| routsounmanman said: So, if I get this correctly, in the short term, defaulting is not that bad. In the long term, you lose total credibility, noone loans you any money, stocks and bonds drop, and since you are all on your own, harshly increasing taxes is the only way to prevent the deficits! In the end though, are things any different now? I really don't think the measures taken will make our corrupt government and economy to recover; unemployment will rise, people will burst in anger, and the deficits will at best stabilize. All I see is increasing taxes, while there should be a major public sector slash. As I've said, we have 8x public sector employees than the United Kingdom, and they are even bloated as it is! Moreover, nothing is done to prevent tax escape (I don't know the economics terms for this) and corruption, thus increase in taxes will affect only the lower classes, which are already suffocating >_> Sometimes I really think we should just leave the EU, or at least revert to our old currency. The only benefits we've had so far are lower interests on loans (which are quite high, mind you) and lower import prices, which is offset by greedy importers. PS: Our clergy is considered public sector employees and paid by our ridiculous taxes. Cutting off the church should be our top priority. |
Defaulting is not that bad. Yes it is stupid to let debt grow so large that you have to default, but defaulting is in fact the only real way of solving the problem.
Investors lost credibility in Greece (as they will lose in other countries in the coming years), and they sure as heck can't get confident again by seeing Greece grow its debt even more (i.e. a "bailout", which is in fact just delaying the problem).
What many politicians in other EU countries aren't saying is that the Greek bailout is largely also a bailout of their own banks, which would take a big hit if Greece defaulted.
My Mario Kart Wii friend code: 2707-1866-0957
