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Greeks are sure of one thing: they can’t trust their fellow Greeks.

157 points by surlyadopter 16y ago

Fantastic article. I can only wonder how the Greek government will move forward.

mindslight 16y ago
This entire article presumes that the Greek people are responsible for the debts of the Greek government.
- varjag 16y ago
  Well they elect the government, so yes they are.
  - mindslight 16y ago
    Having the ability to cast a vote makes one responsible for all actions of whomever gets elected, plus the entire standing government?
    - varjag 16y ago
      Voting in representative democracy is statistical quality, so no, not one in particular but a nation as a whole. Like in the USA you might not be personally responsible for Iraq war, but as an American, you are. Of course such property makes it attractive to neglect personal political responsibility. But in some situations, like with Greeks now, it can come back and bite you in the ass. (Also, read the article - it's not quite about benign populi paying for mistakes of the Government)
      - mindslight 16y ago
        To be partially responsible for something, there must be something one could have done that may have prevented it. Please tell me as an American, what I could have done that could have possibly prevented the Iraq war. I'm not asking for monumental results, but at least what would have withdrawn my alleged contribution to the war? I did read the article, and all of its prescriptions presume that the Greek people are indebted to their government. Is it not possible that the informal economy grows, the government goes bankrupt, but the society (held together by local structures) continues on?
        varjag 16y ago
        You could not do much I'm afraid, it's sad but it still holds you responsible as part of the group. May sound too harsh, but collective responsibility is acknowledged explicitly e.g. in post-war German ideology. Being taught that in schools might alone make people more considerate of their choices in general. As for the article, it suggests that Greeks despise and distrust each other in first place. Not sure it's a good starting point for anarchic type of society. Also, notice how the most vocal protesters there were the government workers (who earn triple of the private sector on average).
- jancona 16y ago
  In practice, they are, unless they can pick up and leave, taking their assets with them. (Any Greeks thinking about doing this, I suggest you do it soon.) It may not be fair, but the last paragraph of the article lays out the choices pretty well. They're all bad, and the people of Greece will feel the pain either way.
surlyadopter 16y ago
“The Greek people never learned to pay their taxes. And they never did because no one is punished. No one has ever been punished. It’s a cavalier offense—like a gentleman not opening a door for a lady.” The article makes it clear that for Greece to improve this type of behavior must change. But is it even possible for Greece to do this in the span of say, less than one generation?
- _delirium 16y ago
  I can't seem to find it, but I recall reading a piece at one point that suggested the general disregard for government rules in the eastern Mediterranean goes back centuries, to the rule of the Byzantines, Arabs, and Ottomans at various times. The rulers kept changing, and were generally bureaucratic, so people got used to doing whatever minimum was necessary to appease them, and generally ignore them whenever possible. Hence rampant avoidance of taxation, buildings often built in blatant violation of zoning or building codes, large informal economies, preference for dealing with officials you personally know / are related to, etc. (IIRC, the author grouped Greece, Turkey, Lebanon, Israel, and Egypt in that analysis.)
  - ovi256 16y ago
    You can safely add the Balkans and Romania to that group. Although many things work well without a bribe in Romania, most important things, I'm told, do not. The first thing my parents do when they have to deal with the government is ask themselves who do we know that works in that department ? As teachers, that works great for them. TBH, they do that when dealing with private businesses too, maybe even more so, but then I realize that's just how business works.
    - radu_floricica 16y ago
      As a Romanian, this article mostly made me feel good there are worse places. Not a noble feeling, but I'll take what I can. This being said, this instinct about looking for acquaintances first is starting to be not so useful, and used mostly by the older generation. I've seen instances where inside intervention was less efficient - but I've also seen official free consultants (good ones) with too much free time because most people went over their. But still, it is unfortunately far from being a useless strategy in way too many cases. Compared to how the article paints Greece though, our problems are different. Tax evasion is real here, but not critical. What _is_ extremely painful at the moment is the widespread politicization of public institutions. Everything starting from middle school headmasters has to belong to a party or another (and of course usually it's the ruling one).
narkee 16y ago
Well written, although it reads more like an opinion piece than an objective report. If Greece were a business, it would become bankrupt and be dissolved. I guess that realistically can't happen for an entire country - but they really need a solid reboot.
- jsnell 16y ago
  It was written by Michael Lewis, so I suspect the primary goal was for it to be an entertaining story. Which it was, I hope he's working on a book on the subject.
  - sspencer 16y ago
    I agree! He's one of my favorite "light" writers on financial matters. His article about Iceland (http://www.vanityfair.com/politics/features/2009/04/iceland200904 http://www.vanityfair.com/politics/features/2009/04/iceland2...) is a classic.
- oiuygtfrtghyju 16y ago
  Bankruptcy can happen for a country. Happy exporting something to Somalia and getting a Somali currency bank check as payment - No? It's trickier to go bankrupt if your country use somebody else's money. Would you sell to Greece and accept euros you can spend in Germany - Yes ?
  - mfukar 16y ago
    True; expulsion (or leave) from a monetary union will also effect the euro considerably, and those issues (mistrust, bond revaluation, etc.) can quickly evolve in an avalanche effect. No sane person in the EU wants that.
    - oiuygtfrtghyju 16y ago
      Also physically a bit tricky. You would have to announce it in advance, to allow time for the new currency to be produced - in which time everybody would hoard euros. Then everyone waits for the new currency to fall like a stone, so nobody uses it, so no tax revenue.
davidw 16y ago
Sounds like Italy ^ 2.
georgecmu 16y ago
“The second day on the job I had to call a meeting to look at the budget,” he says. “I gathered everyone from the general accounting office, and we started this, like, discovery process.” Each day they discovered some incredible omission. Last week there was a post about a woman that was $185K in debt and didn't know it. There were a lot of comments asking how that could happen. Here's an example of a whole country that didn't know how much it owed.
georgecmu 16y ago
Actually, wasn't this article in the top just a few days ago? [UPD:] Here's the link to the prior submission: http://news.ycombinator.com/item?id=1670824 http://news.ycombinator.com/item?id=1670824
whakojacko 16y ago
Well that was incredibly depressing...the amount of social change (nevermind laws and enforcement and such) needed to fix Greece sounds nearly impossible.
code_duck 16y ago
Nice that we can still rely on Vanity Fair, the New Yorker and (sometimes) the Atlantic for journalism this thorough. Greece seems insane, of course - but there's always Italy.
- mikebike 16y ago
  Why the qualifier for the Atlantic? I find it tends to have more journalism than VF and New Yorker, which have more cultural content. In particular, the New Yorker will typically have one good piece of journalism per issue, where the Atlantic will have multiple.
  - code_duck 16y ago
    Good point, I'm not sure what I was thinking. The Atlantic is generally excellent, too, I guess I'm just not as familiar with them.
- jseliger 16y ago
  The question is: do you convert that sentiment to subscribing? I ask because the only way good journalism venues can survive in the short to medium term is through print subscriptions, which subsidize their websites. (For those of you about to level the charge of hypocrisy: I get the New Yorker and the Atlantic. Reading the latter starting when I was a college freshmen has probably taught nearly as much as all my non-technical classes combined.)
  - natrius 16y ago
    It's a nice sentiment, but expecting people to subscribe to your print magazine because they like reading your articles online is a recipe for a broken business model. People like good journalism and they're willing to support it, but such support needs to be requested in a logical manner. When non-profits request donations, that makes sense. When for-profit print publications ask for subscriptions, people are disinclined to follow through because they don't actually want what they're presumably paying for.
StavrosK 16y ago
Something the article doesn't mention (or that I didn't see when I skimmed it): The value of the entire Greek church is in the billions of euros, and nothing is taxed. The government asked them to be taxed a while ago, and the church said that, if they were taxed, they would have to stop charity work because they didn't have enough money. Meanwhile, the high priests wear 30k euro hats and ride around in limousines. On the other hand, if they did get taxed, a good chunk of it would end up in the pockets of politicians and big companies, as usual. The whole situation isn't very encouraging for citizens who pay taxes... EDIT: This article [1] mentions that the church put the value of its property at 700m euros. External parties place it at 2-15b euros, while at some point, years ago, 5 monasteries said that they evaluated the value of their properties at around 20b of today's euros (this is just for 5 monasteries). You can imagine how taxing the church would pay off a good chunk of the debt, but, in Greece, you don't get taxed when you have this much money. [1]: http://dialogoi.enet.gr/post/νάνος-ή-γίγαντας-η-εκκλησιαστική-περιουσία-μέρος-1ο http://dialogoi.enet.gr/post/νάνος-ή-γίγαντας-η-εκκλησιαστικ...
- pbhjpbhj 16y ago
  >5 monasteries said that they evaluated the value of their properties at around 20b of today's euros (this is just for 5 monasteries). You can imagine how taxing the church would pay off a good chunk of the debt So are you proposing that they instigate a one-off property tax on everyone in Greece or just on the monasteries. The reason that 5 monasteries have so much valuable land is not necessarily that they are rich (the meals described in the article and lifestyle aren't exactly lavish either) but because they own large areas of land which when they adopted them 100s of years ago were probably unwanted, but now (speculating) are probably places where holiday resorts would be built. Demanding a piece of a valuation of the properties would I imagine mean many such properties would be sold off and a great swathe of Greek heritage from the last millenium or so would then be following all the unpaid taxes and disappearing. Perhaps you could explain further how you propose to get cash out of monastic property?
  - _delirium 16y ago
    The "value" of the monasteries also seems like it requires assumptions about what would be permitted. I imagine Mount Athos, for example, could be quite valuable as a tourist and resort destination--- could make some nice boutique hotels out of those historic monasteries. But since secular development has been banned on the peninsula for centuries, I can't imagine that actually happening. If we assume that Mouth Athos will stay off-limits to secular development, and assume that the removal/sale of historic items from the monasteries wouldn't be permitted, the value of their land and holdings (e.g. manuscripts) is much lower, because it isn't commercially exploitable. Now shell companies owned by the church engaged in normal for-profit business, those seem pretty reasonable to tax.
artpop 16y ago
I read that as "Geeks are sure of one thing: they can’t trust their fellow Geeks" and was subsequently rather surprised when the photo of that chap came up.
- jhen095 16y ago
  haha, me too. Every time. Probably also very true, someone should blog about this.
sx 16y ago
The article points out many of the problems of the greek economy, like: * The inflated public sector * The power of the unions over the government * The corruption in certain areas of the public sector (e.g. hospitals) * The loose observance of laws But it mischaracterizes several important points, as it is commons with articles that describe such complicated issues after a minimal exposure of the journalist to the situation: * Tax evasion does not hurt the real economy. Especially not in a country like Greece where the public sector is so inefficient. It might be unfair for some but it doesn't really hurt the economy. In some cases it enables smart and motivated entrepreneurs to start their businesses. * Most public sector workers are not corrupted but they are part of the problem simply because of the fact that they work in the public sector. Think of DMV x1000. * The majority of Greeks are against the unions and would like to see the public sector shrink.
- jakarta 16y ago
  Tax evasion hurts when a government owes tons of money that it cannot pay back with the current tax revenue coming in.
  - sx 16y ago
    But this is not the cause of the economic problems. The more appropriate solution would be to shut down the money-loosing public businesses (like the train org) and lay off as many people as needed from the public sector. This way, they will reduce government spending and will also allow people to do something more productive. More taxation will just slow down the economy even further.
    - deleted 16y ago
      [deleted]
    - jakarta 16y ago
      Greece has a debt crisis. The state borrowed some €216 billion and now cannot pay it. This isn't just some slow down caused by the business cycle that can be fixed by reducing taxes. Tax evasion costs the Greek government an estimated $20B a year. I would say that improving tax collection would significantly help Greece make payments on their debt. You have a big problem when there are millionaire doctors not paying a cent in taxes to the state. Sure, they have money wasting state enterprises, they could try to privatize some of them - but it is something that should not be done in a hasty manner. Rushes to privatize have led to massive failures (see Russia, parts of Latin America). So in order to get out of this mess they should 1. Restructure the debt to get a longer payment schedule 2. Improve their ability to collect taxes so that they can make some of those payments. 3. Work to privatize certain state owned businesses / infrastructure. ... or drop out of the EU, devalue currency, grow GDP
mmphosis 16y ago
I don't think that the "money as debt" problem is specific to Greece. You know that your country, province/state, city/county is probably in similar circumstances. And the problem is not about local people not being able to trust their fellow people. The problem is usury: banks, and the financial systems that loan money where there is no money to pay back the compounded interest. Here is the top comment on this http://www.cbc.ca/money/story/2010/09/08/bank-rate-decision-sept.html http://www.cbc.ca/money/story/2010/09/08/bank-rate-decision-... cbc story about the Bank Of Canada. Watch the movie: http://ohcanadamovie.com/ http://ohcanadamovie.com/ "If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered" Thomas Jefferson 1816 Did you know that PRIVATE Banks print 85% of our money supply in Canada and 100% of the money supply in the US ( the Federal Reserve ) 1 they print money out of thin air 2 lend it to our governments with interest 3 fiat currency 4 fractional reserves ( for every $ 1 printed they can loan another $ 9 out of thin air 5 they control the money supply and devalue YOUR money in order to profit Our monetary system is the biggest SCAM going Banks love a DEBT ECONOMY & they love Government Deficits – the more debt the dump into the system the higher the profits they make The Bank Of Canada (Central Bank Of Canada) used to be under the authority of the Federal Finance Minister. Ostensibly, to this day, it still is. But there is a catch that most people don't know about. From 1934 until 1974 it created currency and the issuance of credit for the PEOPLE OF CANADA The interest on these loans was put back into Canada and was used to build the Trans Canada Hwy and various infrastructure In 1974, however, when Canada joined the G7, which became the G8, which is now the G20, it gave up it's monetary control and credit issuance to private banking cartels that run most of the western industrial nations (Germany, England, France, Switzerland, Italy etc). The Canadian National Debt has since gone from 18 billion in 1974, to now 500 billion in 2009 "Once a nation parts with the control of Its currency and credit, it matters not who makes that nations laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile." William Lyon Mackenzie King 10th Prime Minister of Canada. "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance." James Madison "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning". Henry Ford
brc 16y ago
I thought that was an excellent, well written and entertaining article. Well worth the time if you are interested. To me the only solution is to remove themselves from the EU and go back to their own currency. And for some type of structured devaluation of their existing debts to gradually -rather than overnight- allow the other european banks to write off the losses. Though I'm not sure how you could get it to work out in practice. But the inflation rate and deficits were all a sham, I'm sure they can come up with some sort of sham valuation on untraded paper.
- forgottenpaswrd 16y ago
  They thought about this. What happens is that there is no way the devaluation could become "gradual". Imagine being Greek and having all your live savings in the bank, in euros, and tomorrow they become drachmas and in the process losing 25% purchasing power. What do you do? You sell all your drachmas and buy euros or dollars because you know drachmas are going to be even less tomorrow. It doesn't matter you make it illegal, people is going to do it anyway. This is what happened in Argentina, nobody wanted pesos, they wanted USD. People stopped using banks(this way the government has less power over your money). Also, people feel enormously betrayed when they realize their hard earned savings become nothing and politician heads roll down, so politicians try to delay it as much as possible. IMO it will happen sooner or later anyway, unfortunately because they were in fact betrayed.
  - brc 16y ago
    I was thinking more of the debt rather than the currency. My point of view wasn't so much the Greeks but the european banks with exposure to Greek government debt. I was thinking along the lines of an ECB fund that assumed responsibility for the debt, froze trading in it and gradually reduced the value somehow. But as you say, once the Euro is dumped whatever replaces it is going to be very unstable. All in all, it's a good warning against the evils of excessive government spending and endless deficits.
  - gaius 16y ago
    A currency is "legal tender" because a government will accept taxes in it, so in practice everyone has to have it, and use it for their own commercial activity. But in an economy where no-one pays taxes anyway...
DuncanIdaho 16y ago
"There’s no question that the government is resolved to at least try to re-create Greek civic life. The only question is: Can such a thing, once lost, ever be re-created?" I reccomend reading Machiavelli's Discourses to anyone interested in the particular subject. He has put much study into this question. To provide short answer - Niccolo believes that once the "civic virtue" of the state (and thus its citizens) gets corrupted it certainly is possible to restore it - but that he sadly cannot think of a single person that would be capable of pulling it of (it is such a monumental undertaking, requiring an honest person to commit some amoral actions - without succumbing to corruption of power). Thus a more probable course of action according to Machiavelli is - that such a state (or nation) is condemned to "eternal" turomoil and/or domination from an other (more virtous) power.
nodata 16y ago
This is truly an excellent article. I've never read an article online of this length before where I haven't taken a break or switched tabs. Having said that, the Vanity Fair website has a lot of fluff ("Which President Decorated the Oval Office Best?" anybody?). If they concentrated on quality articles like this one I'd subscribe in an instant.
patinador 16y ago
When things are going bad is not easy to change. It is easy to spend money, to borrow and to forget to pay taxes. But the other way round is another story, one to be written and not a gay one.

157 points by surlyadopter 16y ago

Fantastic article. I can only wonder how the Greek government will move forward.

mindslight 16y ago

This entire article presumes that the Greek people are responsible for the debts of the Greek government.

varjag 16y ago
Well they elect the government, so yes they are.
- mindslight 16y ago
  Having the ability to cast a vote makes one responsible for all actions of whomever gets elected, plus the entire standing government?
  - varjag 16y ago
    Voting in representative democracy is statistical quality, so no, not one in particular but a nation as a whole. Like in the USA you might not be personally responsible for Iraq war, but as an American, you are. Of course such property makes it attractive to neglect personal political responsibility. But in some situations, like with Greeks now, it can come back and bite you in the ass. (Also, read the article - it's not quite about benign populi paying for mistakes of the Government)
    - mindslight 16y ago
      To be partially responsible for something, there must be something one could have done that may have prevented it. Please tell me as an American, what I could have done that could have possibly prevented the Iraq war. I'm not asking for monumental results, but at least what would have withdrawn my alleged contribution to the war? I did read the article, and all of its prescriptions presume that the Greek people are indebted to their government. Is it not possible that the informal economy grows, the government goes bankrupt, but the society (held together by local structures) continues on?
      - varjag 16y ago
        You could not do much I'm afraid, it's sad but it still holds you responsible as part of the group. May sound too harsh, but collective responsibility is acknowledged explicitly e.g. in post-war German ideology. Being taught that in schools might alone make people more considerate of their choices in general. As for the article, it suggests that Greeks despise and distrust each other in first place. Not sure it's a good starting point for anarchic type of society. Also, notice how the most vocal protesters there were the government workers (who earn triple of the private sector on average).
jancona 16y ago
In practice, they are, unless they can pick up and leave, taking their assets with them. (Any Greeks thinking about doing this, I suggest you do it soon.) It may not be fair, but the last paragraph of the article lays out the choices pretty well. They're all bad, and the people of Greece will feel the pain either way.

surlyadopter 16y ago

“The Greek people never learned to pay their taxes. And they never did because no one is punished. No one has ever been punished. It’s a cavalier offense—like a gentleman not opening a door for a lady.” The article makes it clear that for Greece to improve this type of behavior must change. But is it even possible for Greece to do this in the span of say, less than one generation?

_delirium 16y ago
I can't seem to find it, but I recall reading a piece at one point that suggested the general disregard for government rules in the eastern Mediterranean goes back centuries, to the rule of the Byzantines, Arabs, and Ottomans at various times. The rulers kept changing, and were generally bureaucratic, so people got used to doing whatever minimum was necessary to appease them, and generally ignore them whenever possible. Hence rampant avoidance of taxation, buildings often built in blatant violation of zoning or building codes, large informal economies, preference for dealing with officials you personally know / are related to, etc. (IIRC, the author grouped Greece, Turkey, Lebanon, Israel, and Egypt in that analysis.)
- ovi256 16y ago
  You can safely add the Balkans and Romania to that group. Although many things work well without a bribe in Romania, most important things, I'm told, do not. The first thing my parents do when they have to deal with the government is ask themselves who do we know that works in that department ? As teachers, that works great for them. TBH, they do that when dealing with private businesses too, maybe even more so, but then I realize that's just how business works.
  - radu_floricica 16y ago
    As a Romanian, this article mostly made me feel good there are worse places. Not a noble feeling, but I'll take what I can. This being said, this instinct about looking for acquaintances first is starting to be not so useful, and used mostly by the older generation. I've seen instances where inside intervention was less efficient - but I've also seen official free consultants (good ones) with too much free time because most people went over their. But still, it is unfortunately far from being a useless strategy in way too many cases. Compared to how the article paints Greece though, our problems are different. Tax evasion is real here, but not critical. What _is_ extremely painful at the moment is the widespread politicization of public institutions. Everything starting from middle school headmasters has to belong to a party or another (and of course usually it's the ruling one).

narkee 16y ago

Well written, although it reads more like an opinion piece than an objective report. If Greece were a business, it would become bankrupt and be dissolved. I guess that realistically can't happen for an entire country - but they really need a solid reboot.

jsnell 16y ago
It was written by Michael Lewis, so I suspect the primary goal was for it to be an entertaining story. Which it was, I hope he's working on a book on the subject.
- sspencer 16y ago
  I agree! He's one of my favorite "light" writers on financial matters. His article about Iceland (http://www.vanityfair.com/politics/features/2009/04/iceland200904 http://www.vanityfair.com/politics/features/2009/04/iceland2...) is a classic.
oiuygtfrtghyju 16y ago
Bankruptcy can happen for a country. Happy exporting something to Somalia and getting a Somali currency bank check as payment - No? It's trickier to go bankrupt if your country use somebody else's money. Would you sell to Greece and accept euros you can spend in Germany - Yes ?
- mfukar 16y ago
  True; expulsion (or leave) from a monetary union will also effect the euro considerably, and those issues (mistrust, bond revaluation, etc.) can quickly evolve in an avalanche effect. No sane person in the EU wants that.
  - oiuygtfrtghyju 16y ago
    Also physically a bit tricky. You would have to announce it in advance, to allow time for the new currency to be produced - in which time everybody would hoard euros. Then everyone waits for the new currency to fall like a stone, so nobody uses it, so no tax revenue.

davidw 16y ago

Sounds like Italy ^ 2.

georgecmu 16y ago

“The second day on the job I had to call a meeting to look at the budget,” he says. “I gathered everyone from the general accounting office, and we started this, like, discovery process.” Each day they discovered some incredible omission. Last week there was a post about a woman that was $185K in debt and didn't know it. There were a lot of comments asking how that could happen. Here's an example of a whole country that didn't know how much it owed.

georgecmu 16y ago

Actually, wasn't this article in the top just a few days ago? [UPD:] Here's the link to the prior submission: http://news.ycombinator.com/item?id=1670824 http://news.ycombinator.com/item?id=1670824

whakojacko 16y ago

Well that was incredibly depressing...the amount of social change (nevermind laws and enforcement and such) needed to fix Greece sounds nearly impossible.

code_duck 16y ago

Nice that we can still rely on Vanity Fair, the New Yorker and (sometimes) the Atlantic for journalism this thorough. Greece seems insane, of course - but there's always Italy.

mikebike 16y ago
Why the qualifier for the Atlantic? I find it tends to have more journalism than VF and New Yorker, which have more cultural content. In particular, the New Yorker will typically have one good piece of journalism per issue, where the Atlantic will have multiple.
- code_duck 16y ago
  Good point, I'm not sure what I was thinking. The Atlantic is generally excellent, too, I guess I'm just not as familiar with them.
jseliger 16y ago
The question is: do you convert that sentiment to subscribing? I ask because the only way good journalism venues can survive in the short to medium term is through print subscriptions, which subsidize their websites. (For those of you about to level the charge of hypocrisy: I get the New Yorker and the Atlantic. Reading the latter starting when I was a college freshmen has probably taught nearly as much as all my non-technical classes combined.)
- natrius 16y ago
  It's a nice sentiment, but expecting people to subscribe to your print magazine because they like reading your articles online is a recipe for a broken business model. People like good journalism and they're willing to support it, but such support needs to be requested in a logical manner. When non-profits request donations, that makes sense. When for-profit print publications ask for subscriptions, people are disinclined to follow through because they don't actually want what they're presumably paying for.

StavrosK 16y ago

Something the article doesn't mention (or that I didn't see when I skimmed it): The value of the entire Greek church is in the billions of euros, and nothing is taxed. The government asked them to be taxed a while ago, and the church said that, if they were taxed, they would have to stop charity work because they didn't have enough money. Meanwhile, the high priests wear 30k euro hats and ride around in limousines. On the other hand, if they did get taxed, a good chunk of it would end up in the pockets of politicians and big companies, as usual. The whole situation isn't very encouraging for citizens who pay taxes... EDIT: This article [1] mentions that the church put the value of its property at 700m euros. External parties place it at 2-15b euros, while at some point, years ago, 5 monasteries said that they evaluated the value of their properties at around 20b of today's euros (this is just for 5 monasteries). You can imagine how taxing the church would pay off a good chunk of the debt, but, in Greece, you don't get taxed when you have this much money. [1]: http://dialogoi.enet.gr/post/νάνος-ή-γίγαντας-η-εκκλησιαστική-περιουσία-μέρος-1ο http://dialogoi.enet.gr/post/νάνος-ή-γίγαντας-η-εκκλησιαστικ...

pbhjpbhj 16y ago
>5 monasteries said that they evaluated the value of their properties at around 20b of today's euros (this is just for 5 monasteries). You can imagine how taxing the church would pay off a good chunk of the debt So are you proposing that they instigate a one-off property tax on everyone in Greece or just on the monasteries. The reason that 5 monasteries have so much valuable land is not necessarily that they are rich (the meals described in the article and lifestyle aren't exactly lavish either) but because they own large areas of land which when they adopted them 100s of years ago were probably unwanted, but now (speculating) are probably places where holiday resorts would be built. Demanding a piece of a valuation of the properties would I imagine mean many such properties would be sold off and a great swathe of Greek heritage from the last millenium or so would then be following all the unpaid taxes and disappearing. Perhaps you could explain further how you propose to get cash out of monastic property?
- _delirium 16y ago
  The "value" of the monasteries also seems like it requires assumptions about what would be permitted. I imagine Mount Athos, for example, could be quite valuable as a tourist and resort destination--- could make some nice boutique hotels out of those historic monasteries. But since secular development has been banned on the peninsula for centuries, I can't imagine that actually happening. If we assume that Mouth Athos will stay off-limits to secular development, and assume that the removal/sale of historic items from the monasteries wouldn't be permitted, the value of their land and holdings (e.g. manuscripts) is much lower, because it isn't commercially exploitable. Now shell companies owned by the church engaged in normal for-profit business, those seem pretty reasonable to tax.

artpop 16y ago

I read that as "Geeks are sure of one thing: they can’t trust their fellow Geeks" and was subsequently rather surprised when the photo of that chap came up.

jhen095 16y ago
haha, me too. Every time. Probably also very true, someone should blog about this.

sx 16y ago

The article points out many of the problems of the greek economy, like: * The inflated public sector * The power of the unions over the government * The corruption in certain areas of the public sector (e.g. hospitals) * The loose observance of laws But it mischaracterizes several important points, as it is commons with articles that describe such complicated issues after a minimal exposure of the journalist to the situation: * Tax evasion does not hurt the real economy. Especially not in a country like Greece where the public sector is so inefficient. It might be unfair for some but it doesn't really hurt the economy. In some cases it enables smart and motivated entrepreneurs to start their businesses. * Most public sector workers are not corrupted but they are part of the problem simply because of the fact that they work in the public sector. Think of DMV x1000. * The majority of Greeks are against the unions and would like to see the public sector shrink.

jakarta 16y ago
Tax evasion hurts when a government owes tons of money that it cannot pay back with the current tax revenue coming in.
- sx 16y ago
  But this is not the cause of the economic problems. The more appropriate solution would be to shut down the money-loosing public businesses (like the train org) and lay off as many people as needed from the public sector. This way, they will reduce government spending and will also allow people to do something more productive. More taxation will just slow down the economy even further.
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  - jakarta 16y ago
    Greece has a debt crisis. The state borrowed some €216 billion and now cannot pay it. This isn't just some slow down caused by the business cycle that can be fixed by reducing taxes. Tax evasion costs the Greek government an estimated $20B a year. I would say that improving tax collection would significantly help Greece make payments on their debt. You have a big problem when there are millionaire doctors not paying a cent in taxes to the state. Sure, they have money wasting state enterprises, they could try to privatize some of them - but it is something that should not be done in a hasty manner. Rushes to privatize have led to massive failures (see Russia, parts of Latin America). So in order to get out of this mess they should 1. Restructure the debt to get a longer payment schedule 2. Improve their ability to collect taxes so that they can make some of those payments. 3. Work to privatize certain state owned businesses / infrastructure. ... or drop out of the EU, devalue currency, grow GDP

mmphosis 16y ago

I don't think that the "money as debt" problem is specific to Greece. You know that your country, province/state, city/county is probably in similar circumstances. And the problem is not about local people not being able to trust their fellow people. The problem is usury: banks, and the financial systems that loan money where there is no money to pay back the compounded interest. Here is the top comment on this http://www.cbc.ca/money/story/2010/09/08/bank-rate-decision-sept.html http://www.cbc.ca/money/story/2010/09/08/bank-rate-decision-... cbc story about the Bank Of Canada. Watch the movie: http://ohcanadamovie.com/ http://ohcanadamovie.com/ "If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered" Thomas Jefferson 1816 Did you know that PRIVATE Banks print 85% of our money supply in Canada and 100% of the money supply in the US ( the Federal Reserve ) 1 they print money out of thin air 2 lend it to our governments with interest 3 fiat currency 4 fractional reserves ( for every $ 1 printed they can loan another $ 9 out of thin air 5 they control the money supply and devalue YOUR money in order to profit Our monetary system is the biggest SCAM going Banks love a DEBT ECONOMY & they love Government Deficits – the more debt the dump into the system the higher the profits they make The Bank Of Canada (Central Bank Of Canada) used to be under the authority of the Federal Finance Minister. Ostensibly, to this day, it still is. But there is a catch that most people don't know about. From 1934 until 1974 it created currency and the issuance of credit for the PEOPLE OF CANADA The interest on these loans was put back into Canada and was used to build the Trans Canada Hwy and various infrastructure In 1974, however, when Canada joined the G7, which became the G8, which is now the G20, it gave up it's monetary control and credit issuance to private banking cartels that run most of the western industrial nations (Germany, England, France, Switzerland, Italy etc). The Canadian National Debt has since gone from 18 billion in 1974, to now 500 billion in 2009 "Once a nation parts with the control of Its currency and credit, it matters not who makes that nations laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile." William Lyon Mackenzie King 10th Prime Minister of Canada. "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance." James Madison "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning". Henry Ford

brc 16y ago

I thought that was an excellent, well written and entertaining article. Well worth the time if you are interested. To me the only solution is to remove themselves from the EU and go back to their own currency. And for some type of structured devaluation of their existing debts to gradually -rather than overnight- allow the other european banks to write off the losses. Though I'm not sure how you could get it to work out in practice. But the inflation rate and deficits were all a sham, I'm sure they can come up with some sort of sham valuation on untraded paper.

forgottenpaswrd 16y ago
They thought about this. What happens is that there is no way the devaluation could become "gradual". Imagine being Greek and having all your live savings in the bank, in euros, and tomorrow they become drachmas and in the process losing 25% purchasing power. What do you do? You sell all your drachmas and buy euros or dollars because you know drachmas are going to be even less tomorrow. It doesn't matter you make it illegal, people is going to do it anyway. This is what happened in Argentina, nobody wanted pesos, they wanted USD. People stopped using banks(this way the government has less power over your money). Also, people feel enormously betrayed when they realize their hard earned savings become nothing and politician heads roll down, so politicians try to delay it as much as possible. IMO it will happen sooner or later anyway, unfortunately because they were in fact betrayed.
- brc 16y ago
  I was thinking more of the debt rather than the currency. My point of view wasn't so much the Greeks but the european banks with exposure to Greek government debt. I was thinking along the lines of an ECB fund that assumed responsibility for the debt, froze trading in it and gradually reduced the value somehow. But as you say, once the Euro is dumped whatever replaces it is going to be very unstable. All in all, it's a good warning against the evils of excessive government spending and endless deficits.
- gaius 16y ago
  A currency is "legal tender" because a government will accept taxes in it, so in practice everyone has to have it, and use it for their own commercial activity. But in an economy where no-one pays taxes anyway...

DuncanIdaho 16y ago

"There’s no question that the government is resolved to at least try to re-create Greek civic life. The only question is: Can such a thing, once lost, ever be re-created?" I reccomend reading Machiavelli's Discourses to anyone interested in the particular subject. He has put much study into this question. To provide short answer - Niccolo believes that once the "civic virtue" of the state (and thus its citizens) gets corrupted it certainly is possible to restore it - but that he sadly cannot think of a single person that would be capable of pulling it of (it is such a monumental undertaking, requiring an honest person to commit some amoral actions - without succumbing to corruption of power). Thus a more probable course of action according to Machiavelli is - that such a state (or nation) is condemned to "eternal" turomoil and/or domination from an other (more virtous) power.

nodata 16y ago

This is truly an excellent article. I've never read an article online of this length before where I haven't taken a break or switched tabs. Having said that, the Vanity Fair website has a lot of fluff ("Which President Decorated the Oval Office Best?" anybody?). If they concentrated on quality articles like this one I'd subscribe in an instant.

patinador 16y ago

When things are going bad is not easy to change. It is easy to spend money, to borrow and to forget to pay taxes. But the other way round is another story, one to be written and not a gay one.