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Under dynamic leadership, the Mediterranean European countries could look to South Korea or Taiwan as a model, if anything, not core Europe.
Not all Mediterranean countries are the same. Greece is isolated between enemies (basically all their neighbours have some territorial disputes or other kind of trouble with them) and climatically, Greece is more exposed to heat than any European country. Also, they are culturally isolated, having no linguistic or other kind of cultural corespondences with other countries or nations, like there are inside the Romance, Slavic, Germanic etc linguistic families.
These conditions creates an unproductive psycho-socio environment where with all dynamic leadership you can't do much change.
There is no legal or economic reason why it couldn't.
But the EU/eurozone is first and foremost a political thing and the eurozone is sort of like Hotel California (until proven otherwise).
If Greece were to leave the eurozone and make a relative economic success out of it (it could, but it wouldn't because their leadership sucks), then most likely Italy would be next, and perhaps also Spain and Portugal.
And that's the way it should have been since the beginning of the eurozone project, economically.
But the EU/eurozone is first and foremost a political thing.
The core Europeans do not want to kick the Greeks out, they want to kick them in the spine.
Italy and Spain have very strong economies. In fact, a large piece of the Greek debt is owed to Spain. The GDP per capita of United Kingdom and Spain is almost the same.
Greece is isolated between enemies (basically all their neighbours have some territorial disputes or other kind of trouble with them) and climatically, Greece is more exposed to heat than any European country. Also, they are culturally isolated, having no linguistic or other kind of cultural corespondences with other countries or nations,
These conditions creates an unproductive psycho-socio environment where with all dynamic leadership you can't do much change.
Countries like South Korea, Taiwan even Japan and Singapore are not exactly, or have not been, in friendly and culturally similar neighborhoods.
Greece is hot? So is Singapore. So is southern California and other parts of the United States. So are parts of Australia. So what? Why is Greece not a powerhouse, then, in solar and geothermal energy? Or in, say, software development or medicine?
There is a lot of change that could be done.
So thanks for reinforcing my point.
But in the event, the reality is that you are right: plenty of successful Greeks in Australia and the United States for example, much different psycho-socio environments.
Italy has been in recession at least four of the past six years, it has been mired in slow or no or negative growth since the early 1990s, its (native) population is declining, and the most productive and dynamic and creative have been leaving in meaningful numbers, ask Fiat, for example, which no longer exists and whose successors are no longer Italian. To be sure, Italy's problems pre-date the euro (and Berlusconi too, by the way), but the euro hasn't helped either. Why? The leadership sucks.
Spain, which is damn hot, is in much better relative shape for sure, being somewhat of a powerhouse in agriculture and even in solar power, among other things.
First, Greece's economy does not have anything to do with Italy, Spain or Portugal, being the combined economies of Italy and Spain the largest in the EEC. Greece's can't go back to the former currency because national debt and trade balance are dennomiated in euros. The country would flounder and would contitute a source of inestability for the region that the EU can't allow. Illegal immigration, Russia, etc.
The EU/Eurozone is first and foremost an economical thing.
It's quite amusing to read perspectives from Australia or from the other end of the world, it shows how media is not only biased, but lysergic.
To be realistic, Greece won't be able to pay back its debts, I think everyone involved knows that. So this wouldn't really hinder Greece to switch back to drachma, as their debt would just be written off and I think this will happen sooner or later. Greece can't achieve any meaningful growth if they stay in the eurozone, as Greece isn't a competitive country and this won't change in the near future. What they have though, are nice beaches, good climate and food, meaning if they had a weaker currency a lot more tourist would arrive as it would be cheaper, heck even I would go on vacation to Greece. So drachma it is imo.
Greece is hot? So is Singapore. So is southern California and other parts of the United States. So are parts of Australia. So what? Why is Greece not a powerhouse, then, in solar and geothermal energy? Or in, say, software development or medicine?
Greece is also very arid, the islands are mostly barren rock, has not a lush vegetal environment like Singapore. Turning Greece into a land of solar energy farms is not the best idea, as would affect the landscapes and would kill much of the tourism.
You could give a closer example, like Turkey, which is pretty similar with Greece or even hotter in respect of climate and aridity and which truly has a dynamic economy. What makes Turkey thrive and Greece stagnate? Well, Turkey was a big empire up to early 20th century, they were ruling over a great number of nations from Europe, Africa, Near East and Central Asia and having to control so many different nations has developed them organizatoric competencies and especially a social (group) mindset oriented toward the good management.
The mindset, the models valued by a nation is very important and we see this very well in the case of Germany. The German mindset of doing the things perfectly and to act in accordance with the interests of the majority is ofcourse rooted in some historical situations (not in their genetical heritage, as the nazis were believing), including the mentality that appeared during Protestantism, as explained in Max Webber's book but mostly having the roots in the medieval guild organisation and not at least, in some principles and values that were strongly promoted during the few years of nazi rule (I hope no moron will appear to accuse me of nazy propaganda), like the discipline, the efficiency and so on.
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Spain, which is damn hot, is in much better relative shape for sure, being somewhat of a powerhouse in agriculture and even in solar power, among other things.
Parts of central Spain are cold and the oceanic influence also has cooling effect. But most important in Spain's case is also the imperial experience and the mindset shared with the other Western countries, mindset valuing the work, the honesty and which must be rooted in the influence of the Catholic church, which, differently from the Eastern Christian (Orthodox) world, was a centralised, well organised institution across nations.
Concluding, any character feature a nation or other kind of human group displays is explained mostly by the natural and historical conditions.
Concluding, any character feature a nation or other kind of human group displays is explained mostly by the natural and historical conditions.
I don't buy it, sorry, too simplistic and for every instance where you could explain it that way (and still be only half right at best), there is an instance which contradicts it. Reason is, among a million others, the human mind is also an independent environment and circumstance. Too many examples in the long sweep of history to cite.
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Originally Posted by overdrive1979
Most countries won't be able to pay back its own debts...
Debt is money supply. Debt itself is not a problem, it is the efficiency of the money supply that matters. In terms of a sovereign country, it issues its own debt/money supply, more or less efficient. When a sovereign ceases to issue its own money supply, it ceases to be sovereign.
The situation in the eurozone since 2009 has been known among economists and capital market traders as the "sovereign" debt crisis, because in the EU/eurozone set up as it currently stands, no one knows exactly who is sovereign. Greece certainly is not a sovereign, until the Greeks themselves prove otherwise (and they probably won't, not by a long shot).
It appears that over the past 10-15 years at least, sovereignty lies somewhere among the European Council of Ministers (not formally part of the EU), the eurogroup finance ministers (also technically an informal gathering) and the ECB. Until proven otherwise.
Most countries won't be able to pay back its own debts...
Again most countries also control their currency so they can "manage" the debt.
Zimbabwe is an example of one way with hyperinflation.
Mexico made a new currency out of the old peso...
China weakens theirs for a competitive advantage.
Greece can do neither because they don't control the euro. They can't even issue bonds if no one wants to buy them
Again most countries also control their currency so they can "manage" the debt.
Zimbabwe is an example of one way with hyperinflation.
Mexico made a new currency out of the old peso...
China weakens theirs for a competitive advantage.
Greece can do neither because they don't control the euro. They can't even issue bonds if no one wants to buy them
Exactly.
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Originally Posted by Baertholdy
Greece will pay its debts just as the US will pay its debts,
The US yes, but almost zero realistic chance of Greece doing that. See eyeb above (and my previous post, repeated below for convenience)
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Originally Posted by Baertholdy
They can achieve a meaningful growth in the Eurozone if they overhaul entirely their economy. ... Yes, but if they had a weaker currency, they could not resort to the European Bank, so Greece will remain as is. There will be tears and tragedy, but Greece will remain.
Sure, Greece will remain. But as a practical matter, switching to a new currency, without planning, will be very, very messy.
Ultimately, the issue is not whether to be in the eurozone or not be in the eurozone. The issue competent economic and money supply management.
Politicians in Greece have shown that they cannot do either, so the Greeks, collectively, turned to eurozone officials to do it for them. And, as a result, they get what they deserve.
Only in theory, and with very little chance of practical success, could Greece return to its own currency and be successful because success depends on competent economic and money supply management, not this or that name of a currency or ideology or any other superficial illusion.
Even if Greece returns to its own currency, it will most likely need at least a year, maybe two, of humanitarian assistance in terms of food, fuel and medicine to avoid violent conflict.
In theory, I would vote no. As a practical matter, I would vote yes.
We'll see by the end of today.
Good Luck!
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Originally Posted by bale002
Debt is money supply. Debt itself is not a problem, it is the efficiency of the money supply that matters. In terms of a sovereign country, it issues its own debt/money supply, more or less efficient. When a sovereign ceases to issue its own money supply, it ceases to be sovereign.
The situation in the eurozone since 2009 has been known among economists and capital market traders as the "sovereign" debt crisis, because in the EU/eurozone set up as it currently stands, no one knows exactly who is sovereign. Greece certainly is not a sovereign, until the Greeks themselves prove otherwise (and they probably won't, not by a long shot).
It appears that over the past 10-15 years at least, sovereignty lies somewhere among the European Council of Ministers (not formally part of the EU), the eurogroup finance ministers (also technically an informal gathering) and the ECB. Until proven otherwise.
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