The Greek Situation

Posted on February 12, 2012

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     I had the opportunity to visit Athens this summer. It was a beautiful city the food was delicious and the people were wonderful, especially my fellow debaters from Athens who showed me their city. My visit to Syntagma Square was far more pleasant than I’d imagine it would be today, there were no protests just tourists and Greeks alike enjoying the weather, and I have a feeling that it is like this most days. As I waited to take the tram for a day at the beach I couldn’t imagine the Athenians capable of vicious protests like we are seeing today. Historic buildings are being burnt, homemade bombs are exploding, the smell of tear gas has even reached the chambers of parliament. As CNN said, “The Greek have risen”.

     

The Greek people have had enough austerity, their pensions, wages, and public services are continuing to be cut. When I was in Athens their taxi drivers were required to pay for a license that would cost more than they were going to make in the entire year. The Greeks have delayed retirement, and have paid necessary taxes, but the government and European powers have continued to ask for more. Nearly four billion dollars of austerity measures will fall upon the shoulders of the Greek people. For those trying to retire and likewise those who are students trying to get on their feet, the next few years will be difficult with new IMF/EU stipulations.

     The stipulation for the new bailout bill is that Greek lawmakers cut nearly four billion Euro this month just to prove that they are worthy of another bailout. The 4 billion Euro in cuts that the IMF and EU expect Greek lawmakers to make doesn’t help anyone. The cuts cause public dissent like we saw on Sunday, especially after the last two years of austerity the Greek people have faced. The lawmakers are bound to passing this deal because they may default on the 14 billion that they owe this month without it. This short term cut is an economic purge on the Greek people, and is an irresponsible request from the European Central Bank.   

     The goal of the IMF EU and private investors is to make Greece’s economy solvent, which means they owe less in dept than their total GDP. Currently the gross domestic product of Greece is 312 billion dollars, but their debt is 583.3 billion Euro. After receiving the 130 billion Euro bailout Greece will owe 450 billion Euro. Greece will also likely agree to a deal with private investors to restructure their debt/budget which will shave an additional 100 billion dollars that Greece would owe investors, taking their debt to a maintainable and nearly solvent 350 billion Euro.

     Greece will need considerable advice and monitoring from the EU as well as the IMF, but this is the purpose of an Economic Union. Having similar currency and an greater buying power gives the countries within the EU an ability to grow, and to make more money, but bounds member countries to help others develop and bare economic crisis.

     The current protests seem legitimate to me, but the lawmakers of Greece will pass the stimulus bill for the sake of their country, to make their economy solvent again. The EU and IMF’s petty stipulations are at fault today.  

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