Greece gears up for tough reforms

[Mr Khan]

SamuelRSmith said:

routsounmanman said:

SamuelRSmith said:

routsounmanman said:
This latest "austerity" package will kill us. Our economy will contract a further ~6% AT THE VERY LEAST. We should just default and go back to the drachma. Greece would fill with tourists yet again (maybe even more so, with Spain, Portugal, Italy,etc in the Euro)

If you default, you'd have to have austerity, anyway (as you'd have to balance the budget IMMEDIATELY, as in, not a single dollar borrowed - no one would lend to you). If you go to the Drachma and start "printing your way to prosperity", then you'll suffer extremely high inflation, and austerity.

Which option do you want to take?

Easily the second one; at least then, we'd have some pride and dignity. Right now, we're paying for the faults of our useless politicians, and we've become EU's black sheep. Everyone wants us out, and makes stereotypes like we're lazy, live richly, etc.

As a saying goes, "a poor country can get back on it's feet; a humiliated, never"

PS: Also, please tell me if you have even a sliver of hope that this package will get us out of this mess, ever. Deficits will bring more auterity, which will bring more deficits, etc. It's a vicious cycle the one we're in, and there's no way out, unfortunately...

Well, I seem to have a completely different view to you on how society would survive. You seem to think that just because the Government cuts spending, everybody will be poorer. I personally think that society and individuals would thrive with the smallest possible Government. If anything, this could be Greece's greatest opportunity.

Greece should default, and have its own currency (or not, as I suggested in the second half of my post). However, Greeks would have to accept that it's 100% living within their own means from now on. If the tax revenues don't match up to the spending, the spending drops. No alternative.

If Greece was to liberalize her economy - no/limited public health care/education, no welfare, no state pensions; all the Government would do is provide military/police/court system. No income taxes, no sales taxes, no import taxes. I would say with 100% confidence that the country would start to turn around within a year. Within a decade, Greece would be the wealthiest it's ever been. Within a generation, Greece would have one of the highest per-capita incomes in Europe.

But the politicians, the Eurocrats, the education system, and the unions, and the establishment media, have all told you (and me) that we cannot survive without state support. Why won't they do what I suggest? Most politicians are smart men, they know what I'm saying is correct. But they don't care about you. They don't care about your job. All they care about is themselves, and if they can't control you, they won't accept any alternative.

Haphazard, headlong rushes to privatization have been attempted before. Russia called it "shock therapy" in 1992 and they defaulted by 1998, with a great many private and public workers stuck in wage arrears.

Liberalization is not a bad idea, but it needs to occur responsibly, or else you're going to end up with the bulk of people worse off than they were under even a stricter socialism than Greece possesses currently.