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No it's not. Greece doesn't have a manufacturing base. Public employment is what it survives on. Without austerity, there wouldn't be any problem retaining this model.
That's great, but Greece cannot spend the next 50 years borrowing from Germany to keep its bloated public employee base afloat. It is remarkable that the German taxpaying public has not revolted in an uprising, its their money that the greeks have been passing away.
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You're forgetting that the US government is the biggest employer in the US. Imagine if the US was to fall under a constraint that Greece is under. You will see massive layoffs and food lines. There's a reason why Washington DC is a thriving metro.
LOL, you think that hasn't already happened? Been around the country lately, there's tent cities and mass homeless all over the nation.
BTW, do you think that when the chinese decide to stop buying US treasurys that there won't be a total meltdown here? Better start learning how to farm my friend, if you want to eat in a few years.
lets look at facts. Sweden, Denmark, and Norway for example have 29.25-33.87% of their workforce employed by the government. This is the "untenable" situation you comment on.
Is that why sweden and norway have been importing large numbers of muslims? And given how sparsely populated those countries are compared to the US, they are not comparable. Denmark has what, 5 million people? There's more people in Brooklyn and Queens. Plus it has huge oil reserves.
There are many reasons why those countries have decent economies and greece does not, but having a public sector of that size is a drag on the economy.
Finally, sweden is not doing as well as it used to:
Please point to where Krugman listed infinite government employees as workable. Ohhh...right. They never said that, its just a convenient comment to drive your inaccurate idea of how things should be.
Krugman is an idiot who is well known for looking at public employment and spending as a solution to almost any economic issue.
As bad as of shape Greece is now, electing the far left wing radicals to power just took it up a notch..... That is if Tsipras is true to his party platform. If he is all talk, maybe things wont go from bad to worse. If he does indeed ask for a 50% haircut, a restructuring of debt payments, and negate troika agreements, the IMF and Merkel will give Greece the boot out of the Euro.
Check this out:
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Finally, SYRIZA’s six priorities are, according to Tsipras, free electricity to households that are unable pay their bills, food allowance to 300,000 people, free healthcare, Christmas bonus to low income pensioners, free transport card for the poor and abolition of the tax equalization on heating oil and diesel
And who is Syriza? Well other than PASOK dropouts who was a less left leaning party that ruled Greece for 40 years and created this mess in the first place.... The SYRIZA founders are:
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The coalition originally comprised a broad array of groups (thirteen in total) and independent politicians, including democratic socialists, left-wing populist and green left groups, as well as Maoist, Trotskyist, eurocommunist but also eurosceptic components. Additionally, despite the secular ideology, many members are Christian who, like their fellow atheistic members, are anticlerical
IMO the EU is on it's last legs anyways with the rise of Marine Le Pen and the National Front in France, and David Cameron's pledge for an in/out referendum in the UK sometime after this year's general election (assuming of course that the Conservatives don't get booted out of power).
The European Union will cease to exist by the end of the decade. This will be a huge setback for those who want the integration of the Americas from the Arctic to Antarctica as the big event of the 21st Century.
Since 1974 the Liberal-Conservative New Democracy and Social Democratic PASOK has run the country making into a morbid form of two-party system. Although, it has given the country a much needed political stability the Greek mainstream politicians have constantly bought voters with an ever increasing welfare state and public goodies. It has been financed through lending from private and government institutions.
Greece is not a high-end economy. They export petroleum oils (not crude) which is about 40 percent of their economy. The rest is food items, electronics, pharmaceutical products and Magnesium, Aluminum, Bauxite and Nickel. Their GDP per capita is just $21,857 per capita (2013) which is significantly lower than the average European Union GDP per capita which is 34,060. Still, Greece have a welfare state and goodies which is similar more similar to that of France. I have no sympathy for the investment banks and government which borrowed money to them. I personally think SYRIZA should leave the Euro-Zone and then default on their debt and later devalue their currency but this is not what SYRIZA want. It is pretty clear that SYRIZA have no intention to leave the Euro-Zone. Rather, they want their debt to be written off their books through an ECB debt restructuring. In other words, they want other countries in the European Union to pay for their governments own mistakes.
What are so much worse than the crony government in Greece are those liberal governments in Western Europe and the predatory bankers who want ordinary peoples in Northern and Central Europe to pay for harm caused by Greek politician, bankers and these liberal Eurocrats. What these people and institutions will do is to reduce some of the Greek debt and then borrow them more money which in the end will lead to an even worse collapse in the future. SYRIZA will agree and so it will all restart again.
What people need to realize is that public debt is bad. They need to realize that Central Banking and money printing is bad. They need to realize that a budget needs to be balanced and that there is no such thing as a free meal. Yes, it is the first thing I learned in business school – there is no such thing as a free meal. What we all need to realize is that our current system does not work.
Corporations send jobs overseas to they can make a profit when selling their stuff cheaper to consumers. When the corporations discover that people cannot buy their stuff because they have lost their jobs the bankers step in and borrow money to the unemployed with the help of government so the ever increasing consumption of stuff can go on. Government also helps the corporations even more by allowing large scale immigration enter so salaries can be dropped so corporations can earn even more money. Consumption rise and so do the profits for the corporations but even more people end up unemployed and even more fiat currency need to be issued to pay off debt and issue more loans. In the end the one percent is getting richer and the rest is turning poorer. We need a sound economy and sound currencies. What we need is a real market economy and not rigged market which only benefits bankers, corporations, politicians and high government officials. If SYRIZA really care for the Greeks they leave the Euro immediately and devalue the Drachma. Then they trade them back to wealth like United States did before the FED and Wall Street.
Greece if they lose EU funding is going to default which closes them from markets for years. Maybe only solution with their debt versus GDP; but it will be much more painful than the austerity.
I admit I am no expert on European governments but it always seems a little misleading to me when it's claimed they are fighting "austerity". Seems to me they are fighting the idea that the banks have to prosper even if it means the citizens have to suffer.
Granted if they think they can go back to their old ways of doing things, and that may be what they think, they are going to fail miserably but they are as much fighting the idea of "bank bailouts" as much as anything. Or that's my take anyway.
Their version of "austerity" merely means "not printing money like an explosion, to spend".
There is no actual austerity anywhere in Europe. Or anywhere.
Governments continue to direct larger and larger portions of our economy.
Is that why sweden and norway have been importing large numbers of muslims? And given how sparsely populated those countries are compared to the US, they are not comparable. Denmark has what, 5 million people? There's more people in Brooklyn and Queens. Plus it has huge oil reserves.
There are many reasons why those countries have decent economies and greece does not, but having a public sector of that size is a drag on the economy.
Finally, sweden is not doing as well as it used to:
Krugman is an idiot who is well known for looking at public employment and spending as a solution to almost any economic issue.
Norway, Finland, Denmark and Norway have a significant higher output than Greece which makes it possible for them to have larger welfare state. All these countries have their individual troubles. The price of oil is going down which effects the Norway negative. Finland refines petroleum which has lost some value because of the decreased oil prices. Denmark has deep problems with an ineffective welfare state and energy sector. The socialist-liberal regime of Denmark has really turned it upside down with their utopian dreams. At least we are allowed to say what we want and will not be fired from our jobs saying it. Sweden is actually worse off any of the Scandinavian countries. Take the worst San Francisco liberal hippies and make them run a country and you understand what Sweden has become. It has a very high unemployment and an increasing public debt but still they give away much of their wealth to citizens of third world countries. They are also wasting an enormous amount of money on social projects which gives little more than just paper cuts. If it wasn’t for their highly effective private sector their hipster elites wouldn’t be able to have so much money to spend on nothing. It is actually a really scary country because debate about pressuring matters (if want to keep your job) is not allowed in public sphere.
I think Norway, Iceland, Denmark and Finland will do okay in the future market turmoil’s because there are freer debate climate here and people seem to understand some very basics in economics. Sweden will blow up when the money runs out. Many corporations (I don’t talk about international corporations but medium sized industries) are actually leaving Sweden. There is also an exodus of young academics which works in Norway and Denmark because there is little work available in Sweden. Their social capital is also dropping rapidly. There are beggars and ghettos everywhere. I kind of hope they close the Øresund Bridge because when the s… hit the fan.
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