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Concerning "Some of the issues are that the IMF wants Greece to implement the austerity stuff on a different time scale than SYRIZA plans to, and that the pop

by wolfgke 11y ago

Concerning "Some of the issues are that the IMF wants Greece to implement the austerity stuff on a different time scale than SYRIZA plans to, and that the population is very much against those systems (which I can understand). [...] The reason: Currently, greece has to pay back debts, but that means people have to pay a lot more taxes, and only see the infrastructure to become worse – leading to uproar.": If the Greek people lived beyond their means in the past, someday the moment will come where they have to tighten their belts. Bad luck, but they decided in the past to spend money that they don't have.

phn 11y ago
The point is, people lent them that money, without caring if they could or not pay... Those people are demanding their terms to be met, regardless of weather that is a realistic demand or not. I am not saying who is wrong or who is right, but I don't think the blame falls only in one side. I'd argue that you take a risk when you lend money, and shit happens if you lend to people who can't pay.
- zo1 11y ago
  The way I'm seeing this is that "yes, Greece can pay", they just voted not to. If one looks at it that way, the whole argument about "lenders chose to lend to them, taking risk that they might not be able to pay, therefore they are to blame as well", falls wayside. This is because the risk they assumed to be taking was one of Greece "not being able to pay", not Greece choosing to not honour the deal. Tl;dr: There is a difference between the risk of not being able to pay, and the risk of choosing to default/not pay at all.
  - phn 11y ago
    Sure, but the only way they can pay, is by borrowing more, it is just a vicious cycle that will eventually pop... The point is no one wants the bomb to blow up on their hands, and I get that, but meanwhile the situation in the country gets worse and worse... in the hopes that somehow the country generates more money. Here the "ideology" starts taking place in the discussion, there are proponents of austerity, saying the confidence generated by always paying out-weights the short term losses, and there are people that say it doesn't work, and that we should somehow try something different since this strategy has been tried and failed a couple of times already. Like, hey let the guys off the hook for part of their debt (lenders knew the risk...), and let the blow generate economic pressure for growth (e.g. Get out of the euro, and let the newly minted and devalued currency be extremely attractive to buy stuff out of Greece, making their economy move).
ubernostrum 11y ago
So, future generations should be condemned to misery and poverty because of the bad decisions of the past and a need to make amends for that? If that's really your theory, then Greece is not the first European country you should target.
- wolfgke 11y ago
  If the Greek really hate their debt (and the interest) so much, then why isn't there a strong movement in Greece to reduce or at least not increase debt by a strict budget policy? Switzerland added a balanced budget amendment to their constitution in 2001 > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Switzerland https://en.wikipedia.org/wiki/Balanced_budget_amendment#Swit... Many people consider this as the model for a similar amendment that was added to Germany's constitution in 2009 > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Germany https://en.wikipedia.org/wiki/Balanced_budget_amendment#Germ... (which the German government takes really seriously at the moment) and Austria's in 2011: > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Austria https://en.wikipedia.org/wiki/Balanced_budget_amendment#Aust...
kuschku 11y ago
Yes, but what I’m saying is: If you only increase taxes and shut down spending to a minimum, you’ll either get a revolution, or the next election will lead to a government that just stops the Austerity. You have to show the people at the same time that they gain something, too – for example, while you reduce corruption in tax spending, one of the first priorities should be improving performance of Police and similar public services. You can save a lot of money there while at the same time providing a better service. That leads to better public acceptance.

by wolfgke 11y ago

phn 11y ago

The point is, people lent them that money, without caring if they could or not pay... Those people are demanding their terms to be met, regardless of weather that is a realistic demand or not. I am not saying who is wrong or who is right, but I don't think the blame falls only in one side. I'd argue that you take a risk when you lend money, and shit happens if you lend to people who can't pay.

zo1 11y ago
The way I'm seeing this is that "yes, Greece can pay", they just voted not to. If one looks at it that way, the whole argument about "lenders chose to lend to them, taking risk that they might not be able to pay, therefore they are to blame as well", falls wayside. This is because the risk they assumed to be taking was one of Greece "not being able to pay", not Greece choosing to not honour the deal. Tl;dr: There is a difference between the risk of not being able to pay, and the risk of choosing to default/not pay at all.
- phn 11y ago
  Sure, but the only way they can pay, is by borrowing more, it is just a vicious cycle that will eventually pop... The point is no one wants the bomb to blow up on their hands, and I get that, but meanwhile the situation in the country gets worse and worse... in the hopes that somehow the country generates more money. Here the "ideology" starts taking place in the discussion, there are proponents of austerity, saying the confidence generated by always paying out-weights the short term losses, and there are people that say it doesn't work, and that we should somehow try something different since this strategy has been tried and failed a couple of times already. Like, hey let the guys off the hook for part of their debt (lenders knew the risk...), and let the blow generate economic pressure for growth (e.g. Get out of the euro, and let the newly minted and devalued currency be extremely attractive to buy stuff out of Greece, making their economy move).

ubernostrum 11y ago

So, future generations should be condemned to misery and poverty because of the bad decisions of the past and a need to make amends for that? If that's really your theory, then Greece is not the first European country you should target.

wolfgke 11y ago
If the Greek really hate their debt (and the interest) so much, then why isn't there a strong movement in Greece to reduce or at least not increase debt by a strict budget policy? Switzerland added a balanced budget amendment to their constitution in 2001 > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Switzerland https://en.wikipedia.org/wiki/Balanced_budget_amendment#Swit... Many people consider this as the model for a similar amendment that was added to Germany's constitution in 2009 > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Germany https://en.wikipedia.org/wiki/Balanced_budget_amendment#Germ... (which the German government takes really seriously at the moment) and Austria's in 2011: > https://en.wikipedia.org/wiki/Balanced_budget_amendment#Austria https://en.wikipedia.org/wiki/Balanced_budget_amendment#Aust...

kuschku 11y ago

Yes, but what I’m saying is: If you only increase taxes and shut down spending to a minimum, you’ll either get a revolution, or the next election will lead to a government that just stops the Austerity. You have to show the people at the same time that they gain something, too – for example, while you reduce corruption in tax spending, one of the first priorities should be improving performance of Police and similar public services. You can save a lot of money there while at the same time providing a better service. That leads to better public acceptance.