1601

iirc, it was an OECD report, but I’m not sure. I’ll try to find it. edit - IMF had it pegged at 25% in 2010, but it looks like that’s grown since then (most recent that I’m finding seems to be around 35%, although that’s before this year)

One weird economic fact that’s been bouncing around: back in 2012, the University of Chicago published a paper finding that many greek self employed professionals spend more servicing their debt (a number that’s verifiable) than they report as gross income (a number which is clearly cooked). Since people typically don’t spent more than 30% or so of gross income servicing debt, that implies that many self employed professionals – of which there are a much higher proportion in Greece than most of Europe – could be under-reporting their income (and hence underpaying their taxes) by 66% or more.

Yeah, I also saw an older report that indicated that self-employed Greeks had a far higher percentage of tax evasion (estimated to be about twice as frequent as non-self-employed … forgive me, English teachers).

1602

Aren’t you aware that Germany was torn apart and rebuilt to the Allies’ likings at that time? The whole structure was changed. Compared to the stuff Germany had to do the Greek discussion is talking about peanuts. And yes, the Allies were right to enforce the whole thing. It helped us a lot.

Also, the vast majority of the German “loan” was not paid back to the US. It was lent by the US to German companies, but paid back to a German fund that used the repayments to make loans to more German companies.
This still exists and does important work.

[quote]I think even Syriza would be delighted to get a deal on such generous terms.

Greece got a much better deal. They got a 100bn€ debt cut for free. They already got 380+bn€, did very little for it … and are in a worse situation than ever.
And if they want to have something similar to the Marshall plan or this small business fund it the German branch grew into, maybe they should ask about it. It comes with an external administrator though. ;)

More money for Greece is not the solution. They need to clean up their stuff first. Only then they’ll have good arguments for a debt cut. I bet they could get away with ignoring large parts of the new agreement if they do their own thing in that spirit, as long as things keep moving in a positive direction. But they have to do something.

1603

To put that into perspective you have to understand that Greece, at least effectively, doesn’t have a working tax fraud investigation. The risk to get caught is close to zero.
This would indeed be an easy way for Greece to collect many billions of EUR per year, but for some reason they aren’t willing to do it. They even have CDs full of Swiss bank account data collecting dust.

1604

Re: speeding. This could be a thread derail, but going 20km/h over a 100km/h limit on high quality freeways in clear conditions is not a major safety hazard. Therefore, the police don’t enforce it (in Ontario, Canada at least). Alternatively, going 10km/h over the limit in a school zone is a safety hazard, so the police do enforce it. I think it’s reasonable. Overall public opinion, elected representatives, and enforcement are generally on the same page and that page is generally aligned to the greater good.

In regards to “the system and the people are the same”. Ok, perhaps some better wording: In Greece, just like the US and other western democracies, the system is exactly as bad as the public tolerates and even wants.

In Greece it is a general attitude problem among the public and the government. The attitude is “how can I screw the system”. That attitude doesn’t exist to the same extent in Canada or the US or say Germany or Sweden. And the problems in Greece are deeper than unreported income. We’ve read so many sad-but-hilarious stories: 498 people in one community found claiming they were blind to collect disability payments. 8,500 pensioners faked being over 100 years old. A street of opulent mansions cross-checked and found average reported incomes of 12,000 euro a year. Civil servant not fired despite murder conviction.

You point out that only 1% of people in your state claimed online purchases from Amazon.com, fine. But somehow today it’s built into the website, and now you are doing so willingly. So what you’ve done is shown me a system that works (despite its total dyfunction :)). That just doesn’t happen in Greece.

Now for the unpopular part of my opinion: It’s possible that Greece and maybe other Eastern European countries are simply not structurally or culturally suitable or ready for the EU (or a western world built on the principles of fairness). I have a colleague from Bulgaria. He misses his Country but the corruption was intolerable. He described how every. single. business. transaction. required. bribes. Every. Day. Yeah we have problems in Canada too, but I don’t have the fire inspector knocking on my door once a month and saying my house doesn’t meet code and I need to pay a $10,000 dollar fine (or just slip him a $50, no harm done). That was his example. Bulgaria is now part of the EU. He, the person who just wants to live in a fair country, left.

Another anecdote for what its worth. I know there are good Greek people, two work in my company. I’d say that those two I know in particular, I would bet a dollar that they claim their income and do their taxes right, heck I doubt they torrent any TV shows even. But note that they left Greece… they’re highly educated and want to live in a fair system, and they didn’t like the system there, so they don’t live there. Who’s left behind, expecially given the crappy economy?

1605

Those are two different issues. The more common self-employee in Greece is a laborer (in Spain we also have high tax evasion in self-employed individuals. It’s really hard to control at those levels, since the earnings are not that much and the amount of self-employed workers high, so the chance of an inspection is small -we do get inspections-). The Swiss bank accounts are not filled with that kind of income (and Syriza actually addressed this latest issue -or started to before everything blew up to hell-).

The problem is that it’s really hard to inspect all those self-employed people without very significantly increasing the tax collecting workforce. It takes a lot of time to do an inspection, and the payout is small (the self-employed with bigger incomes have a harder time evading -at least here- since those do get inspections).

1606

My last paragraph reads poor when I say that ‘I know there are some good Greek people’. My perspective is not that the general public are crooks or bad people, but the attitude towards the tax, income, and social/political system, which is ingrained in the culture, is not one conducive to a government that can pay its bills.

1607

When you have sub 30 hour work weeks that’s what happens, you don’t generate enough revenue to pay the bills.

1608

Wrong, they need more money now, they have no money, I mean nothing left at all.

1609

But there’s a good chance that if you give them more money, they’re just going to spend it and then have no money left again in the near future.

I mean, simply because they have no money now does not mean that giving them more money is automatically the solution.

1610

What alternative do you propose?

1611

Eh, did you read that Greeks work many more hours per week than the European average?

The longest hours in Europe by a stretch.

And certainly way more than Germany. 2228 average hours per worker annually in Greece versus 1371 in Germany (which has the lowest annual hours of the tracked countries)… Using OECD data. (US is 1789)

Think again…and keep your prejudices in check…

Edit: hourly wage is extremely low…

1612

Incorrect. They get bridge financing through the EFSM. The UK refused to participate.

Giving them more money doesn’t cure the problems. Why would they solve anything if the EUR countries keep paying?

1613

Almost correct. Giving them more bailouts on payday loan terms isn’t going to help anything. Re-structuring the debt and payment terms into something that can reasonably be handled by Greece would help quite a bit.

1614

It may be too early to render a verdict after just 10 or so posts, but I think that Realmk is just on a mission to rile up this forum’s slightly left-of-center population. He’s a climate change denier, he asserts that Hillary does nothing but vomit up lies, and of course he has nothing but scorn for those lazy, shiftless Europeans and their short work weeks.

There’s plenty of people that hold those views, but it’s rare to find someone who so forcefully believes ALL of them, just like you’ll have a tough time finding a Progressive that espouses every single Left-Wing talking point. And of course, it would take a special type of ideologue to want to come into a new forum and speak to ALL those issues in the course of just three and a half hours. He’s like the Ur-Conservative; the father of all Right-Wingers; their Lord and He Who from All Libertarians Spring; the anti-Zak whose coming was foretold.

1615

That’s because nearly all of that money will be spent paying back the original loan itself.

Imagine the balance on your home mortgage was suddenly due at the end of the year. You can’t pay, so you have to refinance. And all refinance loans are due in one year. Is it any surprise that you will have to come back every year in the near future for yet another loan?

1616

Yes, this would take pressure off. The problems with that are (drastically summarized):
a) Measures off debt reduction were already tried, worth ca. 100bn€. It did not help.
b) Greece is simply not trustworthy any more. They are preceived as notoric liars. What guarantees are there that the cycle doesn’t continue?
c) Doing such a step without 100% certain reforms gives away a huge part of the leverage.
d) Each government is bound by law to do the best for its own country. This includes not wasting their tax payers’ money.
e) Such a measure would require agreement by a couple of local parliaments.
f) Other troubled countries did suffer through reforms. It’s unfair to them to let Greece “get away with it”.

Schäuble said yesterday that he considers such measures incompatible with Greek being part of the EUR. Which basically means he would agree to some debt relief if Greece goes back to the drachma.

1617

I have fairly strong libertarian views, but the science behind climate change is crystal clear and I think Hillary is no more or less willing to say what her audience wants to hear than the average politician. Calling Realmk the source of libertarians is an insult! ;-)

1618

The solution to the problem you described is called “filing for insolvency”.

1619

Of course. Weren’t you the one who wrote Greek has many self-employed people? Whoever can afford it is self-employed because it’s easier to avoid paying taxes that way.

1620

This only makes sense if the reforms actually improve a country. If they don’t then it’s nonsense, akin to “We can’t send emergency aid to the East Coast after Hurricane Sandy, because New Orleans had to suffer through Katrina without much help at all.”