Greece’s Debt Isn’t Solved

greek-EU-flagsA progress report on the new EU mechanisms set up for “supervision and solidarity” in the post bailout program era, addresses the tight fiscal and regulatory framework in which Greece is asked to deal with its persistent economic and structural problems.

The report which is published by the members of the Budget Office of the Greek Parliament reveals that Greece has not yet overcome its serious financial problems. As a result, new fiscal rules are necessary for the eurozone, based also on the intention of Greece to remain within the euro and not to return to its previous currency, the drachma.

“Every future Greek government, irrelevant of whether a new memorandum will be signed or not, will have to operate within the new regulations of financial and fiscal policies,” mentions the report, while explaining that the Greek public debt of 170% of the GDP will lead sooner or later to higher taxes being implemented, which in turn will curb any growth perspective.

The report argues that the new governmental priorities lead to the GDP rate being dropped and to a dramatic increase in unemployment. In the past years, the GDP drop had an “avalanche effect” by making the implementation of reforms increasingly difficult and unlikely to have permanent results.

Under these circumstances, the Budget Office considers the debt problems of Greece (and of other countries with similar debt problems) to be unresolved. Therefore, Greece won’t be able to reduce its debts without any further assistance, but notes that any additional austerity measures will only worsen the situation.

The report concludes in saying that “every member state should legislate and observe a balanced budget” (the golden rule) and predicts that when Greece publishes its midterm plan for 2014-2016 by late April, it must include measures that will “ensure a fiscal balance after the current bailout program ends, in order to demonstrate the country’s commitment to the European framework.”


  1. The latest product from the EU spin machine now is “supervision and solidarity”. These buzz words have absolutely no meaning upon the actions of sovereign nations. This demonstrates Brussels’ total disregard for the interest of a nation’s best interest and smacks of desperate Euro-totalitarianism.

  2. “Greece is back.” “The worse is over.” “Greece will enter international markets this year 2014.” PM of Greece. Antonis Samaras
    Greece will never ever pay back 500 Billion euros in loans.
    The sooner they exit the eurozone the better.

  3. “. . . explaining that the Greek public debt of 170% of the GDP will lead sooner or later to higher taxes being implemented, which in turn will curb any growth perspective.”

    Well that’s very encouraging news to us honest souls who willingly throw all our exorbitant taxes down a huge sink hole. Meanwhile, according to a recent article in Kathimerini, 54, 000 people in Greece moved 54 billion euros abroad from 2008 to 2011 alone. This was a tax reliability of 22 billion never paid. The article goes on to inform us that only 266 of the 2062 Greeks named on the Lararde List have so far been investigated. Why?

    Now logic would tell you that the government would want to expedite this investigation to try to get a portion of that much-needed money (the State’s money) back. Right? Just six of those Largarde cases had in their accounts 10 million euros not legally declared to authorities. That would be a f*cking gold mine to any other government looking for ways to pay back their debts.

    But we all know why they are dragging their feet–it is so much easier and favorable to them to take the funds out of our paychecks rather than their and their friends’ bank accounts.

    As usual, according the report above, the honest citizens of Greece are just shoveling sh*t against the tide. How much longer are we willing to participate in this Sisyphean tragedy?

  4. “while explaining that the Greek public debt of 170% of the GDP will lead sooner or later to higher taxes ”
    Poor Germans,taxed to death to pay the Greek exuberant salaries and 50-something retirements.

  5. Have to love how you use “they” in reference to Greeks. In other words you are not Greek but come here outragioiusly calling for Greeks to murder other Greeks. Nazi.

  6. It takes time to audit thousands of people (who aren’t the only ones facing audits) but the Legarde list is being investigated by the current administration. What’s ironic about that list is that most of those that complain about that list (typically left leaning)… is that the list wasn’t being investigated by the prior *leftwing* administration (which most of them supported at the time). Even more ironic is that most of names on the list and most tax cheats appear to be left wing affiliated.

    As for your point that some how the rich are to blame for Greece’s economic problem, rich people (in every country) have a much higher tax burden than middle class and poor so claiming “it is so much easier and favorable to them to take the funds out of our paychecks rather than their and their friends’ bank accounts.” simply isn’t true. The rich pay far far more than you and I in taxes and contribute far more to our economy.

    Greece’s problem is that we are unproductive (imo due to a lack of technology) were overspending and a fair chunk of the population (rich and poor alike) were evading taxes. Turning it into a rich versus poor thing is the sort of language communist populists use. There are certainly rich crooks too but there are plenty of crooks in the middle class and poor too.

  7. Sorry but Greece has a total disregard for its nation. They destroyed their own country and have ruined their reputation. The elite have taken no responsibility or accountability. Without Brussels Greece would be much worse off. The Germans saved you. Greece controls state owned companies and the banks that have lent Greece money. They hold Greek bonds in their pension funds, in bank reserves, and the corrupt government made many bad loans to their friends and these state owned entities. And you blame Brussels? Without the bailout loans what would have happened to these bond holdings? Your government does not have the competency or morality to govern a nation.

  8. Brussels cannot dictate terms of financial capitulation. These guarantees are specific to Greece only and not EU policy. It is a means to collateralize to loans which means Brussels would own Greece. The best method would have been Greece to default and revert to the drachma years ago instead of allowing the debt to balloon. But here again Brussels and Berlin were not about to let go and with the cooperation of ND and PASOK allowed the borrowing and spending to go unfettered getting deeper and deeper in debt. A look at the shambles of Greece today that is the product of its own selfish politicians and useless Eurocrats should be ample cause to leave the EU.

  9. I agree Greece should never have been accepted into the euro for obvious reasons. But leaving a few years ago would have been much worse for Greece. There was no choice.

  10. By saying the rich make a greater contribution to the country with their taxes may be true in theory–yet which group hides and misreports the larger amount–rich or poor? This keeping enormous amount OUT OF the coffers that should be there. Who is actually on the Lagarde List–rich or poor? The rich are the most damaging tax cheats to the system over all. Don’t you remember just before the crises when they were exposing doctors in Kolonaki–claiming 6,000 euros net pay for the year? And the scores of Lawyers nd entertainers who hid millions per case? I just don’t buy your argument–the big fish hurt us more when thy cheat.