Software Devs Leaving Greece For Good, Finance Minister Resigns

New submitter TheHawke writes with this story from ZDNet about the exodus of software developers from Greece. "In the last three years, almost 80 percent of my friends, mostly developers, left Greece," software developer Panagiotis Kefalidis told ZDNet. "When I left for North America, my mother was not happy, but... it is what it is." It's not just the software developers quitting either. The Greek Finance Minister Yanis Varoufakis also resigned. A portion of his resignation announcement reads: "Soon after the announcement of the referendum results, I was made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my ‘absence’ from its meetings; an idea that the Prime Minister judged to be potentially helpful to him in reaching an agreement. For this reason I am leaving the Ministry of Finance today."

Comments

News flash: employees in demand move

[Anonymous Coward]

Umm, I lived in Vancouver Canada for 10 years as a software developer and me and most of my software developer friends ALSO moved to the US (I currently work for Apple, most work for Google or other local companies). Greek developers may have an extra incentive to move, but they are hardly unique.

Re:Outside help

[Reemi]

A developer working in Greece will pay taxes in Greece and spend most of his/her income in Greece.

A developer leaving Greece will not pay income tax in Greece and IF he/she sends back any money it is nothing compared to what he/she would earn in Greece. Furthermore Greece paid the developers education in the expectation it would be a wise investment in the future (education == long term investment).

Note, in case this developer is doing work for a foreign company, this adds to Greece export and the differences are even larger.

Sorry, the helping out relatives story is not in the interest of Greece.

Varoufakis

[MightyMartian]

I think it's pretty clear Varoufakis was turfed by Tsipras because the only hope in hell Greece now has of negotiating a deal with the Troika and remaining in the Eurozone and even in the EU is not having that man by his side. The price of even talking about a new deal and further bailouts is Varoufakis's head, which has been delivered to Merkel on a silver platter. This referendum was completely about Tsipras's political survival, and having achieved that, Greek voters will now witness just how utterly irrelevant the referendum was.

Re:Varoufakis

[NotDrWho]

My guess of they they'll turn in desperation to Putin, thinking he's going to help them (as he's going to promise). And he's going to screw them in ways they can't even imagine.

Re:Varoufakis

[HornWumpus]

NATO membership is going to be a problem.

Can Putin even afford to pay as much as they are currently getting from NATO, particularly from the NATO troops stationed in Greece.

Re:Varoufakis

[Chris Mattern]

Putin can't afford to pay anything--Russia's broke too (if not quite as broke as Greece). But if they're stupid enough, the Greek government might not figure that out until it's too late.

Re:Outside help

[Anonymous Coward]

"A developer working in Greece will pay taxes in Greece"

No he won't. That's why they're in this mess.

So long and thanks for smelling like fish

[NotDrWho]

"Adios, suckers!" the Finance Minister screamed as he hit his secret eject button.

Re:So long and thanks for smelling like fish

[Anonymous Coward]

That's exactly the point: Greece has for a very, very long time been a two party system, both equally guilty of the current mess, hence the reference to the "Republicrats". This minster of finance and the current regime are not related to them at all. Could they have done a better job? Probably. Could the rest of the EU handled the situation better? I could hardly see how they could have done any worse. Their actions reek of racism, colonialism among other things, supported by a concerto of propaganda and outright lies. A shameful display indeed.

And btw, the problem isn't that they want to keep the Euro as such, it's among other things the horrendous state their institutions are in, and the fact that the main effect of the Euro is to prevent the Germans from pricing themselves out of the market with a ridiculously strong currency. The Euro creates tensions between strong economies and weak ones, and there is no way of easing them. And when the inequalities finally isn't manageable anymore, guess who suffers? Greece, or Germany.. Which I guess is the main reason why we see all this bullshit about early retirement, or the Greek people being inherently lazy and inferior: It's much easier and less dangerous to the big economies in the EU to sell those myths than admitting that the Euro is a failure and has built in faults which in its current state can not be mitigated.

Finally, the rock and the hard place isn't the Euro or not, it's being ordered to shut down their already poor economy in the name of "austerity", which by the way nobody believes is the cure for this disease anymore, that thesis is completely discredited. (That it's still on the table is a matter of prestige and saving face for a lot of big wigs who bought into it because it reminded them of their household budget. It was so neat. Simple, easy to explain to the voters, and best of all, someone else's fault.) So the "troika" on one hand forces the Greeks to gut their economy, such as it is, while at the same time ordering them to pay back loans which they already have to loan money to pay off. This is textbook colonial power behaviour, and how on earth anyone could possibly believe that would play out in any other way than it has, is beyond the pale.

Re:So long and thanks for smelling like fish

[BasilBrush]

Varoufakis told it like it is. That's not being an asshole, that's being honest.

Re:So long and thanks for smelling like fish

[0111 1110]

I do think it was in Greece's long term interest to essentially treat their loans as if it was a bank heist and keep the money. I don't know why people have trouble understanding this. Greece managed to steal literally billions from Germany and France and have gotten away with it completely. The Greek people, at least the ones who voted no, are all morally equivalent to bank robbers.

People who lent money to them were just suckers and fools. Germany and France have been scammed. Try not lending money to people who obviously will never be able to pay it back or who at least have no real intention to do so. I mean duh. It was essentially aid rather than a loan. Just an issue of semantics at this point.

What will happen to Greece now? In the short term it will be a mess, but once Greece realizes that money cannot magically materialize out of thin air, at least not the sort of money you can buy actual goods and services with, they will be better off and will be more likely to have a real future, a real economy. They are the same as the rest of us in their economic policies. They just have less productivity for their government to leech off of. To expect such policies to end in anything other than this outcome eventually is ridiculous. It's just simple logic or as the Puerto Rican Governor so famously said, "math".

Greece was the canary in the coal mine. Keynesian borrow and spend economics never made sense. The same logic of living your life entirely from getting more and more credit cards has to end at some point. Greece and Puerto Rico are merely the most egregious examples and will be just the first to tell creditors to go fuck themselves and learn to stand up on their own feet or become the third world countries they so richly deserve to be (looking at you Greece and Puerto Rico). The sad part of this is after some time has passed the lenders with short memories will jump at the chance to lend money again to these people who again will borrow more and more money using one credit card to pay off another, until it all comes crashing down yet again. These dumb bankers never learn. Just look at Argentina.

Re:Outside help

[Ryanrule]

be rich, or have a bitch. pick one.

Re:Economic turmoil does not breed confidence

[PRMan]

It's all Greek to you?

Spending cuts one way or another

[roman_mir]

This 'no' vote self-imposes the spending cut that Greece hates to see but the 'yes' vote also imposes the spending cut. There is no way to avoid a spending cut for Greece.

Austerity is a strange word, it sounds sterile, it has strange connotations. The correct term is spending cuts.

You cut spending if you cannot afford what you are spending on and when you cannot borrow to spend either and in case of chronic offenders the sooner the creditors realize what they are dealing with the healthier for everybody. It's healthier for the spender, who has to come to terms of the impossible situation he is in and it is healthier for the creditor, who will avoid losing even more money. It is healthier for the overall economy not to have welfare State system in the first place, to have people consume based on what they produce and not based on what can be taken from somebody else without any form of repayment.

Real money does not come into being by magic, it is not printed into existence, it is not magically created on a computer. Real money is the result of productive activity, where the word 'productive' really means that something is being produced that others are voluntarily willing to trade for in a way that is sustainable for both, the producer and the consumer.

The world has been playing with fire for the last 100 years with everybody being on fiat, it's been playing with a gigantic fire since the USD became uncontrollably inflationary due to it not being backed by any production (USA has been running half a Trillion USD trade deficit for over a decade now) nor by any money reserves (USD is not backed by gold, Nixon defaulted on the dollar back in 1971, and that's how these problems of inflationary policies and welfare state accelerated).

USA has its own version of what is Greece experiencing right now, that's what 'debt ceiling' is. Many believe that USA can simply print bonds and sell them and get out of jail free, however this only works as long as somebody buys those bonds and the bond market is the biggest bubble of all. USA will have its own currency crisis and bonds are currency promised into the future, so that will also collapse.

As Germany now refuses to just pour money into this bottomless pit called Greece, people will refuse to just pour money into the bottomless pit called USA and that will be even more interesting to observe.

Everybody who tells you 'austerity does not work' are full of it. Austerity means you are not spending money you didn't earn and especially where it concerns consumption rather than investment, and ALL things that people want government to spend on are consumption and not investment, so the important distinction is this: government must be austere, only government austerity can reallocate the scarce resources to people, who will rebuild the economy.

In the long run Greece is better off because of this spending cut, it will learn to live within its means and maybe to produce more and it will have a healthy economy. But like any alcoholic or drug addict apparently it will have to hit the rock bottom before it will reform.

Re:Spending cuts one way or another

[Anonymous Coward]

The bold tag doesn't make your nonsense correct buddy. What's going on has nothing to do with the gold bug horse shit you're spouting. Fiat currency is here to stay and if you're Edison-like ability to completely misunderstand the concept is irrelevant to the Tesla-like power the Fiat currency based systems have.

Crooked banks made bad loans to the crooked leaders than ran Greece, all because they thought the EU would bail out the country no matter what to protect the Euro. (And they'd make piles of money when it happened) Well, that didn't happen a whole lot of said crooked banks are facing a cascading collapse that will make the EU banking system more or less insolvent.

Said bankers are laying in HARD to the rest of the EU leaders to basically economically rape Greece's citizens with comfortable euphemisms called "Austerity", spinning racists stories about lazy entitled citizens. The Greek citzens, for once, are doing something sensible. They threw out the previous government and are saying "We've decided not to pay for the mistakes of banks and Con men. Go fuck yourselfs."

Get ready for a bank Collapse and a whole lotta nationalization. It worked for Iceland, after all.

Re:Spending cuts one way or another

[pipingguy]

"Real money is the result of productive activity, where the word 'productive' really means that something is being produced that others are voluntarily willing to trade for in a way that is sustainable for both, the producer and the consumer."

And the value of the work that humans do now has been reduced due to automation and robots, yet costs of living remain high (for the most part). Former blue collar workers were able to transition to "white collar" work (much of it of dubious value to begin with, and many jobs existed simply due to interdepartmental rivalries and empire-building activities of executives) decades ago, but now there's nowhere left to go as human knowledge, experience and skills are being built into software/hardware. Yes, there are/will be some jobs building and maintaining automated systems, but nowhere near the amount of jobs eliminated. It's not going to be pretty, the middle class will be much more than decimated and I foresee many ditches being dug and then refilled the next day...

Re:Spending cuts one way or another

[Anonymous Coward]

From your comments, it's obvious that you don't understand what money is.

Money is an IOU.

That's it. There's nothing magic about it. The IOU issuer's ability to repay the IOU is the only thing in question. In this regard, the US and its dollars (IOU's printed in green and black, and again, not magic) are not going anywhere.

A government, at its inception, has nothing but promises of infrastructure and protection. It buys its supplies with IOU's. Then it provides community infrastructure and military protection. This proves its worth and provides the "backing" for those IOU's. At the end of a set period of time (a "tax year", if you will), the IOU-holders are expected to forgive some of that debt. The government takes back some of its outstanding IOU's from each debtor. The cycle is complete and begins anew. Non-payers can expect to face a militarized force's demands for payment.

If you layer on centuries of bureaucratic shortcuts and institutionalization of the mechanisms therein, you'll get what we have today. But it all started out with a very basic, very simple premise: a break-even business loan.

Now, think about what the USA (or Greece) provides to its citizens. It provides governmental services. It deserves payment for those services in the form of forgiveness of its debt. If this year's payments don't cover the costs of next year's services, well, that's expansion and they should take out a bigger loan (print more IOU's). But if this year's payments don't cover the costs of this year's services, then they need to raise prices, use their military to make sure payment is collected, or both.

The backing of a currency is not a physical resource, it's a measure of trust in the provider of said currency.

This holds equally true for Bitcoin, which is why Bitcoin is going to be a quaint footnote in computing history in a few years. Nothing backs it. Math is discoverable and essentially worthless as a backing. It's like collecting tree leaves and calling them money. You can grab them from just about anywhere, and there's technically a finite number of them. But nobody's going to give you anything in trade for them. (Except maybe a damned good kicking, which you'll deserve.)

Re:Spending cuts one way or another

[monkeyxpress]

USA has its own version of what is Greece experiencing right now, that's what 'debt ceiling' is. Many believe that USA can simply print bonds and sell them and get out of jail free, however this only works as long as somebody buys those bonds and the bond market is the biggest bubble of all. USA will have its own currency crisis and bonds are currency promised into the future, so that will also collapse.

That is what the austerians want you to believe. The reality is that the USA will never have trouble 'selling' its bonds, because the federal reserve just buys them if nobody else will or it wants to drive down interest rates. This is precisely how the fed controls interest rates normally, and is the basis for quantitative easing. There is no possibility of the USA having a problem with its bonds because it can keep printing money until the economy takes off (at which point it would just create inflation).

The reason the austerians promote this message though, is that none of this comes for free. All this extra money will either cause an asset price bubble, which will wipe out all the savers money, or if that doesn't happen, massive inflation when the economy picks up. Either way savers are going to be paying for all that govt deficit spending in a macroeconomic rebalancing.

And that is what this conflict is about. Essentially the fed, ECB, BoE are saying to savers go and spend your money, stop hoarding it. But savers are not listening so aggregate demand is still broken. The debate now is whether the govt just goes and starts spending their money through QE funded deficits until they get the message, or just puts its hands up in exasperation and leaves things to stagnate for 20 years like in Japan. Obviously what you think is the right answer depends on whether you are a saver or borrower, though there is a clear best answer for the economy in general.

Re:Spending cuts one way or another

[roman_mir]

The reality is that the USA will never have trouble 'selling' its bonds, because the federal reserve just buys them if nobody else will or it wants to drive down interest rates

- I absolutely agree with you, which is why the bond collapse will happen as the result of the currency crisis, which will result from this inflation.

Essentially the fed, ECB, BoE are saying to savers go and spend your money, stop hoarding it. But savers are not listening so aggregate demand is still broken.

- of-course people don't want to spend on bonds and stocks that is the 'demand' we are talking about, let's be clear about it. People are not buying the bonds and stocks that governments want to see selling.

The reality is that the inflationary policy is destroying the economy and a destroyed economy will collapse in its own right, the currency collapses because of the government spending that the mob wants and the economy collapses due to this gigantic misallocaiton of resources. The currency collapse triggers the bond market collapse, since bonds are currency promised in the future.

Japan is stagnating specifically because it is inflating like the USA but its currency is NOT the so called 'reserve', and so the inflation that Japan is producing stays within its own borders, it's absorbing its own inflation and destroying its own economy.

The USA is using the status of the 'reserve currency' to spread the misery around, spreading inflation is national past time, the biggest USA export is its inflation, which creates inflation everywhere else before taking home back to the USA. This is happening of-course anyway, it's manifesting itself as destruction of the productive sector, gigantic real unemployment, class warfare, bubbles in everything everywhere.

The 0% Fed's interest rate for 7 years put USA economy on the inflationary needle and this drug will not be kicked without a huge collapse first, no junkie kicks his habit before hitting the rock bottom.

The clear best answer for the economy in general is free market and removal of government from money and interest rate manipulation, abolition of the welfare state and restructuring of all debts. Whether saving is worth more than borrowing is a question to the healthy free market, something that USA lost long ago.

Re:Outside help

[TWX]

be rich, or have a bitch. pick one.

Try not marrying someone whose goal in life is to be a housewife or otherwise taken care of. Marry someone that is accustomed to taking care of themselves. Trouble is, that trait is generally not initially obvious or especially sexy in of itself, and most people don't think with their brains when it comes to objectively evaluating those that they are sexually attracted to. I had plenty of girlfriends that ultimately weren't suitable to marriage before I found the right woman that knew how to manage her own life and its costs.

Re: Yeah, software developers.

[BarbaraHudson]

That would be redundant as they just voted to screw themselves far worse than you ever could. If

Re:Democracy

[gstoddart]

From what I can tell, nobody knows WTF it means.

The Greek government thinks that the will of the people now means they have more leverage to negotiate.

The problem is they're asking for handouts and free money from other governments who have to explain to their citizens Greek pensions are being funded by everybody else.

Greece is essentially bankrupt, and wants more money. So either every other EU government is going to throw even more taxpayer money into the pit which is Greece's economy, or they're going to tell Greece to piss up a rope.

This sounds like someone having their house foreclosed demanding the banks forgive their debt, lower their interest rate, and give them more money to pay bills.

In other words, it sounds like the Greek government is living in a fantasy where everybody else pays for their society.

And I'm not sure that's gonna happen.

Re: It's like Venezuela but without all the gun cr

[jonnyj]

Seriously! Have you made any attempt to understand this problem?

Former Greek governments borrowed the money, not bankers. Most of the money wasn't lent by bankers. The troika comprises the EU, the IMF and the European Central Bank - mostly politicians, not bankers.

The current problem facing Greece is that no-one will lend them any more money. Even if 100% of their past debts were written off, current tax receipts are insufficient to meet current expenditure. Without more money from the people you mistakenly call bankers, austerity in Greece will become much worse.

Put the blame where it really lies. Not with bankers, but with dishonest politicians and a delusional electorate who always believed someone else would pay their bills.

Re:It's like Venezuela but without all the gun cri

[bobbied]

Yes Socialism...

The banks are not the cause of the problem here, but the symptom of the sickness that's killing Greece (and countries in similar situations). Greek banks WILL fail. They don't have stacks of euros to stuff into the ATM's and the people of Greece are desperately trying to empty their accounts because everybody knows that if you leave your cash in the bank, you won't get it out. Everybody wants to be in hard currency, euros. The banks have run out.

Ask yourself, how did Greece get to this point? Basically it's because they failed to make the most recent payment on their national debt. There isn't enough euros in the government coffers to make the payment, they defaulted and now they cannot borrow because nobody wants to lend them anything. Why is the government in Greece at this point? Because they SPENT money they didn't have and cannot raise. Normally countries just print more currency to pay loans, but you cannot do that when it's euros you need to print.

So what did Greece spend all this money on? Early retirement for everybody and social programs. Socialism in leaning, if not actual practice is what has Greece into crushing debt.

Greece is being crushed between the Eurozone and their debt, the debt that funded their social programs. The sad part though is that the people who will really pay for this are the poor, the people who didn't have the ability to move their assets OUT of Greece.

Re:Democracy

[serviscope_minor]

The Greek government thinks that the will of the people now means they have more leverage to negotiate.

Well, in a sense they do.

The argument is something like "we have $200 billion of your money and we ain't gonna give it back. If you ever want to see it again you better talk".

Let them go, they will come back.

[140Mandak262Jamuna]

Movement from India to USA used to be a one way street. Indians come over, become hyphonated Americans, to borrow Jindal's phrase, and stay. That was the norm till about 2000. Then it began to change. Most of the top grads from IITs and IIMs, no longer are coming over. Those who came, many have left, returned back to India to start companies over there. The ones who came over, learnt the system here, some got US degrees, some did not, established connections, then lots of them returned.

Not all of them returned, heck not even most of them returned. But risk-tolerance, ambition etc are not distributed uniformly, it follows the power law. So the 20% who returned took with them 80% of the risk-tolerance, ambition, entrepreneurship with them back to India.

So let Greece give up euro for drachma, let drachma fall as low as INR. It will thrive on tourism, and the Greeks coming back to start companies a few years down the road.

Germany has benefitted a lot by the economic union. Had Deutschmark stayed out of euro, its exports would have become so expensive no one could import them. 80% of Germany's exports are to rest of Europe. Capital would have naturally flowed to less expensive countries, and they would have the companies and employment restoring the balance. Greece leaving euro is going to be a bigger blow to Germany than to Greece.

Re:It's like Venezuela but without all the gun cri

[amiga3D]

The poor really don't have assets. The people who will really pay is the people who aren't rich but not poor either. Those who have money they put away for their later years and other needs will lose it. I feel sorry for them but there is little hope and it's going to get worse. The US will be in the same place in a decade or so. I have a retirement I'll probably never see.

Re: It's like Venezuela but without all the gun cr

[Curunir_wolf]

Even if 100% of their past debts were written off, current tax receipts are insufficient to meet current expenditure.

That situation is exactly the same in the US (except the gap is about $500 billion right now, more than the entire Greek debt). The only reason that the US keeps going is that they control the lender (the Federal Reserve). At least they think they do.

Re: It's like Venezuela but without all the gun cr

[codealot]

Sorry, but you are incorrect. Greece reported a nearly 2 billion euro surplus in 2014, without taking interest payments into account. http://www.wsj.com/articles/greece-misses-target-on-budget-surplus-1421244654

If their debt were wiped out today they would keep that money and need no further bailouts. Better yet they could go back to the Drachma and manage their currency with a combination of monetary and fiscal policy, just like every other sovereign nation in the developed world.

You can't oversimplify the Greek situation as "socialism". There are plenty of examples of countries that are doing fine economically with policies that embrace social spending. The Greek situation is far more complex and involves politics and the Euro as much as anything else.

Re: It's like Venezuela but without all the gun c

[jonnyj]

Sorry, but you're out of date. The Greek government's primary surplus disappeared shortly after the election of the Syriza government.

Re:Outside help

[Tailhook]

The Greek financial disaster came from refusal to live within their means and not run chronic deficits for decades on end. This is the end result of modern "borrow and spend" liberalism taken so far as to ruin the finances of Greece and exhaust the patience of the rest of Europe. The people bailing are the "children" spoken of when conservatives are heard to say we must not saddle our children with debt.

The thing that is not said is that the reason we must not do this is not merely because it is morally reprehensible, which it is, but that the children simply won't pay it. Unless you are ready to erect gulags to enslave people you can't make them live their lives to fund your unlimited socialist dreams.

Re:Sucks

[mellon]

The problem in the U.S. is not people who don't have skills. People have skills. The problem is that skills aren't valued. If you have skills, you will get paid shit. If you manipulate money, you will get paid a lot. This is why there's been such a geek brain drain into the financial industry. The U.S. does not value working for a living. We value gambling for a living.

Re:It's like Venezuela but without all the gun cri

[Anonymous Coward]

Note not just socialism, but socialism *AND* cutting taxes low. They tried to have their cake and eat it too.

Of course before the Euro, they might have been able to stumble over this while massively devaluing their currency, and it wouldn't have been as disruptively bad. EU members might just have too much sovereignty to share a currency.

Re: It's like Venezuela but without all the gun c

[jonnyj]

The Federal Reserve doesn't work like that. The USA can maintain its government deficit because enough people are willing to buy US government bonds. If, one day, people no longer trust it to repay its debts, there will be a financial meltdown the like of which the world has never yet seen.

Re:Taking on the account, while letting the banks

[PPH]

Banking in the EU is pretty much borderless for the wealthy. Just open an account in a German or whatever bank. You might need to establish 'residence'. But that's not difficult to satisfy the requirements of regulations. For the middle class on down, its another matter. If the neighborhood banks and ATMs shut down, what are you going to do? Hopping on a plane or train for a weekly cash run is no problem for the rich. Not so much for everyone else.

Any bank opening a branch (or ATM) inside Greece will expose themselves to local regulations and the economy. So there's not much chance of that happening. Not impossible, but not likely.

The problem is: Who is going to loan money to the Greeks? Too much of the population is unemployed or dependant on govenment pensions or jobs. So there's no hope of getting paid back. The few who have good paying jobs (or wealth in-country) are going to be targeted for revenue to redistribute to those living off the public coffers.

Re:Outside help

[Intrepid imaginaut]

Women wanting to be housewives aren't the problem. The problem is a socieconomic setup that makes it difficult to support a family on one income unless you're relatively well qualified or otherwise independently wealthy. Very few of the acceptable latter day social philosophies have a reproductive strategy outside of mass private or public childcare facilities, which most responsible parents quite rightly find repugnant.

Re: It's like Venezuela but without all the gun c

[Curunir_wolf]

The Federal Reserve doesn't work like that. The USA can maintain its government deficit because enough people are willing to buy US government bonds. If, one day, people no longer trust it to repay its debts, there will be a financial meltdown the like of which the world has never yet seen.

The largest purchaser of US bonds today is ... wait for it ... the Federal Reserve.

Re:Democracy

[bobbied]

They mistakenly believed that "a better deal" would come because Greece was "too big to fail" as part of the euro.

Personally, I don't think the vote bodes well for the people of Greece. It tells the creditors that the people don't/won't do what's necessary to repay the debts, and I don't think the creditors like that message because they won't get paid back. So the options are either just give Greece money and bail them out, or cut them loose from the euro. I don't think there is a political way that the other euro countries can just give Greece money, so that only leaves an implosion of the economy of Greece and a whole lot of pain and suffering for the least of the Greek people.

So they voted for this "theory" of a better deal, but they will get what they fear most. They will be ejected from the euro, violence and suffering is on the way.

And so it begins....

[Chris Mattern]

The avalanche has already started. It is too late for the pebbles to vote.

Re:Outside help

[nikosdion]

I'm tired of listening to this. Let me tell you what happens when you're 100% legal and declare everything up to the last penny you get as a software developer. In 2012 I had 100,000 Euros income paid 86,000 Euros spent on taxes (income tax with surprisingly different brackets than last year, "temporary" property tax, "temporary special contribution" 4% on the total turnover, mandatory social security, 55% of your current income tax as downpayment for next year). The year before I made 74,000 Euros and paid "only" 50,000 or thereabouts. In return I got: no schools, no roads, no pension, more taxes, more family members depending on me to live. The more you work the less you make (unless you have an ever-shrinking business). Crazy? That's the Greek tax brackets for you.

Meanwhile: I have to pay for my own hospital plan because in case I get sick I have to notify the public insurance carrier 15 days in advance of emergency surgery (no kidding!) or 3-4 months before booking an appointment with a doctor. I have to get an additional, expensive pension plan on top of the 350 Euros per month I am currently paying as mandatory social security because there will be no money when I'm 67 years old or have worked 40+ years to get the minimum pension of 700 Euros (nominal; actual payment after taxes and mandatory social security is around 480 Euros). I also need to set aside money to get the kids I'm planning on having to a private school because there are no teachers (not even substitutes) half of the time in the public schools.

If you are wondering why people tax evade you have to first ask the questions: 1. how much does the state take in taxes and 2. what does the state offer for the money it takes from its citizens? If the answers are "most of your money" and "not that much at all" respectively it doesn't take a genius to see why you get an endemic tax evasion for free.

Anyway. After three years of battling the system I gave up and moved away. My last tax filing in Greece was 2014 for my income in 2013. I am owed a 13,000 Euro tax return since August 10th, 2014. Of course it's NOT credited. And we're talking about money I have paid as a tax downpayment to the state since August 2013. They hold my money hostage for 2 years and they won't give it to me. Also, don't make the mistake of asking whether there's an interest rate for those two years. Don't be silly. There's not! Adding insult to injury I'm still a Greek tax citizen which means I get to pay taxes for the dividends I'm paid from my company abroad. Don't be ridiculous, of course they are NOT offset by the money the Greek state owes me! I have so far paid another 40+ thousand Euro taxes in these two years where the Greek state owes me the 13,000 Euro tax return.

I understand all this sounds alien to you. Why so much taxation, why no services in return, why the state isn't punctual in paying back. Beats me, brothers and sisters. I have concluded that one must be outright insane to try and do business if they're born in Greece.

Re:Outside help

[Cyberax]

If you do it by creating money out of thin air - yes, it shouldn't count as much. And that's what Germany and France were essentially doing all along.

And yes, I do have actual data to prove it: http://ec.europa.eu/eurostat/s...

If you check the numbers in details, it turns out that almost half of the German economic growth during the 2002-2008 period is solely because of this debt export to the periphery.

Re: It's like Venezuela but without all the gun cr

[demachina]

You donâ(TM)t actually know what you are talking about do you.

Most of the loans in question here were in fact loaned by German and French bankers to the Greeks prior to the 2008, Deutsche bank was one of the biggest. They could get somewhat higher returns loaning to Greece and they had some security because Greece was in the Eurozone. That security unravelled with the 2008 crash.

The ECB, EU, IMF gave massive loans to Greece in 2010, and most of it immediately went to extricate the German and French banks from their bad greek loans. If the Greeks has defaulted on the original loans then there would have been a massive banking crisis in Germany and France. The 2010 EU bailout was to save their banks more than it was to help the Greeks.

The Greeks just got more debt piled on top of too much debt and its totally destroyed their economy. Recently released IMF studies confirm the Greeks canâ(TM)t sustain their current debt load and it has to be restructed or they have to default. If they stay the current course with austerity and more and more bailout loans they are doomed.

If the Greeks had been smart they would have exited the EU and defaulted on the debt in 2009 and the people who made the bad loans, the German and French bankers, would have paid the price. Instead they got off scot free.

Iceland immediately defaulted in a similar situation, they had some short term pain but they rebounded, while the Greece has gotten nothing but worse and worse under the yoke of a corrupt European and global banking system.

For banking and loans to work there is a simple rule, if you are foolish enough to make a bad loan to someone who probably wonâ(TM)t pay it back, then you pay the price when they default. Instead the people who make the bad loans (i.e. bankers) get to keep their bonuses profits and everyone else gets to pay for their stupidity, greed and corruption.

Re: It's like Venezuela but without all the gun c

[Anonymous Coward]

That's usually what happens when you fire everyone, liquidate what's left and then proceed to have no further source of income: A large inflow of cash, followed by nothing.

Re:It's like Venezuela but without all the gun cri

[Grishnakh]

Yeah, look at how awful countries like Norway and Sweden are with all their "nanny-state policies".... they only have the highest standards of living in the world.

Re:How agitation ends

[cheesybagel]

No. He has DOLLARS stashed somewhere from when he worked for Valve in Texas.

He's too smart to stash his money in Euros.

Re:BS

[CrimsonAvenger]

Let me repeat it: THE BUDGET OF GREECE IS BALANCED.

Umm, then why do they need to borrow more money?

Or are you talking "current accounts are balanced"? Which is to say, except for paying interest on your bonds/T-bills/whatever, your budget is balanced.

Note that if you're making enough money to pay the bills, EXCEPT for the interest on your credit cards and mortgage, you're not really living with a "balanced" budget.

And if you really have a balanced budget, you really shouldn't be needing to borrow money, nor should you have a hard time paying back your existing loans....

Re: It's like Venezuela but without all the gun cr

[NatasRevol]

Most of the money wasn't lent by bankers.

Yes, it actually was. The EU/IMF/ECB then bailed those banks out, for some inexplicable reason, by taking the debt off their hands. Neither group, bankers or EU, did risk analysis. If they did, Greece never would have been lent the money in the first place.

Re:BS

[Anubis350]

If you can't service your debt in addition to paying your normal operating bills your budget isn't balanced.

Re:Outside help

[Cyberax]

Because it takes guts to refuse a bad offer and most of European politicians are spineless amoebas. Including the previous Greek PM.

Re:Outside help

[HornWumpus]

When 51% are on the tit, democracy is over and done. Stick a fork in it.

Re:Outside help

[HornWumpus]

Much smarter then you sucker!

Re: It's like Venezuela but without all the gun c

[Anonymous Coward]

The Greek people doubt pay tax.
All former governments were lying about the economy.
instead of being in surplus or at most 3% deficit, the Greek economy had been running a 14% deficit.

They have been lying from before they were ever let into the eu, they started lying because they wanted the euro so badly to lower the cost of borrowing.

Why was the cost of borrowing so high? Greek people were really bad at paying their debts.

The problem is the eu should never have let them in without a proper audit. They are only now getting what they deserve.

Re:Outside help

[drinkypoo]

You do live in a democracy right?

Athens is credited as the birthplace of democracy even though only racially privileged landowners even had a vote. Guess what.

Re:It's like Venezuela but without all the gun cri

[MatthiasF]

Norway has massive natural resource exports accounting for nearly 33% of GPD, imports half of what it exports and only 3 million people in the labor force. Sweden's GPD is also nearly 33% exports, slight trade imbalance in favor of exports and 5 million people in the labor force.

Greece has 12% GPD from exports, imports twice as much as it exports and has only 5 million in the workforce.

For perspective, the USA makes only 9% of GPD from exports (that includes the recent massive increase in gas and oil exports), imports 50% more than it exports and has 156 million people in the workforce.

Norway and Sweden's success has nothing to do with political models and entirely to do with geography. If the Aegean had oil fields, Greece would be a socialist paradise too.

Re: It's like Venezuela but without all the gun c

[jonnyj]

You're quite right that the first two bailouts primarily rescued Greece's creditors, but Greece already owed that money to someone. The losers in those transactions weren't the Greeks - the big losers European taxpayers who adopted the Greek government's debts.

But you're very mistaken if you think that the biggest buyers of government debt are the banks. Pension funds, investment funds and insurance companies have far more cash to splash.

You're also pretty ignorant if you claim that institutions perform no credit assessment of their investments. For traded bonds like government IOUs, that assessment is essentially outsourced to three credit reference agencies, Moody's, Standard and Poor's and Fitch. Those agencies are supposedly licenced and regulated but utterly failed to identify the risk with Greek debt ahead of the downturn. If you're looking for a scapegoat on the creditor side, they're a much better scapegoat than the banks.

Blaming the banks is a lazy knee-jerk reaction that's not really grounded in fact. P.S. I'm not a banker.

Re: It's like Venezuela but without all the gun cr

[Hognoxious]

I don't even think trade will stop, sure they won't be able trade Dramas for goods and services

Comedies generally sell better.

Re: It's like Venezuela but without all the gun c

[demachina]

Iâ(TM)m not blaming âoebankersâ exactly, Iâ(TM)m blaming people who loan money to people who are may or may not pay it back and when they dont get paid back they go running to their central banks or governments and demand they get made whole at the expense of everyone else. Same thing happened in the U.S. in 2009 with the TARP and assorted other bail outs.

Yea the rating agencies really sucked especially leading up to the crash in 2008, but it doesnâ(TM)t relieve lenders of ultimate responsibility for their actions. If the credit ratings are wrong its the responsibility of the lender to figure this out, no one else.

Lenders collect interest on their loans partially to cover the potential risk they wont get paid back, the higher that risk the higher the interest they collect. If they collect high interest rates on risky mortgages and then when someone defaults on them central banks and governments make them whole it creates massive moral hazard.

If the Greeks were a bad risk prior to 2008, which they probably were, the interest rates they had to pay should have been higher and they would have been dissuaded from borrowing or lenders would have been dissuaded from lending to them. Instead the EU created a perverse system where risky borrowers (all of the PIIGS) got relatively cheap money and a lot of it and were incentivized to take as much of it as they could. The EU and the lenders are 100% to blame for this situation for throwing the money at them.

The PIIGS shouldâ(TM)ve never entered an economic union with Germany in the first place, they had no chance of competing with Germany locked in to the same currency. It was a win win for Germany on all fronts.

Re: It's like Venezuela but without all the gun cr

[Zalbik]

The Greeks just got more debt piled on top of too much debt and its totally destroyed their economy.

A few additional interesting facts:

1) The original cause of the Greek debt was due to the fact that greek labor costs were significantly higher than other EU nations. When they joined the EU, this caused a large trade deficit...leading to lower GDP and higher debt.

2) Greece has always been somewhat left-leaning and rather than curtail spending during low income years, they actually increased spending by incurring more debt

3) The government (with the help of some banks) "hid" their massive deficit spending through the use of credit default swaps. This made Greece appear to be a better investment than they actually were when other banks provided loans.

4) Greece also historically has one of the highest rates of tax evasion

All of the above contributed to the present crisis, not just "bad greek loans".

Citations mostly from wikipedia, but plenty of similar info on the web.

Re:Outside help

[ConfusedVorlon]

actual interest payments are somewhere around 2.6% to 4.3% of GDP (depending on your calculation method)
http://www.ft.com/cms/s/0/6e55...

greek tax revenue as a proportion of gdp is about 30%
https://en.wikipedia.org/wiki/...

so greek interest payments are approx 10% of tax receipts
http://data.worldbank.org/indi...

Re: It's like Venezuela but without all the gun cr

[Hognoxious]

Greece reported a nearly 2 billion euro surplus in 2014, without taking interest payments into account.

I could take a cash advance on a credit card at 28%, put it in a deposit account at 1%, and generate a surplus without taking interest payments into account.

Re: It's like Venezuela but without all the gun cr

[complete loony]

That's a good description, but everyone is still missing the actual cause. Firstly, the European Union is founded on an ideology that doesn't allow for an economic crisis. Second, when the crisis hit in 2008, the Greek *private* sector *reduced* their bank borrowing. Their money supply shrank, velocity shrank too, jobs were lost, tax receipts went down. Their government debt ratio went up, not because they were borrowing more, but because GDP fell. But the Euro doesn't allow Greece to run a large deficit, nor to increase their debt level, so they can't stimulate their economy to prevent further job losses.

The Greek government weren't in good shape before, but the combination of a crisis and the rules imposed by the Union have wiped them out.

Re:It's like Venezuela but without all the gun cri

[lars_stefan_axelsson]

Norway and Sweden's success has nothing to do with political models and entirely to do with geography. If the Aegean had oil fields, Greece would be a socialist paradise too.

Not even close. Sweden doesn't have one drop of oil, we have industry. And adding to that, the social programmes of Sweden are more expansive than our Norwegian brethren, who have oil. You see the Norwegians fund almost all their oil income into the world's largest and most well managed oil fund that is set up to last "indefinitely". They're most certainly not burning it. (The money. The majority of the oil most certainly burns).

Also, the oil is a recent thing, barely thirty years old. (I am old enough to remember when Norway was "poor" and we used to go shopping for cheaper staples there), and guess what, Sweden's social programmes were even further ahead than the rest of Europe in particular, and the world in general.