Greece’s ‘Austerity’ Plan Is Anything But

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Heretofore, debt-defaulting Greece has operated on Raiders of the Lost Ark-logic: “You throw me the idol; I’ll throw you the whip.” Its European Union and International Monetary Fund sugar daddies have tired of sending cash without budget reforms in return. On Thursday, they rejected Greece’s newest amorphous pledge of budget cuts later for billions now. Burned before by big promises with no fulfillment, the Eurogroup sent a clear message to the Greeks through its chair Jean-Claude Juncker: “no disbursement before implementation.”

But with Greece already forcing creditors to take a haircut, and refusing to make good on its pledged reforms, why would European nations agree to throw more good money after bad?

A coalition of Greek political leaders came to an agreement on Thursday to narrow the chasm between revenues and receipts in hopes of paving the way for $172 billion in new loans from the European Union. But EU finance ministers balked at the proposal that contained very little in specified cuts for non-defense-related government expenditures. The European finance ministers demanded from the troubled nation $325 billion in new cuts and parliament’s preapproval of the plan before it will agree to a further bailout. Greece, which is already de facto in default since other nations are paying its creditors, stands to legally default on March 20 if it doesn’t receive a cash infusion.

The refusal to implement promised budgetary and economic structural reforms is a tacit admission that Greek politicians believe the debt crisis just isn’t their fault. This is a popular sentiment within Greece, muted only when going abroad with hat in hand. Foreign bankers, EU bureaucrats, and American capitalists are favorite scapegoats according to internal Greek rhetoric. If outsiders are to blame for the crisis, why should Greeks reform their economic system? It’s everyone else who has the problem, after all, not Greece.

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  • Athenian

    I live in Athens.

    There's a lot of talk in the media about anti-troika anger in Greece. However, many people here were actually hopeful about the changes troika was going to enforce. The idea was that the EU would swoop in, dictate what needs to be done and our politicians would have to follow their orders. There was a lot of snickering about how the "EU was going to mess 'em up" only "mess up" wasn't the term used.

    That was naive.

    We haven't seen any of the promised – and hoped for – structural reforms. Believe me when I say that I know quite a few Greeks who would NOT be upset at Germans taking full control of the country. Others want the junta back. That's the state of things here.

    • Fred Dawes

      Can we say world bankers are buying up that country and will be working on the USA Real soon.

      • Athenian

        There are those who see this all this as some sort of plot to steal from Greece and those who privately ask, "Where is Papadopoulos when you need him!" The latter group is quite large.

  • diann

    It would be beneficial to North Americans to analyze what is happening in Europe, and take action to ensure we do not follow. Retirement at 53 is ridiculous – 25% of the employed working for the government – foolish. How can they keep a straight face while demanding support from the other EU countries? The idea of the EU has never made any sense to me, as that absolves individual countries from taking responsibility for their actions. This case is indication of that. I wonder how long the EU will last….

    • Fred Dawes

      We can do a Retirement at 62, in the USA but the system is setup to keep most of the money,
      The fact is the Foreign bankers have moved on most counties and have attacked retirement moneys in all areas from governmenr to IRA And have Raided most retirement PLANS of most people worldwide and the end game is mass world enslavement with the help of our governments worldwide that is what foreign bankers do.

      • Atikva

        That's right, let's get rid of "the bankers" and go back to barter.

        And let’s get rid of the Jews too (some of them are bankers, you know!), of the rich (i.e. anyone who doesn't rely on the nanny state to put food on the table) and of anyone who is energetic and not afraid of competition. How happy we will be then!

        What a moron!

  • StephenD

    It's like looking into a fun house mirror. As goes Greece, so goes the USA…unless real changes are made. We cannot continue to spend more than we take in and we cannot continue to take from our citizens in fees and taxes and hope for prosperity. What we must do is behave like any individual household would. Adjust your living standards to operate within the budget you have. Instead, it seems we form a government and implement programs and THEN determine how much we need to make it work. We should start at the other end; how much do we have to work with and form a government and programs that can function within it.

  • AntiSharia

    Greece should never have been admitted to the EU. And it should go back to the Drachma as soon as possible. This is what happens when a society is based on the idea of entitlement, sooner or later the government runs out of other peoples money. With the situation spiraling out of control so badly it is possible that the military might step in and take over. That wouldn't be the ideal solution, but it might happen anyway.

  • tanstaafl

    At least we cannot say that we were not warned.

  • Fred Dawes

    WATCH OUT we will see some really evil times, don't be surprised by anything you see or hear.

  • used to ba a liberal

    call me nuts if you like, but when I cut through all the he said she said type of stuff, all the extra information that we are given, a great amount of verbal hog wash. I can only see one thing at stake here, and that is European style socialism, hidden under the false impression of economic collapse, when really, it is socialism that is falling apart, and bussiness/ working people can't support the pigs at the trough. Socialism fails when it runs out of other peoples money, hence massive bailouts to prop it up, and ever wonder where 4 trillion of Obama's stimulis money disapeared to, try Europe. Run out of other peoples money,and the dominoes fall. Banks, insitutions etc.

  • Len_Powder

    Near retirement, I don't remember any time in my life that the world has had so many problems in so many different places. Most of the attention is focused on the US, Europe, the Middle East and North Africa, but there are issues all over the globe that are under-reported based on the sheer volume of "crises" to be addressed. I am not a prophet but the stability and longevity of the planet have never seemed more fragile to me. Worst of all, mankind does not appear to have the answers or solutions to these myriad problems, advanced university degrees notwithstanding. In fact, it may be the degrees which have created the problems and are preventing the solutions. The world was never perfect but it seemed more rational and predictable when there were fewer highly educated elites in our societies.

  • WilliamJamesWard

    Once leftism is ingrained in the National character the economic problems are
    a given path to failure. Financial failure can change a persons thinking about
    themselves and how they came to be in dire straits but can and entire nation
    living on government handouts survive, I think not. We see what is happening
    in Greece and it will happen here if Obama has his way……………..William

  • Michael Shaw

    It goes like this: if I owe you ten thousand dollars that is my problem, if I owe you ten million dollars that is your problem. Greeks owe bond holders billions of dollars they cannot and will not pay. This is not Greece's problem but the bond holders problem.