Greece votes OXI/No on more Austerity measures

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Nikodemos said:
"Debts are immoral". This isn't a good foundation for basing economics discourse on.
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And yet they were pretty happy to accept a debt writeoff back in 1953. Double standards and all that.

What's ironic is that Greece was really poor in 1953... when I say poor, I mean that most people couldn't even afford to buy a pair of shoes.

And now you're telling me that the prosperous Germany of 2015 can't do the same for Greece... fucking bullshit.

Greece's electorate isn't going to take it up in the ass just so the German electorate can remain happy. 5 years of austerity has been enough. Enough is enough, as Matteo Renzi put it out.
 
Reuenthal said:
What the fuck? How can you be completely unaware of the racist propaganda full of lies against Greece and Greeks?

A few examples:

Lazy Greeks trope.
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That's nonsense. That propaganda is based on the lack of actual achievements of the greek governments in the last 10 years.
It has got nothing to do with the nation as a whole or the people who inhabite it.
 
oti xero said:
Forget all the prejudices you have towards Greece, Germany, North or South.

In the end of the day what matters are economic facts and here's the truth: Austerity does not work.
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It has worked in the past, for e.g. Canada and Sweden. But in all cases where it worked, the countries pursuing it had control over their own currency, so that easy money policies could offset the drag on demand caused by austerity.

The combination of austerity and a currency peg or currency union has never worked in the history of ever, though.
 
ElTorro said:
First of all, you need to look up the definition of "racist". Second of all, I am unaware of any propaganda by the German government accusing the Greek people of being lazy. Are you seriously conflating troll posters on the Internet or in tabloid comment sections with Germany? If you are so concerned about rhetoric in government propaganda you might just start with Greece's former finance minister accusing the Eurozone of terrorism.
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First of all, you need to look up the definition of racism if you think it doesn't apply to the scapegoating and hatred against Greeks that has developed.
Secondly, thank you very much for your assumption but I read the statements of officials of the German goverment and watched them, as well as know that more newspapers than Bild produce garbage. The "reforms are good its the greeks fault for not enforcing them" has been repeated constantly by them. The lazy Greeks idea is a semi popular in northern europe and a dog whistile of many other comments. Many are concerned more for punishing Greeks for the idea of being defiant than fucking over the country. Or the suffering of its people. Evil certainly is a word applicable to describe these kind of misers. And many other adjectives.

As for Varoufakis, he called them fearmongers and not terrorists, IIRC.
 
oti xero said:
Forget all the prejudices you have towards Greece, Germany, North or South.

In the end of the day what matters are economic facts and here's the truth: Austerity does not work.
Click to expand...

Yeah, this whole discussion about evil Germans and lazy rich Greeks that retire at 40 is dumb and it's tabloid material.

The current situation is following a 4-5 years of harsh austerity under IMF and Germany supervision which made things only whose by being setting in basic economic forecasts (GDP) and in estimating basic impact of the measures.

Greece of 2010 was the product of corrupt and incompetent Greek governments and living above possibilities. Greece of 2015 is the result of Troika incompetence and/or covering of political friends of PPE. Plus saving German and other EU economies from their stupid banks investment decisions.

Supporting now another plan like the previous one has no logic. You can't expect to do the same thing under the same conditions and obtain a different result.
 
Theonik said:
Like with OTE and all other sales, the only people buying are looking for a firesale, and the Troika doesn't allow them to say no if the terms aren't mutually beneficial. Basically opening the door for pro corporate profiteering on the guise of competition.
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Yeah, that's pretty disgusting. One more reason why Grexit (as hard as it may be in the short term) might be the best solution for Greece overall.

Allowing the Greek government to be stripped of everything (including what is nailed down) sounds like a crime against the future of Greece, which is already hard enough as it stands.

Loans, bailouts and bonds are not secured against hard assets, and they should not turn into that.
 
TCRS said:
Germany has been an export nation for 5 decades now, it didn't start 10 years ago. The Mittelstand owed Spain fuck all. Germany was doing just fine before the Euro. Lets not forget that joining the Euro was a demand by France for allowing the reunification of Germany. Germany became naturally the hegemon due to its size and location, nobody asked for it. It's one of the reasons it always hid behind France, but leadership from France has been sorely missing the past few years. So now Germany has become to boogeyman.

Of course Germany has been benefiting from the Euro but it was also doing just fine before that with a strong Deutsche Mark.
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German balance of trade here:

http://www.tradingeconomics.com/germany/balance-of-trade

Spot the Euro (by setting the dates to run from i.e. 1960-2015). The other bump is the ERM.

If you want a comparison, the United Kingdom's balance of trade is almost identical to Germany's up until the ERM and then the Euro. The Euro saved German industry.
 
oti xero said:
Forget all the prejudices you have towards Greece, Germany, North or South.

In the end of the day what matters are economic facts and here's the truth: Austerity does not work.
Click to expand...
Except it does, it just needs to be implemented correctly. Basically, austerity and throwing more money at a problem are equally likely to work or fail in a given situation, it's just that the latter delays the inevitable a bit and makes you crash even harder. What Greece needs is structural reforms first and foremost. Until those are properly implemented and work, austerity is the way to go.
 
KingSnake said:
Yeah, this whole discussion about evil Germans and lazy rich Greeks that retire at 40 is dumb and it's tabloid material.
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Sadly it's not. (because a lot of news report like that and because a lot of people actually believe it)
There are basically two stories out there and both are stupid and ridiculous.
One is basically "One day Germany woke up and decided to destroy a country. They couldn't just go to war, so they had to find another way. Darth Merkel threw a dart, it landed on Greece, a proud country with noble and hard working people, and she decided "Let's destroy this country muahahahaa"

or

"Everybody in the EU was working hard, they worked as a team and did their best to make the world a better place. Except for one country. In Greece people just used the hard earned money from the rest of the EU to retire at 25. When the country inevitably hit a debt crisis because of the lazy people there the rest of the EU united and said "Oh no, we want to help you poor people, but we need just a little bit of concession. Alright?" but the lazy greeks were far too lazy and just screamed "NO! Give us all your money!"

It's getting really ridiculous.
 
wsippel said:
Except it does, it just needs to be implemented correctly. Basically, austerity and throwing more money at a problem are equally likely to work or fail in a given situation, it's just that the latter delays the inevitable a bit and makes you crash even harder. What Greece needs is structural reforms first and foremost. Until those are properly implemented and work, austerity is the way to go.
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What exactly is the mechanism in which more austerity will help Greece at this point. Explain how it will help.
 
ClosingADoor said:
It would have gone up anyway. It got a bump, but the trend was always upwards, slowed down by the reunification with East Germany.
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No. The other bump is the ERM. Mature economies with free-floating currencies do not see sustained balance of trade increases. This is as close as you can get to an economic fact.

EDIT: And this is precisely the problem right here. Most Germans probably have literally no idea how hugely beneficial for Germany the Euro has been. The fact I even need to explain this is telling in and of itself. Obviously other countries benefited too - any country with expected productivity gains higher than the European average did, for example the Netherlands has also benefited a large amount. But it's simply false to say that German industry would be anything like it is today without the ERM and then Euro.
 
It includes getting Greece’s primary budget surplus up to a chunky 3.5% in 2018, rigorous labour market and pension reforms, a more solid privatisation programme with “improved governance” (does that mean external ‘assistance’?)
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These are not the terms you would be offering if you want someone to accept.

Europe is fucked.
 
tapantaola said:
And yet they were pretty happy to accept a debt writeoff back in 1953. Double standards and all that.
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The situation in 1953 wasn't even remotely comparable.
Germany didn't receive a debt relief out of altruism or solidarity but because it was a win-win situation for the creditors as Germany was expected to be able to pay back the remaining debt much faster. Greece doesn't have the same economic growth prospectives Germany had back in 1953.
 
Fantastapotamus said:
Sadly it's not. (because a lot of news report like that and because a lot of people actually believe it)
There are basically two stories out there and both are stupid and ridiculous.
One is basically "One day Germany woke up and decided to destroy a country. They couldn't just go to war, so they had to find another way. Darth Merkel threw a dart, it landed on Greece, a proud country with noble and hard working people, and she decided "Let's destroy this country muahahahaa"

or

"Everybody in the EU was working hard, they worked as a team and did their best to make the world a better place. Except for one country. In Greece people just used the hard earned money from the rest of the EU to retire at 25. When the country inevitably hit a debt crisis because of the lazy people there the rest of the EU united and said "Oh no, we want to help you poor people, but we need just a little bit of concession. Alright?" but the lazy greeks were far too lazy and just screamed "NO! Give us all your money!"

It's getting really ridiculous.
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Both stories are wrong. But countries being evil against each other has been the history since forever. Greece certainly has plenty of responsibility for geting itself in that situation that was 2010 Greece, but the treatment being offered currently called evil is fair. A couple years ago there was the valid issue that we might not know the results of it. But currently there is a clear knowledge of its failure and it is pretty clear that Germany does want to punish Greece for its defiant goverment and as an example to keep the others in line and is offering harsher unbearable terms.
 
M°°nblade;171666181 said:
The situation in 1953 wasn't even remotely comparable.
Germany didn't receive a debt relief out of altruism or solidarity but because it was a win-win situation for the creditors as Germany was expected to be able to pay back the remaining debt much faster. Greece doesn't have the same economic growth prospectives Germany had back in 1953.
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And they will never have any prospect of growing, as long as "austerity uber alles" is deemed the proper solution.
 
Oh, come on, are we now disputing the fact that German exports benefited from Euro?

Weaker currency helping exports is like Economics 101.
 
chadskin said:
https://twitter.com/stefanleifert/status/620210433266446336
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kick1-250x198.png
 
Reuenthal said:
What exactly is the mechanism in which more austerity will help Greece at this point. Explain how it will help.
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Think for a second what "austerity" actually means. It simply means "spend less". It does not say what exactly to spend less on, and it does not even prevent you from spending more where it makes sense, as long as you can afford it. So you can have austerity by getting rid of public sector bloat, privatizing state owned organizations and cutting the defense budget for example. Saves tons of money and nobody is going to starve in the streets. Other European countries did this as well, Germany included, and we're all still very much alive. What's so hard to understand here?
 
petran79 said:
Minimum is 62 years with 40 years of work, including also 2-3 years military service
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Yes, but most countries have some sort of early retirement provisions. You're joking if you think everyone in Germany can only retire at 67, it's just the statutory retirement point, which is now the same for Greece.
 
M°°nblade;171666652 said:
But it is the proper solution.
Growth cannot be achieved by piling debts and lack of structural reforms. What do you all the other EU countries are doing?
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Reforms cost money. You can't implement proper reforms if you're running a 3.5% primary budget surplus. Most other EU countries aren't actually following Greece. The country which is "most similar" to the Greek situation right now, Portugal, is running a 4.8% budget deficit - which is probably why their immediate prospects are much better than Greece's.
 
KingSnake said:
Oh, come on, are we now disputing the fact that German exports benefited from Euro?

Weaker currency helping exports is like Economics 101.
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No, people are disputing that the only reason Germany prospers is the Euro. There are a lot of other reasons as to why Germany is doing well globally. A weak Euro is one of them, but Germany's export has always been well-off due to many other factors that no one mentions.

There's shitty propaganda on both sides. Germans being well off due to the Euro is about as much of an argument as Greeks being off worse because they're lazy.
 
wsippel said:
Think for a second what "austerity" actually means. It simply means "spend less". It does not say what exactly to spend less on, and it does not even prevent you from spending more where it makes sense, as long as you can afford it. So you can have austerity by getting rid of public sector bloat, privatizing state owned organizations and cutting the defense budget for example. Saves tons of money and nobody is going to starve in the streets. Other European countries did this as well, Germany included, and we're all still very much alive. What's so hard to understand here?
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You are talking about the theory of austerity while remaining completely ignorant of the practice of austerity in Greece and its consequences. There is a certain misunderstanding you fall into by using the word austerity to describe different policies. The size of austerity matters. And we have economical data to judge results. See and Read: http://www.bloomberg.com/news/articles/2015-07-09/how-much-austerity-has-europe-actually-endured-

The size of the austerity that happened and demanded means exactly that, you can't do it only by targeting the public sector alone, and even that has its breaking point. And Greece never achieved as high surpluses as it would need to, to sustain this new plan. Which won't be able to solve the debt issue at the end and will lead to new increases of austerity as well and a new program. And during its years of implementation as usually their projections are too optimistic. Really, sooner or later there will be a grexit in reaction to it.


Now, Greece pulling a Germany in terms of austerity would mean in early 2000s to do the kind of austerity Germany did.
And although it would be harsher than what the Germans did, nearer to the German austerity but kind of different enforced austerity would be more recently during this crisis to do austerity that targeted wasteful excesses of Greek public spending and some more limited targeted taxation, not the rest and be much smaller. However the programs were big enough and will continue to be that there isn't room for targeting only bad spending (which during a recession might also have negative effects). That is the reality. Theoretical discussions about austerity is for another issue, when it comes to the policy that Greece gets to enforce, you need to look at the data and results of what was asked of Greece and of the results of enforcing the new program. Not a nebulous theoretical austerity. But this kind of austerity. And this kind of austerity has caused plenty of human misery, economic disaster and yes hunger as well.

And that is without even touching the issue of currency.
 
snap0212 said:
No, people are disputing that the only reason Germany prospers is the Euro. There are a lot of other reasons as to why Germany is doing well globally. A weak Euro is one of them, but Germany's export has always been well-off due to many other factors that no one mentions.

There's shitty propaganda on both sides. Germans being well off due to the Euro is about as much of an argument as Greeks being off worse because they're lazy.
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Of course it'd be silly to say that Germany "only prospers" because of the Euro. If the Euro and the ERM had never come about, Germany's economy would have been different from the start, and would probably have followed most other mature economies by going more into the service sector and finance - industry wouldn't have just disappeared into nowhere, it would have been replaced by other sectors. However, given that all other mature economies followed this route, it would have been a much more competitive niche to be in, so Germany would certainly have been less prosperous. The other kicker is that the industrial sector has more well-paid openings for low-skilled workers, so the German working class has *definitely* benefited from the Euro.

If you have some sort of actual argument as to why this is not the case, then let's hear it.
 
snap0212 said:
No, people are disputing that the only reason Germany prospers is the Euro. There are a lot of other reasons as to why Germany is doing well globally. A weak Euro is one of them, but Germany's export has always been well-off due to many other factors that no one mentions.

There's shitty propaganda on both sides. Germans being well off due to the Euro is about as much of an argument as Greeks being off worse because they're lazy.
Click to expand...

Nobody in this thread said that Germany won't fair well without Euro. But Germany benefitted (arguably the most) from Euro. Germany economy is better because of Euro than it would have been without.

Without Euro Germany would have faced similar challenges like Japan and Switzerland.
 
KingSnake said:
Nobody in this thread said that Germany won't fair well without Euro. But Germany benefitted (arguably the most) from Euro. Germany economy is better because of Euro than it would have been without.

Without Euro Germany would have faced similar challenges like Japan and Switzerland.
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Japan is actually a pretty good road-map of what a Euro-less Germany might have looked like.
 
wsippel said:
Except it does, it just needs to be implemented correctly. Basically, austerity and throwing more money at a problem are equally likely to work or fail in a given situation, it's just that the latter delays the inevitable a bit and makes you crash even harder. What Greece needs is structural reforms first and foremost. Until those are properly implemented and work, austerity is the way to go.
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Please provide data showing austerity working for anyone with a currency peg or in currency union.

I will be waiting. For a very long time.
 
Crab said:
Japan is actually a pretty good road-map of what a Euro-less Germany might have looked like.
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Yeah, initially I wanted to give only Japan as example, but then I thought that a structural change of German economy towards Swiss economy would have been still possible.
 
Crab said:
German balance of trade here:

http://www.tradingeconomics.com/germany/balance-of-trade

Spot the Euro (by setting the dates to run from i.e. 1960-2015). The other bump is the ERM.

If you want a comparison, the United Kingdom's balance of trade is almost identical to Germany's up until the ERM and then the Euro. The Euro saved German industry.
Click to expand...

You do realize that's just nominal Euros? That kind of comparison makes no sense. Comparison by % of GDP are much more interesting, and while the figures will still show that the current trade balance is the highest since the end of WW2, you'll see that Germany almost always exported more than it imported ("although" it had the strong DM) and had trade surpluses of up to 5% of GDP prior to the Euro.

Also one major reason for Germanys current huge surplus is the weak Euro. Now why is the Euro weak and has Germany done anything to make it weaker? No, actually they are the ones strongly opposing a weak Euro... Feel free to criticize Germany for whatever they have actually done, but by now it just seems like Germany is responsible for any- and everything.
 
Crab said:
Japan is actually a pretty good road-map of what a Euro-less Germany might have looked like.
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How so? I've spent the last couple of months reading up on the German economy (past, not present) for Uni, but haven't had time to really get into the Asian countries - that's for the next semester, but I'm intrigued. Care to explain? :)
 
Frankfurter said:
You do realize that's just nominal Euros? That kind of comparison makes no sense. Comparison by % of GDP are much more interesting, and while the figures will still show that the current trade balance is the highest since the end of WW2, you'll see that Germany almost always exported more than it imported ("although" it had the strong DM) and had trade surpluses of up to 5% of GDP prior to the Euro.

Also one major reason for Germanys current huge surplus is the weak Euro. Now why is the Euro weak and has Germany done anything to make it weaker? No, actually they are the ones strongly opposing a weak Euro... Feel free to criticize Germany for whatever they have actually done, but by now it just seems like Germany is responsible for any- and everything.
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Germany is not opposing a weak Euro, they are opposing inflation, which is a different thing. Through the Euro they achieved a weaker currency without actual inflation.
 
Frankfurter said:
You do realize that's just nominal Euros? That kind of comparison makes no sense. Comparison by % of GDP are much more interesting, and while the figures will still show that the current trade balance is the highest since the end of WW2, you'll see that Germany almost always exported more than it imported ("although" it had the strong DM) and had trade surpluses of up to 5% of GDP prior to the Euro.
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Yes, I know it's nominal. I left it nominal because percentage GDP comparisons don't always make sense when we're cross-comparing between countries - a country that goes through a recession and focuses on a trade boom to recover will skew the data, for example. If we do want to focus on percentage of GDP;

german-current-account-to-gdp-ratio.png


or further back from the 1990s;

qe-289-2-uk.jpg


In both cases you can see the boom that accompanies the Euro.

Also one major reason for Germanys current huge surplus is the weak Euro. Now why is the Euro weak and has Germany done anything to make it weaker? No, actually they are the ones strongly opposing a weak Euro... Feel free to criticize Germany for whatever they have actually done, but by now it just seems like Germany is responsible for any- and everything.
Click to expand...

I mean obviously you don't want your currency to be *too* weak or foreign imports are too expensive. However, in this case I suspect Germany doesn't want the Euro to be weaker because that means inflation, which is opposed for largely political reasons rather than economic ones.
 
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