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Thread: Greece - Page 5







Post#101 at 07-13-2015 11:48 AM by JDG 66 [at joined Aug 2010 #posts 2,106]
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http://www.wsj.com/articles/twilight...ate-1436296331

Journalists have strained to apply their good guy-bad guy conventions to the Greek crisis. But are the bad guys the greedy, wastrel Greeks? Or are the bad guys the imperious, demanding Germans?

In fact, this narrative is a poor construction. What we’re seeing is less a story of good guy-bad guy than a terminal falling out among Europe’s club of welfare states over the inevitable problem that eventually other people’s money (in
Margaret Thatcher’s phrase) runs out.

The Greek combination of welfarism-plus-cronyism, with a large helping of outright corruption, has long relied on other people’s money from abroad to make ends meet...

...the fundamental long-term problem still remains: How will France and Italy especially (the key too-big-to-fail economies) find their way back to reliance on internal taxation plus voluntary, market-based lending to keep their welfare states up and running?

An old article, but so appropos:

Quote Originally Posted by JDG 66 View Post
http://www.investors.com/NewsAndAnalysis/Article/536668/201006081815/US-Embraces-Model-Thats-Failed-Europe.aspx

If taxes could solve the problem, Greece would be bailing out the U.S.

Taxes currently take a third of Greece's GDP, roughly double the U.S. tax burden. It would be even higher, but the absurdly high tax rates have led to widespread evasion. Greece soaks the rich with a top income tax rate of 40%. It even has a 21% VAT...

Yet, somehow, Greece hasn't managed to tax its way to prosperity. That's because the problem isn't inadequate taxes, it's too much spending...
Quote Originally Posted by playwrite View Post
...It has nothing to do with the relative degree of social programs...
-It doesn't! It just... doesn't! No! No! No!

I'm sure PW would like to explain how Greece spent all that money they borrowed. Bonus points if he can blame this on Bush or Ronald Reagan! Ho hum.

It wouldn't really matter whether the debt was denominated in drachmas, ecus, dollars, or sea shells. The Greek's real problem is that they are running out of money, and they're running out of suckers to lend them more. Having their own currency to devalue would simply have targeted the suckers stupid enough to hold assets denominated in drachmae (most of them Greeks) instead of those stupid enough to hold Greek debt.

Quote Originally Posted by The Wonkette View Post
Funny that you and Paul Krugman both believe that Greece should exit the Euro. Whoda thunk? ...
-Meh.

I don't care if the Greeks leave the Eurozone or not, although that's the likely long-term result.

Quote Originally Posted by Bronco80 View Post
...the euro was more of a political project than an economic one, to try to bring Europe ever closer together. The irony, of course, is that the economic implications are tearing those political goals apart as we speak.
1) Not ironic, exactly. It was easily predictable to anyone who didn't have the agenda.

2) Which is why so many Europeans go to such ridiculous lengths to keep the Greeks in. The ECB has become the sucker of last resort.

QUOTE=herbal tee;528560]The Brits weren't all that hip to join... But ''The Seven'' became ''The Six'' as the concept of little England won out over big England...[/QUOTE]

-And I bet they're just kicking themsleves right now for having missed out on this incredible opportunity.







Post#102 at 07-13-2015 10:32 PM by XYMOX_4AD_84 [at joined Nov 2012 #posts 3,073]
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Quote Originally Posted by JDG 66 View Post
http://www.wsj.com/articles/twilight...ate-1436296331

Journalists have strained to apply their good guy-bad guy conventions to the Greek crisis. But are the bad guys the greedy, wastrel Greeks? Or are the bad guys the imperious, demanding Germans?

In fact, this narrative is a poor construction. What we’re seeing is less a story of good guy-bad guy than a terminal falling out among Europe’s club of welfare states over the inevitable problem that eventually other people’s money (in
Margaret Thatcher’s phrase) runs out.

The Greek combination of welfarism-plus-cronyism, with a large helping of outright corruption, has long relied on other people’s money from abroad to make ends meet...

...the fundamental long-term problem still remains: How will France and Italy especially (the key too-big-to-fail economies) find their way back to reliance on internal taxation plus voluntary, market-based lending to keep their welfare states up and running?

An old article, but so appropos:





-It doesn't! It just... doesn't! No! No! No!

I'm sure PW would like to explain how Greece spent all that money they borrowed. Bonus points if he can blame this on Bush or Ronald Reagan! Ho hum.

It wouldn't really matter whether the debt was denominated in drachmas, ecus, dollars, or sea shells. The Greek's real problem is that they are running out of money, and they're running out of suckers to lend them more. Having their own currency to devalue would simply have targeted the suckers stupid enough to hold assets denominated in drachmae (most of them Greeks) instead of those stupid enough to hold Greek debt.



-Meh.

I don't care if the Greeks leave the Eurozone or not, although that's the likely long-term result.



1) Not ironic, exactly. It was easily predictable to anyone who didn't have the agenda.

2) Which is why so many Europeans go to such ridiculous lengths to keep the Greeks in. The ECB has become the sucker of last resort.

QUOTE=herbal tee;528560]The Brits weren't all that hip to join... But ''The Seven'' became ''The Six'' as the concept of little England won out over big England...

-And I bet they're just kicking themsleves right now for having missed out on this incredible opportunity.
Tax evasion is also an huge issue in Greece. The guzintas can't cover the guzouttas.







Post#103 at 07-14-2015 01:31 PM by playwrite [at NYC joined Jul 2005 #posts 10,443]
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Quote Originally Posted by JDG 66 View Post
http://www.wsj.com/articles/twilight...ate-1436296331

Journalists have strained to apply their good guy-bad guy conventions to the Greek crisis. But are the bad guys the greedy, wastrel Greeks? Or are the bad guys the imperious, demanding Germans?

In fact, this narrative is a poor construction. What we’re seeing is less a story of good guy-bad guy than a terminal falling out among Europe’s club of welfare states over the inevitable problem that eventually other people’s money (in
Margaret Thatcher’s phrase) runs out.

The Greek combination of welfarism-plus-cronyism, with a large helping of outright corruption, has long relied on other people’s money from abroad to make ends meet...

...the fundamental long-term problem still remains: How will France and Italy especially (the key too-big-to-fail economies) find their way back to reliance on internal taxation plus voluntary, market-based lending to keep their welfare states up and running?

An old article, but so appropos:





-It doesn't! It just... doesn't! No! No! No!

I'm sure PW would like to explain how Greece spent all that money they borrowed. Bonus points if he can blame this on Bush or Ronald Reagan! Ho hum.

It wouldn't really matter whether the debt was denominated in drachmas, ecus, dollars, or sea shells. The Greek's real problem is that they are running out of money, and they're running out of suckers to lend them more. Having their own currency to devalue would simply have targeted the suckers stupid enough to hold assets denominated in drachmae (most of them Greeks) instead of those stupid enough to hold Greek debt.



-Meh.

I don't care if the Greeks leave the Eurozone or not, although that's the likely long-term result.



1) Not ironic, exactly. It was easily predictable to anyone who didn't have the agenda.

2) Which is why so many Europeans go to such ridiculous lengths to keep the Greeks in. The ECB has become the sucker of last resort.

Quote Originally Posted by herbal tee View Post
The Brits weren't all that hip to join... But ''The Seven'' became ''The Six'' as the concept of little England won out over big England...
-And I bet they're just kicking themsleves right now for having missed out on this incredible opportunity.
Along with your post, this one simple chart -



- illustrates why "amygdala-dominated thinking" is both an explanatory mechanism of, and just simply another phrase for, "simplistic moron."

Please explain to us how this chart provides a correlation between a country's relative social program expenditures and the relative degree and type of financial problems they have had since the 2008 Financial Meltdown. That should be pretty entertaining.

One who's amygdala hasn't fully overridden their cerebral lobes' rational thought processes would be hard pressed to make such a correlation. But of course, such a person would also not be a simplistic moron.
Last edited by playwrite; 07-14-2015 at 01:35 PM.
"The Devil enters the prompter's box and the play is ready to start" - R. Service

“It’s not tax money. The banks have accounts with the Fed … so, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed. It’s much more akin to printing money.” - B.Bernanke


"Keep your filthy hands off my guns while I decide what you can & can't do with your uterus" - Sarah Silverman

If you meet a magic pony on the road, kill it. - Playwrite







Post#104 at 07-14-2015 05:08 PM by playwrite [at NYC joined Jul 2005 #posts 10,443]
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A good MMT (actually, MMR, but that's another story) perspective -

The Greek economy is undergoing a tragic depression and the core of Europe doesn’t seem to care much. This is one thing we shouldn’t downplay. How we got here is a whole other topic though. It’s common for liberals to view the Greek depression as a result of a public response (austerity, lack of currency sovereignty, etc). Conservatives, on the other hand, say that Greece just isn’t competitive and basically needs to pull itself up by its bootstraps, reduce its debt and be more responsible. There’s probably a bit of truth in both positions, but there’s also some hyperbole in both.

We should be very clear that borrowers and lenders don’t get into trouble by no choice of their own. So, many banks made bad loans (ie, Germany, you screwed up) and many borrowers overextended themselves here (ie, Greece you screwed up).[b] Of course, the problem with the Euro is that highly indebted current account deficit countries are a virtual guarantee as a function of the common currency. And this is where the core’s lack of sympathy is frustrating. They want all the benefits of being the current account surplus countries in a common currency region without having to ever support the current account deficit countries who will, by definition, need some form of redistribution or internal deflationary and depressionary rebalancing as is going on with Greece.[/b[

One can argue that Greece was naive to get into such a currency union without a specific mechanism for rebalancing, but what we’re seeing now from the politicians in the core, given Greece’s 7 year depression, is looking unsympathetic at a best and downright cruel at worst. But make no mistake – Greece is not being treated like a “hostile occupied state” as this Telegraph article claims. They chose to get involved in this currency union and as far as I’ve seen they’ve failed to understand its inherently flawed rebalancing mechanism as badly as the core countries have.

Of course, when you understand the internal rebalancing problem within the common currency system you can’t help but feel bad for Greece. And that’s what makes Germany’s recent actions so frustrating. There will always be “Greece” in the common currency. For instance, if you kick Greece out then someone else will become the heavily indebted current account deficit country on the other side of Germany’s current account surplus. They won’t be able to devalue their currency so they’ll borrow to make up the difference between the lost income outflows and domestic demand. And that will go on until it can’t and Germany will throw a hissy fit at that country and kick them out. Rinse wash repeat until Germany kicks everyone out and returns to the Deutschemark which will trade at a huge premium to the rest of Europe and they’ll likely see a huge reversal in many of the last decade’s positive economic trends…..This is truly a case of Germany wanting to have its cake and eat it too.
You see, in the US, we have a fiscal union, which means a state like mine, NY, winds up transferring money to states like Glick's, TN, that keeps them going through hard times. Essentially, Glick is Greece but since I'm Germany but with a liberal bleeding heart, Glick doesn't have to suffer a depression. Ain't America great!
"The Devil enters the prompter's box and the play is ready to start" - R. Service

“It’s not tax money. The banks have accounts with the Fed … so, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed. It’s much more akin to printing money.” - B.Bernanke


"Keep your filthy hands off my guns while I decide what you can & can't do with your uterus" - Sarah Silverman

If you meet a magic pony on the road, kill it. - Playwrite







Post#105 at 07-14-2015 08:34 PM by Kinser79 [at joined Jun 2012 #posts 2,897]
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Quote Originally Posted by playwrite View Post
A good MMT (actually, MMR, but that's another story) perspective -



You see, in the US, we have a fiscal union, which means a state like mine, NY, winds up transferring money to states like Glick's, TN, that keeps them going through hard times. Essentially, Glick is Greece but since I'm Germany but with a liberal bleeding heart, Glick doesn't have to suffer a depression. Ain't America great!

Actually I would argue that while your statement is true, it also backs up my previous statement that currency unions are only successful after political unions. TN is part of a single federation of states which it cannot by law leave, so is NY. If TN goes down it hurts NY too. As such donor states have an interest in keeping the welfare states going so as to not drag the whole union down with them.







Post#106 at 07-14-2015 09:13 PM by Marx & Lennon [at '47 cohort still lost in Falwelland joined Sep 2001 #posts 16,709]
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Quote Originally Posted by Kinser79 View Post
Actually I would argue that while your statement is true, it also backs up my previous statement that currency unions are only successful after political unions. TN is part of a single federation of states which it cannot by law leave, so is NY. If TN goes down it hurts NY too. As such donor states have an interest in keeping the welfare states going so as to not drag the whole union down with them.
While this is certainly true, it's not insignificant that the same arguments being made in Europe are also being made here ... but in an odd reversal of position. The states that receive the most whine the most about paying taxes and supporting THEM. So the advocates of Germany's position are the very states most likely to be punished if they got their way.

Wisconsin is now suffering, Kansas even moreso, but both are proud of the gains they've made. Go team!.
Marx: Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies.
Lennon: You either get tired fighting for peace, or you die.







Post#107 at 07-15-2015 09:13 AM by Kinser79 [at joined Jun 2012 #posts 2,897]
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Quote Originally Posted by Marx & Lennon View Post
While this is certainly true, it's not insignificant that the same arguments being made in Europe are also being made here ... but in an odd reversal of position. The states that receive the most whine the most about paying taxes and supporting THEM. So the advocates of Germany's position are the very states most likely to be punished if they got their way.

Wisconsin is now suffering, Kansas even moreso, but both are proud of the gains they've made. Go team!.
Oh I'm aware of the situation. I would argue that to a large degree the donor states tend to have large urban centers which are overwhelmingly minority and "blue". The welfare states are largely rural and "red". I think that the concentration of urban centers, and with them access to differing opinions and education may play a large part in why this situation is ass backward in the US. That things of this nature should be ass backward in the US is not surprising though.

The situation in Europe seems to be that the countries cannot understand that for one to run a trade surplus (Germany) others must run a trade deficit (Greece). It is after all this highly complex and convoluted economic theory known as double entry bookkeeping.







Post#108 at 07-17-2015 02:31 AM by JordanGoodspeed [at joined Mar 2013 #posts 3,587]
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Well, so Syriza might have caved (further confirming my general contempt for middle-class leftists), but it seems like Golden Dawn is taking a stand against the bailout terms. This is not unexpected, but since Erdogan is in a bit of tight spot and catering to nationalists too, I can't help but feel that the choice for Greece is rapidly narrowing down to that between being a colony of Germany or, a little down the line, being one of Turkey.







Post#109 at 07-17-2015 02:35 AM by JordanGoodspeed [at joined Mar 2013 #posts 3,587]
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I mean, I'm sure Russia would be bidding as well, but I can't help but feel they're going to have enough trouble a little closer to home.







Post#110 at 07-17-2015 04:20 AM by Ragnarök_62 [at Oklahoma joined Nov 2006 #posts 5,511]
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Quote Originally Posted by Marx & Lennon View Post
While this is certainly true, it's not insignificant that the same arguments being made in Europe are also being made here ... but in an odd reversal of position. The states that receive the most whine the most about paying taxes and supporting THEM. So the advocates of Germany's position are the very states most likely to be punished if they got their way.

Wisconsin is now suffering, Kansas even moreso, but both are proud of the gains they've made. Go team!.
Uh, how about Obama's home state?

http://www.huffingtonpost.com/2011/0..._n_868733.html

That place can't seem to manage its finances at all. It's a tax hell for rich and poor alike. Now if we drill down into budget messes wrt red/blue states, I think we'll find that:
http://wallethub.com/edu/best-states...pective/11257/

1. Red states waste money on things like prisons and create future liabilities from flimsy safety nets. If your SNAP payments are zilch, you are forced to buy trash for food and wind up in the emergency room.

2. Some blue states have pension time bombs going off due to prior promises which now can't be kept.

3. Red states do have a little wiggle room if and it's a big if of getting off the "lower taxes = more business activity".




Last edited by Ragnarök_62; 07-17-2015 at 04:35 AM.
MBTI step II type : Expressive INTP

There's an annual contest at Bond University, Australia, calling for the most appropriate definition of a contemporary term:
The winning student wrote:

"Political correctness is a doctrine, fostered by a delusional, illogical minority, and promoted by mainstream media, which holds forth the proposition that it is entirely possible to pick up a piece of shit by the clean end."







Post#111 at 07-19-2015 11:39 PM by Bronco80 [at Boise joined Nov 2013 #posts 964]
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Quote Originally Posted by Kinser79 View Post
I would argue that to a large degree the donor states tend to have large urban centers which are overwhelmingly minority and "blue". The welfare states are largely rural and "red". I think that the concentration of urban centers, and with them access to differing opinions and education may play a large part in why this situation is ass backward in the US. That things of this nature should be ass backward in the US is not surprising though.
Furthermore, urban centers in general are overwhelmingly blue, even if they're in red states. I'd bet you see this donor/moocher proportion look even more lopsided if you measured by metro areas instead of states.







Post#112 at 07-20-2015 01:54 AM by Kinser79 [at joined Jun 2012 #posts 2,897]
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Quote Originally Posted by Bronco80 View Post
Furthermore, urban centers in general are overwhelmingly blue, even if they're in red states. I'd bet you see this donor/moocher proportion look even more lopsided if you measured by metro areas instead of states.
Cities tend to produce greater wealth than rural areas. That is to be expected. I'm not one to directly call rural areas "moochers" they have their place and their economic production, it is that in total on the federal level cities and the states that have them produce far more wealth (science, commerce, industry, entertainment) than a rural area and the states that are mostly rural can with timber, corn and coal.







Post#113 at 07-20-2015 11:16 AM by herbal tee [at joined Dec 2005 #posts 7,116]
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's
Quote Originally Posted by Bronco80 View Post
Furthermore, urban centers in general are overwhelmingly blue, even if they're in red states. I'd bet you see this donor/moocher proportion look even more lopsided if you measured by metro areas instead of states.
North Carolina is a classic example of that right now as seen by the recent proposed change in how that state's sales taxes are distributed. I can't currently find an updated link on the proposed change but, as I did study public administration in that state I do have some familarity with the issue so I'll explain it as simply as possible.
Briefly, since at least the late 1980's the revenues fro the state sales tax was distributed with 75% of it going to the county that generated the sales and the other 25% being rebated to the counties on a per capita population basis. The formula had a slight favoritism towards the smaller, poorer counties but an argument can be made that if the poor sections of the state get too far behind it's bad for everyone long term as the state's physical infastructure degrades and the poor quality schools lower statewide test score averages, ect.. And to be fair NC has been a very successful state over the last few decades. The 75/25 formula has kept the cities flush enough to fund their bonds while giving the poor counties better outcomes than the so called invisible hand would lash on to them.

But after the 2010 election the Tea Party GOP faction took over the state legislature. And the state Senate is particularally dominated by rural reactionaries. They wish to kill the 5 geese ie. urban counties thatt lay the golden eggs. They want to do this by changing the formula for distributing the state sales tax to a 50/50 basis. And this will mean that the five most populous counties in the state, the ones with the big cities namely Mecklenburg (Charlotte), Wake (Raleigh), Guilford (Greensboro), Forsyth (Winston-Salem) and Durham, which with their large malls and busy center city business districts generate about 50% of all sales tax revenue while having about 30% of the state's total population. So of course this rural redistribution is going to squeeze the budgets of the urban counties and their center cities....And most of the Democratic minority in the state leg. of course comes from the 5 big urban counties.

Greed. I'm sorry but no one is going to move to swampy Pasquotank County just because they get a bigger cut of a pie that may now shrink as the cities get fiscally looted. And I suspect that moves like this have been going on in other states where the Tea Party took over after 2010.
Last edited by herbal tee; 07-20-2015 at 12:07 PM.







Post#114 at 07-22-2015 12:23 PM by JDG 66 [at joined Aug 2010 #posts 2,106]
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http://www.realclearmarkets.com/arti...on_101741.html

European leaders should realize that Greek Prime Minister Alex Tsipras' surprising last-minute offer of reforms in return for additional bailout financing is a con. The only real question is whether Tsipras is himself in on the con that he is pitching to his nation's creditors...

The key point is that a bailout agreement would restore European Central Bank (ECB) "Emergency Liquidity Assistance" (ELA) to the Greek banking system...

While anything is possible, it is hard to imagine that Tsipras has not figured all of this out...

Tsipras is proposing that Greece's European creditors provide money now in return for reforms later. Many of his proposed measures would be phased in, and all of them would be reversible at any time, at the whim of the Greek government...

...if Greece could achieve and maintain 1.72% real economic growth, its current debt load would be sustainable. No "haircuts" on existing debt would be required. Unfortunately, Greece's real GDP (RGDP) growth rate over the past 6 years has been -5.24%...

Quote Originally Posted by playwrite View Post
...this one simple chart...
...it is a simple chart which shows total GDP but doesn't mention per capita GDP. And even accounting for that, is Playdude really arguing that the countries that waste of of their money on social welfare crap aren't heading in the same direction?

Quote Originally Posted by Marx & Lennon View Post
The states that receive the most whine the most about paying taxes and supporting THEM...
-Rubbish. The states where people get something for nothing tilt proggie, not conservative/libertarian.

Quote Originally Posted by Marx & Lennon View Post
...Wisconsin is now suffering, Kansas even moreso, but both are proud of the gains they've made...
Yeah, they're really suffering. What hell-holes.

Tell me about CA and IL.
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