Greece – Not Out of the Woods Yet

The Greeks are going to vote in national elections for the 3rd time in 8 months. Not a good way to run a country. But then they haven’t been doing much for a long time. Greeks scavenge for hope but the public sector remains off the leash – Telegraph

You will hear much about how Greece is sinking under the weight of austerity. But the truth is, the Greek economy is sinking under the weight of the Greek government. No government since the economic crisis has done anything to cut much in the way of expenses. And the latest fiasco – Syzria – did their utmost to completely gut the economy. (Closing the banks for weeks, not allowing businesses to pay bills is NOT the way to run an economy.)

The country has a population of 10 million, of which 2.5 million are pensioners, one million are government employees and two million work in the private sector. A further 1.7 million are unemployed. The rest are children or students.

“So you can see why the current situation is unsustainable,” says Tryfon. “The only solution is for the public sector to be cut back. But every government since the crisis has chosen to raise taxes, while doing little to stimulate the private sector because they only want to protect votes.”

You really can’t have a situation where 20% are expected to support the other 80%. “Eventually, you run out of other people’s money.” That pretty much sums up the status of the Greek economy.