Greece plans referendum on austerity measures

WildCat said:
When you're begging for other people's money you don't get to negotiate the terms.

Why should the taxpayers in the rest of the Euro zone suffer so that the Greeks who caused their own problems don't have to face up to them? If I'm a German I have no sympathy for Greeks living well beyond their means with my money.

Greeks made their own bed, sooner or later they'll have to lie in it. Closing their eyes and pretending this isn't happening won't make things any better, in fact it will only get far worse than it will be under the austerity measures.
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I don't disagree, I just think that it might be a motivation for calling for the referendum.

Unfortunately, whatever decision the Greeks end up making, it still impacts on the rest of the global economy, witness the falls in stock prices today.
 
WildCat said:
Exactly, and the affects on the Argentinian people were quite extreme, much more so than the austerity measures the Greeks are protesting.
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Arguable.

As Greece Ponders Default, Lessons From Argentina

Despite the financing challenges, Argentina’s economy has grown by more than 8 percent a year since 2003, and many industries have benefited from the devaluation. Argentina has resumed exporting cars to Brazil. Tourism has flourished from an influx of Brazilians and other foreigners.
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Puppycow said:
Arguable.

As Greece Ponders Default, Lessons From Argentina
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How does that change anything? Argentina went through a lot of pain before things started getting better. And the world economy was in much better shape in the late 1990s than it is today, it's not likely that Greece can pull out of it as fast as Argentina did, particularly if they reject the asterity measures Argentina had to implement. Argentina also has a thriving export agriculture industry with which to get hard currency, what does Greece have to export? There's only so much olive oil.
 
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WildCat said:
How does that change anything? Argentina went through a lot of pain before things started getting better. And the world economy was in much better shape in the late 1990s than it is today, it's not likely that Greece can pull out of it as fast as Argentina did, particularly if they reject the asterity measures Argentina had to implement. Argentina also has a thriving export agriculture industry with which to get hard currency, what does Greece have to export? There's only so much olive oil.
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Yeah, but it's not obvious which pain is worse. The pain was sharp, but after that the recovery was rapid and sustained. With austerity, it's not clear how they get out from under the crippling levels of debt. It's projected to be still 120% of gdp in 2020. Argentina had a bad year or two, but then a rapid recovery. Greece could be suffering under heavy debts for decades.
 
Puppycow said:
Yeah, but it's not obvious which pain is worse. The pain was sharp, but after that the recovery was rapid and sustained.
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At least partly because of the emerging boom market in commodities. Argentina is an enormous agricultural producer, and it has rich metal deposits along with some oil and gas. Greece has some olive gardens and a couple of goat herds; it's a beautiful country, but really resource-poor.
 
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The Greeks might also consider perhaps actually paying some taxes as well.

It does seem that there needs to be a re-education process. I can't tell how much of the Greek public's position is about hoping that there won't be cuts or whether there is a real expectation that *somehow* expenditure will magically come into line with receipts. As those wiser than me have pointed out, there's a big difference between running a surplus before loan repayments are taken into account and running a loss before they are. Even if the Greeks owed nothing IIRC they'd still have a significant deficit.
 
Puppycow said:
Anxieties Stir as Greece Plans Referendum on Latest Europe Aid Deal



So, what's the over-under on Greece still using the euro as its currency a year from now?
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It's a virtual lock that they won't IMO.

I was surprised by Papandreou doing this at this late date. I'm not sure what's going on in his head. Does he really think the people are going to change their tune just because he put the ball in their court?

It's a lose-lose situation IMO from Greece on out. A better question might be, what's the over-under on Papandreou being prime minister for much longer?
 
Archer17 said:
It's a virtual lock that they won't IMO.

I was surprised by Papandreou doing this at this late date. I'm not sure what's going on in his head. Does he really think the people are going to change their tune just because he put the ball in their court?

It's a lose-lose situation IMO from Greece on out. A better question might be, what's the over-under on Papandreou being prime minister for much longer?
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Maybe he wants to be able to retire and continue living in Greece without being hated by the population.

The referendum won't save Greece, might not save the Euro but it might take some of the sting out of anti-Papandreou sentiment. After all, now it is up to the people to choose their future...
 
WildCat said:
Which will put them right where Argentina was in the height of their crisis, hyperinflation and all.

I hope Greece is self-sufficient in food production, at least Argentina had that going for them. Going to be hard to import food and oil using the drachma.
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They did amazingly well, considering, during and after World War II. There's still a reliance on small farms rather than factory farming, which should help. Of course, it may also be a reason that they are in this mess in the first place.
 
WildCat said:
Exactly, and the affects on the Argentinian people were quite extreme, much more so than the austerity measures the Greeks are protesting.

They can suffer a little, or they can suffer a lot. Unfortunately, a large segment of the Greek population thinks they can get out of this pain-free, and that simply is not going to happen in this universe.
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It won't just be the Greeks suffering though. The global economy is daisy chained in this ongoing debt crisis. Local and regional leaders are putting out local fires when it's the entire international debt structure that needs addressing.

If the Greeks leave the Euro (and perhaps even the EU entirely), then watch Portugal, Spain, Italy (already weak) and Ireland follow in short order. Then watch as the resultant surge in skepticism about gov't debt torpedo the entire system as major nations are drug down in the ensuing financial chaos.

BTW, the Germans are already threatening Greece's Euro status:

http://news.yahoo.com/german-parliament-leader-irritated-greece-move-070844730.html
 
Puppycow said:
Arguable.

As Greece Ponders Default, Lessons From Argentina

Quote:
Despite the financing challenges, Argentina’s economy has grown by more than 8 percent a year since 2003, and many industries have benefited from the devaluation. Argentina has resumed exporting cars to Brazil. Tourism has flourished from an influx of Brazilians and other foreigners.
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Cold comfort to all the lower class Argentinians who had to go hungry and sick because their currency became so much toilet paper.
 
What we need is a jolly good war.

Who can we invade.
Someone with money , but not a million man army.

France?
 
The Don said:
The Greeks might also consider perhaps actually paying some taxes as well.
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And doing something about the corruption which is worse than some Eastern European states. It's bad for entrepreneurship and investment.
 
Humes fork said:
But they currently have a social democratic party in charge.
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I realize that. The point I was responding to was the observation that it would be hard to push a tax increase through in their current environment.

I made the observation in reply that it would be doubly difficult if they had some sort of psuedo-populist movement actively campaigning against said proposal a la the Tea Party here.

We need look no further than recent US history to see what kind of damage such a party can do if it even gets a significant minority position of power.
 
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