Should Greece be excluded from EU?

Discussion in 'Every Day Debating' started by anonymous, Mar 7, 2010.

  1. Turambar

    Turambar Harebrained Staff Member

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    Word is there's a deal in Athens between the Greek gouvernment and the EU and IMF;

    As promised; the public sector gets the greatest hits:
    - 3 year salary freeze
    - no job openings for the coming 3 years
    - severe limitation of fixed bonuses (no 13'th, 14'th month)
    - Shift of retirement age from 53 to 67 (!)

    - Increase of VAT by 1-3%

    If these figures hold true, I think there's still hope for Greece. Combined with stricter tax collection, Greece might just pull through.

    This by the way signifies a sustained saving on the national budget of about 10% of GDP.
     
  2. Justice

    Justice New Member

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    Still probably not going far enough.

    They have to look at their hazard pay laws, and try to reduce the now 1 in 3 people working for the government down to something far more acceptable. Here in California, it's closer to 1 in 100 and we're STILL swimming in pension obligation debt.

    One has to marvel at being able to retire in your early 50's. Possibly 40 years of collecting retirement and not having to work. The pool of retirees compared to workers paying the taxes to pay the retirees is mind boggling. When FDR introduced Social Security in America (an already bankrupted system) the minimum age was 65. People weren't expected to live more than a few years after that. Thanks to medical technology, 90 years in fairly common. SS was moved to 67 in the US, but it may have to be moved again.

    There should be no bail out. Greece should be thought of as the drowning swimmer, you can try to rescue them, but risk being pulled in yourself and drowned. I have no idea the financial laws in Greece, but in CA, politicians are seriously considering bankruptcy, because then the courts would allow us to overturn pension contracts given to state workers who collect 90% of their salary for the rest of their lives, and California has the highest paid teachers, firemen, police, and politicians in the nation.
     
  3. Foinikas

    Foinikas Playing backgammon!

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    A friend of mine wrote a nice status on his Facebook profile:

    George Papandreou says "We are on a difficult course,a new Odyssey for Hellenism.But we now know the way to Ithaca and we have charted(mapped)the waters."
    Somebody should inform George Papandreou that Ulysses(Odysseas)also knew the way to Ithaka,but it took him 10 years to get there....ALONE,the rest died on the way.
     
  4. Turambar

    Turambar Harebrained Staff Member

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    Hmmm. didn't he manage without a map? Dunno, but a map sort of makes a difference... Maybe he's trying to say that without this (austerity measures and loans), all but one would die? ;)

    First of all, there are reasons not to have Greece hit rock bottom. There are a good amount of posts about that.

    Secondly, I believe that what you are saying is incredibly wrong. After all, the gouvernment made a promise. It's a contract, if you like. I don't know how social security for pensioners works in the US, but here, people pay for theirs in their working years. The gouvernment then promises to pay for them until well... death, really. It is, of course, the gouvernment's task to calculate this trough. In a thorough way, of course. And if the pensioners are at the better end of the deal, that's their luck. It is simply low, extremely low to have none other then the gouvernment backing out on that - and cheering them on.

    Banks who have bought gouvernment bonds, however, are on a completely different position. They have to have taken into account the risk of debt restructioning or even defaulting when accepting an interest rate. Now, if the pensioners form a risk, I would assume that interest rates are high, which signify a high risk on invested money. If it isn't, they've been sleeping. Banks, in this case, share the responsibility by taking a financial risk.

    The pensioners don't....
     
  5. Foinikas

    Foinikas Playing backgammon!

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    The European Union is a failure.
     
  6. Justice

    Justice New Member

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    If the money isn't there, the money isn't there. Hard working civilians shouldn't have to cover the debt for the millions of government workers. It's not the pensioners fault for signing a luxurious contract, but at what cost? A total nationwide collapse? The idea of paying worker for 30, 40 years for NOT working, and continually adding more people to the government payroll (1 in 3 workers?? seriously??) cannot be sustained in any manner.

    Now, if the contracts are voided, and more reasonable contracts are drawn, then it is a good exercise on trusting / not trusting government officials, and reasoning through their promises. Promising a system which could never be financially sustained is a good reason NOT to elect a certain person, party, or government. Those who fail on their promises and show extremely poor judgment in the process? Well, lesson learned. Don't vote for them or vote them out of office. You can't continue to pay off people in an ever increasing pool of debt obligation to an unlimited end. Ideas, morals, ethics, and politics in general are theoretical. When an idea does not add up mathematically, well, then there's really nothing you can do.
     
  7. Turambar

    Turambar Harebrained Staff Member

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    Well, I fully agree on your mathematics, Just.

    But it simply doesn't work that way. People have made a career plan partially based on their pensions. And once they have reached this respectable age, as agreed with their employers, they will take what was promised. Although the employers, in this case, the gouvernment, could have been wrong about matters, it is unreasonable to expect the employees to take into account that the promise by their bosses was just a paper one, backed by air.

    And that Average Joe pays for these people... He pays them, so that, when time comes, he, too, can benefit from the same scheme. In essence, he is paying his own pension in advance. There's nothing wrong with that. If he refuses to pay, then that should affect his pension, not the ones of people who paid up in the past and are now reaping the harvest.

    Again, the risk the banks took in gouvernment bonds makes them far more liable to the damage dealt. They have taken a risk in gouvernment finances and, as such, have made an assessment of the situation - and found it to be a safe investment against the interest rate provided. This is not something that can be asked from the average pensioner or employee. I haven't seen you reason against that, Justice....
     
  8. ~Elladan~

    ~Elladan~ A Elbereth Gilthoniel

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    Most state pensions, and pensions paid to state employees are paid from current tax revenues. Nothing is accumulated towards current payers, future pension pot as their contributions are just paying for those already retired.

    The rescue deal appears to include a freeze in public sector employee salaries & pensions for 3 years. The rate of increase of pensions already in progress is set by the current government. They could freeze (as intended) the pensions so in effect they fall in real terms. They could link the increase/(decrease) to the rate of inflation, average earnings or any other index. Linking to average earnings would probably decrease pensions in the short term.

    http://news.bbc.co.uk/1/hi/business/8656649.stm
     
  9. ~Elladan~

    ~Elladan~ A Elbereth Gilthoniel

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    Mega 3 Year loan for Greece agreed...


    EU eurozone agrees 110bn-euro bail-out for Greece

    http://news.bbc.co.uk/1/hi/business/8656649.stm

    It'll be interesting to see reaction from the Greek public and the markets. Will they switch fire to another PIGS target? (Or with a hung parliament looking likely, will it be the UK?)
     
  10. Turambar

    Turambar Harebrained Staff Member

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    It's interesting to see the reaction of Italy...

    Italy is the third contributor to the plan, with €14bln, withouth contribution to IMF.

    The current debt of Italy was €1760bln as of the start of this year (115% of GDP and relatively higher than Greece's), and a deficit of 80bln, or 5,3% of GDP. Of course, this outlook number will be spread over 3 years, it will further compress the financial strech of the national budget there. I am very curious how the market is going to react, in terms of interest. I expect to see it go above 5%, which means Italy will make a loss on the Greek loans, risk or not. Now, this loss will be covered by the (contributors of the) ECB - but even so, regardless, Italy has to pay the same way of their own bonds.

    We're not out from under this yet...
     
  11. Foinikas

    Foinikas Playing backgammon!

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    The people are very angry here.All people.You can see it,you can feel it and you can understand that it's worse than before.

    The 11 billion Euro loan that we got will go to the pockets of the rich again.

    When you see members of the armed forces going on strike as well you understand that all the people are disappointed with the politicians.

    If something doesn't happen to change everything,their might be trouble in Greece because the people are so angry with the politicians right now especially the ones from PASOK and New Democracy they can beat them up at the street if they see them.
     
  12. ~Elladan~

    ~Elladan~ A Elbereth Gilthoniel

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    @Foinikas ~ I can understand ordinary peoples' anger but the Greek people are the architects of this disaster. If there wasn't corruption, tax evasion and an expectation of getting paid for doing nothing, the problems wouldn't be as big or the solution as painful.

    Reading todays news of impending general strikes, I'm sure that the markets will take further fright, Greek bonds will become even less acceptable, the cost of servicing them even higher. If the Greeks are unable/unwilling to drive the austerity measures through, the Greek economy will fall off a cliff, dragging neighbours and currency with it.

    http://news.bbc.co.uk/1/hi/world/europe/8661385.stm

    The Euro continues to slide

    http://news.bbc.co.uk/1/hi/business/10097819.stm

    Speculators sense huge profits, betting on a negative result, they'll keep picking away.
     
  13. Turambar

    Turambar Harebrained Staff Member

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    Well, in a sense, there has been a general tendancy towards olichargy and low-level corruption in Greece for the past decades. So the fact that people are upset is actually quite understandable, since now they are paying the bill.

    Still, tax evasion is a national pass-time. Everyone does it. It seems they haven't understood that every euro not paid in taxes is another euro of debt for the gouvernment. Yes, Athens hasn't been after its tax money as much as it could. But none of these strikers are not to blame for the current crisis, or so I feel. Beyond that - striking costs money. And shiploads of it. And we're talking about money that isn't there... If Greece wants any kind of hope, they must swallow their pride and work hard - frantically - to get Greece out of this mess asap. As opposed to going on strike...

    Ow, and the €110bln (I think you missed a 0 there, Foin) can't go directly into anyone's pocket. These are bonds due in the forthcoming few years and they will be refinanced by the IMF and ECB. Good chance Athens doesn't even see the money. And if anyone in Athens screws up, then they will be dropped like a stone.
     
  14. Foinikas

    Foinikas Playing backgammon!

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    Not the people,the governments(the politicial elite)and the golden boys.
    The people are to be blamed for one thing(a majority):for voting the same two parties again and again for 30 years.
     
  15. ~Elladan~

    ~Elladan~ A Elbereth Gilthoniel

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    From what I've read (obviously I don't live there) ordinary government workers do as little as possible and still line their own pockets with 2months bonuses. Tax evasion is a national pastime. If the government sets the example, the people are still responsible as they are your elected representatives.

    Looks like things are getting nasty..

    http://news.bbc.co.uk/1/hi/world/europe/8661385.stm

    I can't see the Greek government being able to meet the loan conditions so this pack of cards looks likely to collapse.
     
  16. Foinikas

    Foinikas Playing backgammon!

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    Breaking News:

    Riots in Athens.Three people dead by molotov bombs,some people injured and chaos is still going on as the anarchists and leftists tried to take over the parliament.
     
  17. Justice

    Justice New Member

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    Honestly, once the molotov cocktails started getting thrown, police should have started shooting people.

    I'm serious.

    There's protest, where large groups of demonstrators gather, voice their opinions, organize, and then make their message heard. If people are being oppressed, and if they belong to a representational government, then there's always a way for a movement to take root and for people to unite for a common cause.

    Then there's the people who set banks on fire and murder innocent workers. Once a protest turns into a riot, a deadly riot, the police should have started shooting at anyone who was holding an incendiary device. I don't care if I sound like a fascist, I have no sympathy for people who kill or destroy simply for money, and that's all this riot was about. Money. I care not a wit if these people get killed. I'd rather see a hundred rioting anarchists or government workers mowed down by gunfire than even a single innocent person just trying to move their nation forward burned to death.

    Anarchists have no idea what they want. Their idea of utopia is no government where they can do what they want and live as they please, but anarchy would bring in the kind of totalitarian rule they despise. People would simply form bands, gangs, or clans as we ALWAYS have through history. There's strength in numbers, and before long you would have a government again.

    This really makes me sick to my stomach. We're looking at a European, and therefore a worldwide global economic collapse. Greece is not alone, virtually all the Mediterranean countries have severe debt problems, especially Spain, France, and Italy.
     
  18. ~Elladan~

    ~Elladan~ A Elbereth Gilthoniel

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    I'm inclined to agree..

    As expected the UK has a hung parliament. It's bond rates stayed largely unchanged despite the electoral uncertainty but then we have own currency, that can act as 'shock absorber' to the economy in the short term ~ dropped like a stone then started to recover yesterday...
     
  19. Foinikas

    Foinikas Playing backgammon!

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    I agree that anarchists don't know what they want.They are like "anti-anti".You know what
    I mean.They are anti-everything.And in the end what are they?Either punk,junkie youngsters or organized criminals who rob banks to fund their "anti-authority,anti-nationalist" ....err cause?Or just children of wealthy families trying to play rebellious.

    Yes you're right.The police should fire plastic bullets.The police should kick more asses.The police should arrest more people.But all they do is fire tear gas and more tear gas.Always.That's all they do.And they stay in defensive stance.Why does this only happen in Greece?Two reasons:

    1.The media are ALWAYS there right near some riot police or other forces to take screenshots of every single moment where a cop beats up someone or makes an arrest.Afterwards everything is condemned and criticized by mass media,especially all the mainstream powerful channels in Greece,from news reporters and news casters,to the "intellectual comedians" etc.
    2.The two main leftist political parties,the Communist Party and the Coalition of the Radical Left always protest about such actions of "violence and oppression of the State against the people" in the parliament not to mention it's THEIR followers who do such things.


    Conclusion: During the 1967-1973 Greek military junta rule,which is now considered utterly evil and fascist by a majority of the(uneducated or brain-washed)people,had ruled the country amazingly well by making the drachma a strong,powerful and stable currency at the time,not tolerating such acts of violence,leading to an orgasm and blossom in public constructions,ridiculously less bureaucracy,no corruption and it was a time when crime was scarce.The only ones who were and are fiercely against that time period are leftists,who didn't have such a good time back then.

    Today's politicians apart from being corrupted,they don't have the bullocks to show the greek people that they can CONTROL such riots.They only talk and ....f*ck man,you just hear the ministers say "We will not tolerate such actions" and it's like telling you "i love you" while i'm kicking you in the nuts,because they DO tolerate such actions and riots no matter what they say.They don't have the bullocks to stand against the media,to stand against the LEFTIST opinion and parties which are putting more oil to the flame.

    But again it's not just the anarcholeftists' fault it's also the gazillion of Euros and Drachmas "eaten" by the two political parties and their high-position friends or their families in the last 30 years of this country.

    But trying to take over the parliament?What the heck?Having the Communists and Radical Leftists calling for "popular revolution all over Europe"?

    Man the entire situation is fubar.
     
  20. Turambar

    Turambar Harebrained Staff Member

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    Well, so were the Greek protesters. But here, I will call into memory the 2008 shooting and subsequent police riots. Things would have gotten out of hands like way beyond one or two casualties. It would have, effectively, been the self-destruct button for Greece, the Euro and, possibly, much more.

    Anarchy a symptom of other things happening in society. I think it's too easy to blame anarchy for anything without blaming the people at the root cause. Now, it seems Greece has been a corrupt oligocracy for the last few years, and anarchy is a logical reaction.

    It's Newton's Third all over again :)

    There go the 'mericans again with their France.

    France:
    GDP: €1919316mln
    Deficit (2009): €144 849mln (7,5%)
    Debt (as of 2009): 1 489 025 (77,6%)

    In 2008, the debt was 3,3% of GDP - the 7,5% probably has to do with the economic crisis. France is manageble. French bonds are still rated AAA/stable by Moody's.


    But thanks for noticing. A few countries ARE playing russian roulette with the world. It's nothing new, when you think about it - it's what the US banks did with the mortgage market and subsequent complex financial products.
     
    Last edited: May 8, 2010