increases from the initial spending cuts, which would require further spending cuts to hit ratio targets, etc etc.
- Retric 10y ago
  Magnitude is important. If government spending is say 40% of GDP and it drops to 20% GDP then the drop in revinues is not 50%, but closer to 20%. Importantly for a country used to borrowing every year living within their means will seem like a huge sacrifice even if it's not optional. The further drop to paying down debt is even further, but it's that or default. And no you can't grow the economy with stimulus spending when you got used to decades of stimulus spending in the first place.
  - emn13 10y ago
    Clearly you can't reasonably expect spend more than you earn with a reputation for defaulting on loans. However, it's debatable to what extent debt downpayment is requirement. The risk of default is part of the deal a creditor takes on.
    - Retric 10y ago
      If the intent is to never pay the money back then it's not a loan.

Annatar 10y ago

> Greece is about the only country that actually did significant Austerity but its not working. Greece did not do any austerity; just like the Croats, the Greeks lived on debt and piled up more and more... and I watched some hidden camera documentaries on Greece (VICE comes to mind), that secretly filmed how nobody in Greece issues one a receipt upon payment, basically eschewing paying taxes and committing tax fraud... on a systemic and massive scale... why? Because Greece has a corrupt government, so the citizens want to "stick it to the man". Why does Greece have a corrupt government? Because they tolerate one, and the guys which replaced them, and the guys which will replace them, will be just as undisciplined and just as corrupt. Meanwhile, German citizens were footing Greeks' systemic embezzling through German taxes and by German government fiat; and now all of a sudden when the Germans demand Greeks pay back their debts, you think it's okay to default? It is not okay to not pay one's debts. That's German citizens' money. They didn't embezzle, they pay their taxes, they work hard, they save, and they deserve to have their loans paid back. How would you like it if you lent someone money, and they purposely defaulted, with the intent of not paying you back? > The EU should have let them default or take over their debt completely. No! That would mean Greeks would have lived on someone else's labor and walked away with financial and material gain scott-free, or supported corruption by people who did. That is not okay!

maze-le 10y ago
> How would you like it if you lent someone money, and they purposely defaulted, with the intent of not paying you back? By not lending this person any money in the future... A default has very harsh consequences and is not pleasant at all, but it is a normal process in capitalism. It happens all the time, everywhere. This is why banks make risk assessments (normally). > It is not okay to not pay one's debts. That's German citizens' money. No its not. Its german banks money, they made the wrong decision in lending money to an untrustful debtor. German tay payers money only came into play when the state worked out the 'rescue packages' for greece. These 'rescue packages' were only meant for the greece government to pay back the banks. About 90% of the money given to greece goes directly into the debt-payback. So if anything german tax payers are financing the flawd descision making process of 'Deutsche Bank' and others. And about the level of corruption in greece. Yes it exists, and is systemic. But so are the shady deals of Bilfinger Berger, the whole Berlin Airport-farce, the quicksand investments of the Landesbanken and virtually every public building project conducted in germany.