February 24th, 2010
07:21 AM GMT
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A day after covering the British Airways strike ballot, I have landed in Greece to find out why many Greeks are calling for a national day of strikes and thousands will march on Parliament in Athens.

While that satisfies the stereotype of angry middle class workers in Europe who don't like the governments cutting pensions and raising taxes to battle budget deficits, I am also hearing many Greeks actually support the measures to bring down the budget deficit.

They know that the pain will be felt around Europe this Spring and Greece will be watched closely by the markets and by Brussels.

Wednesday will tell us a lot about how tough it will be for the government here to push tough fiscal measures.

This is something governments around Europe may face soon. Are they on the right course?

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Filed under: BusinessGreece


soundoff (31 Responses)
  1. Anna

    I think Greeks should go live and work in another "normal" country for just a month. Then when they come back to their own country they would realize that they have a pretty sweet deal going on at home. Spoilt, unwilling to change and with a sense of entitlement; character traits of the typical Greek these days. While they expect nothing to change, they do expect everybody else to help them continue their daily life over overspending, under working and overindulging in coffee breaks. Athens is looking more and more like a giant sandbox where the toys are flying in the biggest temper tantrum ever.

    February 24, 2010 at 8:40 am |
  2. Nelly

    Many Greeks do support the measures to bring down the budget deficit. It is high time that Greece puts its house in order. But the Greeks are disillusioned by most of the politicians in this country. There have been so many scandals and so much wrongdoing by both of the political parties that have held power in the last dozen years (Pasok and New Democracy). I believe that the Greeks want to see those that are guilty put in jail, and the money that they "acquired" returned. That is when the Greeks will be more willing to make the sacrifices that must be made.

    February 24, 2010 at 8:54 am |
  3. bad_hawk

    Forget it. Puting money in Greece is throwing pearls to the pigs. There is no control of expenditure. The state doesn't know how many employees it has. No one pays tax.
    What you need is :
    A) To digitalize all personal data,
    B) Include credit card expenditures and bank balance / liquidity in one's personal tax declaration,
    C) End the tax break for shipping companies, forcing them to declare how andto whom dividends are paid,
    D) Tax realstate,
    C) Tax people on life standards,
    E) Corss all information electronicaly in order to have a comparison with one's expenditure and one's tax declaration,
    F) Control in and out flow of money, and focus on origin and final destination.

    Over the last one month, it is estimated that the Shipowners, politicians and big fortunes of Greece (there are a lot more than you could imagine) have 'exported' several billions of USD in currency to tax havens.

    What Greece needs is a 'guardianship' from EU quickly otherwise we might see a social unrested which might require the army to intervene to garantee the order and avoid destruction.

    February 24, 2010 at 9:17 am |
  4. Lawrence

    It's good that CNN is covering this subject, but unfortunately the video clip completely skims the surface and glosses over many fundamentally important issues in regards to Greece's economic situation. The correspondent asked his interlocutor whether many Greeks (middle class and below) would be willing in effect "to share the pain" if they thought the burden were being distributed more evenly across income levels. The point is, however, that for many hundreds of thousands – if not millions – of poorer Greeks, "sharing the pain" is tantamount to suicide. One cannot expect a poor pensioner who lives on 400 euros per month (and many times also still has to help support grown children because of the country's high unemployment/underemployment rate) to "share the pain". They are ALREADY in a world of pain. Meanwhile, there are very many extremely wealthy people in the country who get away without paying taxes or gaming the system to pay very little – everyone in a position of power knows it, and everyone treats it with a "nudge, nudge, wink, wink", because they are ALL doing it. The structural problems of the Greek economy are well-known and many, and there is no point in rehashing them here. There are solutions to many of these structural problems, but they are long term and unfortunately the country's politicians have never had the guts to implement them. One of them is a serious income tax regime (including real enforcement). But perhaps the biggest "structural" issue the country faces right now is a little thing called "the Euro". Greece is a poor country living with a rich currency. As I once heard it put, we are living with German prices and Albanian salaries. And while the EU commissioners may try to implement a number of so-called austerity measures (like jacking up VAT rates – which are already the highest in Europe by far – or imposing new taxes – which will punish those already suffering, while the people who always get away without paying their fair share will continue to do so), guaranteed they will not see beyond their own noses to deal with this most glaring of all the country's economic woes: a highly overvalued currency that is a huge millstone tied around its neck. As an American living in Greece and seeing first-hand what goes on here, I can unequivocally say that there are no easy answers to this situation – not only for Greece, but for all of Europe, because the Greek situation will impact the rest of the Eurozone. So when, Mr. Boulden, you ask whether the average Greek is prepared to "share the pain", I think the better question is this: is the average European prepared to "share the pain"? Because like it or not, one way or the other, it's coming, baby.

    February 24, 2010 at 11:15 am |
  5. Christos Lefakis

    The economic misfortune of Greece is primarily the country's internal social and political failure but it is also a part of a greater EU problem. It might be the first indication of a need for EU deepening and tighter policy.
    As a Greek I am frustrated with the country's inability to eliminate corruption, huge government spending and false economic stats. As a European, I am hopefull to see Brusells intervene and succeed where the national government has failed.
    Greece is a EU border nation which is spending a significant amount of its GDP on military spendings mainly due to its relation with Turkey. In a Federalized EU that would guarantee the sovereignity of the EU border, such a spending would be unecessary. This example is not to reduce the Greek responsibility for the current situation, it just goes to show that there are many more parameters determining the success of the monetary union that need to be adressed now and not later.

    February 24, 2010 at 5:04 pm |
  6. Europian

    The Greeks are known to be the lazyest people on earth.
    before thausands of years they were living in goods stolen from other countries during wars,in modern times they lived in the money of western countries by visiting greece,but now they have difficulties and there are not many visitors there greeks are having problems.
    Greece does not produce anything,they cant feed themself without outside help and they are the most cockiest peole on earth.
    They have to learn and respect the rest of the world before the world would go to their rescue.

    February 25, 2010 at 8:22 pm |
  7. Gary Pulsifer

    Christos Lefakis:

    You make good points, but it's difficult to justify Greece's military spend, which is very high and which to some friends of Greece, like myself, seems based more on paranoia than reality. And as a nation Greece certainly can't afford it, any more than America can its military spend.

    February 25, 2010 at 9:56 pm |
  8. Lubor

    Its difficult to safe a country, which has not any income and the only business running is olive oil production and tourism. As someone mentioned here, the shipping companies are totally free of tax ( just against showing reciepts that company spent some 50,000 usd per year). You cannot run the country, where hundred of billion sof USD were moved from shipping companies offshore and still same continuing. On the other hand, there are some estimated 300,000 people employed in shipping and may the tax be applied for shipping companies – they will probably leave everything behind (except the cash) together with those employees. I know many people in Greece – doctors, professionals, vendors – no one pay taxes. I wonder if there is any greek word which can translate the word " taxes". the only people paying proper taxes are government workers, which are triple the necessary capacity . What I understood many of goverment workers still works part time job, which again no taxes paid.. Would EU seriously consider to support this country? In such case the whole EU will be drawn into a deficit ever deeper then now in couple of years. Give them freedom and let them find the decision by themselves.

    February 26, 2010 at 8:19 am |
  9. Christos Lefakis

    Gary Pulsifer:
    I am not an expert on international affairs but I believe there is a Greece-Turkey 7/10 military spending dogma. For every 10 Turkey spends Greece spends 7. I think that this is detrimental for both countries economies but quite profitable for big war industry. Anyway this is just an example (probably not the most successful one) to show how political decisions can influence economic policy.
    I think my main point is that the EU might need to move on to a tighter political union like US federalism or it might face rupture.
    In the case of Greece, and believe me I know it first hand, there are many people that wish that the EU stepped in and imposed reform that we are not able to bring to ourselves because of the socio-political decay we are experiencing.

    February 27, 2010 at 12:35 pm |
  10. Fot

    I am Greek, having been educated for my MBA and PhD in the UK where I also taught at a top Business School for a number of years. I will not particularly disagree with you that Greeks, like going out for coffee, something that it is difficult to do in Germany and the UK.

    However....guys, relax!!!! One could easily argue that British (and I assume Germans) hold a bottle of beer in their hand, almost all day. Between 12:00-14:00 none is working in the UK (which is not the case in Greece since there is no "lunch break").

    People are going on strike, because they don't know how they could go on living with pensions of 300 euros and basic salary of 700 euros! These are monthly pensions/salaries and not weekly as you may think!! And over the last years living expenses in Greek have reached the levels of most European countries.

    So, I agree, the Govermnet should find a way to cut spending. But, it should also at least double the salaries!!!!

    Work with ratios (e.g. salary to living expenses), not raw figures!!!! Fundamentals of financial analysis!!!!

    March 1, 2010 at 9:10 pm |
  11. Maudie Myer

    I have been living in Greece for many years almost 25 years. And it is very true that there is a general feeling of doom here – people young and old have lost their joy and are hopeless. It is a sad situation. It is true what Fot says the basic salries and pensions are so low and the cost of living is as high as the rest of Europe. Different ones talk about the overinflated civil or government circles but I think few are aware of the fact that Greece is a theocracy in a way there is no separation between state and church. This means that 100's of 1,000's of priests and deacons have their salaries and their pensions paid by the state not by the church of greece. Probably looking at over 30.000 of them. The are viewed as "civil servants." If church and state seperated think what a saving that would be for the government? The church is extremly wealthy and untaxed. They own at least 1/3 of the real estate in Greece....so maybe the greeks will wake up to the fact soon and do something about that.....then the financial problems will be solvedwith no bailout...

    March 2, 2010 at 12:23 pm |
  12. trojan horse

    fact is, "fot", both, english and german people could be boozing all day every day for a long time, they still wouldn´t pile up SUCH an amount of debts as the greeks, who lied their way into the EU. so, if you say everyone is so poor in greece (cry me a river, land of the tax-free), where have all the millions of euros gone you receive from the EU, money you got from countries like lazy uk and germany? the greek state is rotten to the core i say, and every effort to salvage it will be painful. however, i'm under the impression that every time anyone tried to change things in greece, people immediately went on the rampage against it. sadly this seems to be the only kind of energy the greeks will ever be willing to bring up for something.
    cheers!

    March 2, 2010 at 9:04 pm |
  13. Fred Mertz

    Greece needs to get rid of most of its civil servants, and put the rest to work.
    Otherwise, there is no salvation for this socialist theocracy....

    March 4, 2010 at 9:33 pm |
  14. lechat

    it's fascinating me : while everybody knows that rich people are reacher than ever, the idea they should be never occurs.
    When are we to react ?

    March 5, 2010 at 4:53 pm |
  15. george m

    I been hearing about germany saying to sell greek island s,the acroplolis , and they owne 80 billion euros for war crime and they are defaulting a court order, they owne ote the phone and internet site and it takes me over 40 minutes to log on , and i am not the only one, i been complaning about greek politicians for years from meeting creetens staying at mamas house to serve the greek milatary and service was to cleam misitakis the political hero s home and catch for him and he's family fresh fish every day back to germany with there pay off of more bad greek politicians to win the olympic contracts, there i go again back to where i started there the bigest low lifes in europian history cant tak bad about the asian country thats an ally but wants to endager U.S. troops to get $ for fly overs becouse there a cc-tuck there contract

    March 5, 2010 at 9:28 pm |
  16. outsider

    Greece and the EU: A sign from above or an accident bound to happen?

    In the interview the problems in structure were raised (Greece) and that changing the figures will not help. So far is Greece. What about the EU? Same.

    Passing bonds from one partner to another will not help and it is a structural problem indeed. Who authorized the deficit and printed the bills (EUROs)? The European Central Bank. At the point of entering the EU, was the shipping business taxed? No. So why bringing it up now? But it is good to find out now who got the big sums out of the 300bn EUROs....In 1980, what was the deficit (in Drachmas)?????

    There is another problem coming out. All talk about Germany as the "bailer". Wrong. Even if the legal definition of the EU is of a partnership, the EU cannot escape the written promises enrolled in the treaties starting from Rome on to Maastricht, among them the promise of a political union. More Economical than Economical (Union).

    Sawing up all those treaties you will find that it forms "special relationship" between the EU and each member state, separately. The EU is promised to be more than a "money printer" (in writing). With its political agenda, 3% out of the GDP? Couldn't the EU say no?

    I think its good time to shake the system (EU) and its structures. Why not start in the European Court? Negligence is not far away. Any individual who pays taxes in Europe can bring a suit against the Central Bank.

    March 6, 2010 at 9:35 am |
  17. Marija

    Maybe if the Greeks weren't so busy leading a hostile foreign policy towards their neighbors they would have been able to prevent things getting as bad as they did. The Greeks have been standing on the way of the Republic of Macedonia becoming a NATO and EU member for years now and it is just ridiculous what they are allowed to get away with in the EU. They have been acting as the EU baby and throwing tantrums for way too long and what gets to me is that they are so tolerated by other members. Kudos to Germany for saying "no more".
    They go to that extend to make Macedonian sport teams take off their uniforms or leave competitions (which has happened numerous times).

    What about their treatment of illegal aliens – when they don't want to deal with them, they drop them off in Turkish waters and if the Turkish coastal guard finds them and rescues them they will live, otherwise they will be washed off on Turkish shores in few days = problem solved!

    It is time for Greece to grow up and face its problems and stop creating ones for everyone else.

    March 6, 2010 at 10:15 am |
  18. Billy Rubin

    Likewise to soccer, Greece need a coach on the financial field. Probably another Gergam could do the job :-)

    March 6, 2010 at 7:25 pm |
  19. European in New York

    I believe that the solution about the rotten state of ecomony of Greece, is simply for the Greek people to go back to work. They need to earn a living like everybody else in this world and work hard until they pay their debts off. The time has come that Greece to not live anymore by lying, cooking their books and making it seem they are "smarter" then the hardworking Germans, or Americans for that matter. The byzantine system that exists in Greece, is not only in the financial field. Greece need to become a European country by first and foremost changing their rotten mentality. That can start by recognizing Human Rights of their many minorities, by separating church from state and most importantly by stoping acting like everybody ows them anything- because that will definetely not help them to save their bankrupt country.

    March 9, 2010 at 4:40 pm |
  20. Anthony O'Neal

    I was there during the transition from the Drachma to the Euro and I knew then that things would never be the same. The affluent people are the problem,mostly the british retire on islands like corfu. They don't pay taxes because their retirement income is already taxed in the UK,not to mention they don't pay any kind of property tax annually. The brits and the germans are the one's who have ruined that country. I say this because when lived there with my father for several years, the only disgusting things I encountered were Germans and Brits.I guess the greeks were stupid enough to continue to have children when the economy could not bare it anymore. That being said, there is nowhere else in the world that is so beautiful and relaxing. It's truly a shame that foreigners have ruined the country, make no mistake the greeks don't like anything but other Greeks. One thing I forgot to mention in regards to military spending, every Greek at the age of eighteen has to enroll in the military for one year or you will not be considered a true Greek man.

    March 9, 2010 at 4:46 pm |
  21. snapucha

    I am a Greek who lives in US and have traveled a lot throughout Europe. Because of my profession (scientist) I meet and work with people from all over the world. Some of the comments here about the "character" of Greek people are very unfair, a complete fabrication and simply show the "racists" mentality of some uneducated people.
    The problem with Greece is political and has roots in the events that followed WWII. Before you judge the Greek character learn more about its recent history and how Greece was forced to become a protectorat of NATO with a help of a bloody "civil" war that was orchestrated by the Brits and US and resulted in more deaths than the German occupation. How after the end of the civil war the Brits and US imposed one "pseudo-democratic" goverment after another, and intentionally encouraged the creation of a corrupted political system which naturally has great self-sustaining power and therefore creates enormous problems for the Greek society and now EU, even to this date.
    I agree with Papandreou that this situation can be viewed as an opportunity for Greeks to change this. The problem is that after so many years of corruption and greed inside Greece and in Europe and in USA, Greeks are now confused and don't trust anyone, therefore they are not sure that the sacrificies they are asked to do are nessecarily for their own good. Some see it as another opportunity for the World capital to reduce the quality of life of the working people. Can you blame them for this? I see how people live in US for example. It is a miserable life for the great majority of people. Highly paid proffesionals barely make enough money to support their family, and in the majority of the cases two highly paid professionals are required to make a relatively comfortable living. School teachers, police officers, etc live a life that most in Greece will characterize as miserable. Simple workers at Wall Mart, etc are just screwed. Their life is equivalent to slavery.
    If this is the order that we have to put in Greece to keep in pace with the rest of Europe? If this is the case, I say no thank you! Let Greeks be the rebels and lazy-people you imagine they are but maintain a life-style that has resulted so far in families that are more bonded than in the rest of Europe and life expectancy that is one of the highest in the world.

    But I do agree Greece needs change, only a change that will be decided by Greeks and will serve the Greeks first.

    The rest of you, please spend some energy into saving your own societies, cause I haven't seen any country that is not really in deep sh** in one way or another (except maybe for the semi-socialistic Denmark :) )

    March 9, 2010 at 10:05 pm |
  22. Frokostordning

    Hm hm.. that's quiet interessting but to be honest i have a hard time seeing it... wonder how others think about this..

    March 9, 2010 at 11:01 pm |
  23. snapucha

    Fred Mertz,

    Greece is neither a theocracy nor a socialist state. Unfortunately, it is a free-market, two-party "democracy" like many other countries in the western world. And this is one of the reasons why it is in such a trouble.

    But you are right, socialism is bad. It is socialistic states, like Denmark, that have shown how "bad" socialism can be. Especially when neoliberals from Texas almost destroyed the world with their free-market oriented polices.

    March 9, 2010 at 11:07 pm |
  24. YOS

    the truth is that greeks are lazy and the only reason why they have any money at all is because they are white christians!!! Their economy is based on other white christian tourists

    March 13, 2010 at 10:28 am |
  25. Costa

    Wow. I am a Greek – American. I have lived in Greece, and I have many relatives that currently live there.
    First offl shame on you "Europian" for using this forum to spew forth your ignorant, inaccurate, hate-filled, hateful, borderline-racist, poison.

    Government corruption is probably the root of and the biggest obstacle in fixing this mess in Greece. It also doesn't help that have the country is employed by the government.

    I know for a fact wages in Greece are low especially when compared to the cost of living.

    I also know for a fact that people get away with not paying taxes in Greece, especially people wealthy enough to hire accountants and lawyers who know how to hide money.

    But corruption, and tax evasion, or brokern government is not a uniquely Greek problem.

    I think debate and disagreement and analysis are great. I think many who have written here have valid points and good ideas. I just get irritated with the attacks on the people and the country. I find it at the very best...classless

    March 15, 2010 at 12:14 am |
  26. Effie

    Wow! according to "Europian" Greeks are the laziest people on earth! and that they stole from other countries .Shame,hey maybe a litte bit of history studies will help Europian get true facts.
    Democracy began in Greece,and much much more.There is no need for a history class now.Just like Skopje trying to steal and claim history that belongs to Greece.Maybe a visit to Vergina would be an eye opener to folks who get carried away by false info.
    Europian,don't be predjudace and racists.Do you know the Greek word, "filotimo", ever visited Greece? maybe that would help.
    Each and everyone should first check out their own "house" and then critisize their neighbor!

    March 16, 2010 at 8:11 am |
  27. Effie

    Greece is being accused regarding the illegal aliens.If the Northern European countries are more sensitive with human rights issues why don't they accept the thousands storming in to Greece. Regarding Marja's comment,why isn't the neighboring country being accused of "stealing" the money and sending the illegal aliens to Greece.If they are so sensitive why don't they take care of them.

    Marja,maybe it's time to get the true facts.it's the other way around.One last comment,Macedonia is and always will be GREEK.

    March 16, 2010 at 8:37 am |
  28. bomzasxxl

    let the greeks be on strike for ever, let their companies close & relocated to... lithuania. 2009 we cut salaries 10%, 700EUR basic pay and 300 EUR basic pension – we gladly would take it.

    March 17, 2010 at 8:05 pm |
  29. John Nikas

    Greece is a country which has great potential for a strong economy which could help the EU as long as the government sets the country on the right track. I mean, the tourism, agricultural and shipping industry is of the greatest in the world.

    March 22, 2010 at 6:55 pm |
  30. Maria

    This is for bomzasxxl..............I guess that some folks can't take it that Greece is blessed with beauty,tons of sunshine,history filotimo,thousands of english words are Greek , and i could go on forever! I wish for you that you are blessed and make a Greek friend and then make all the negative comments.
    Shame though how people in 2010 are so hatefull and narrow minded.
    Come down ,south to the Med folks.All Greeks aren't lazy,i am sure that all round the world there are lazy people.

    April 6, 2010 at 9:15 am |
  31. Victoria smith

    Greece is experiencing difficult times like other nations in the world. Eu has to bail them out otherwise it will disastrous for whole Europe. Spain and Portugal are also facing financial problems.
    http://www.american-schools.net

    May 29, 2010 at 12:17 am |

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