Deeply in debt, Greece faces a Spartan future

[Liberal_in_LA]

Deeply in debt, Greece faces a Spartan future

All eyes have been fixed on Greece since the newly elected government announced in October that its budget deficit was far larger than previously estimated -- 12.7% of the country's gross domestic product, more than four times the limit allowed under rules set for the "eurozone," the club of 16 nations that use the euro as their currency.

Skittish investors were left to wonder whether Athens would be able to pay off its debts or whether it might collapse beneath their weight.

Similar fears have spread to other countries, with markets nervous that a potentially game-changing debt crisis could engulf all of Europe's ailing "PIGS": Portugal, Ireland (some include Italy), Greece and Spain. Investors are especially worried by Spain, which has yet to emerge from recession, because its economy is large, whereas the other economies on the list are relatively small.

Mounting fears about the countries' debts have driven up interest rates on Greek, Portuguese and Spanish government bonds in recent weeks. Investors also have hammered the euro's value and raised questions about the 11-year-old currency's future.

Even a Europe-led bailout, however, would merely minimize, not eliminate, the sense of collective embarrassment on the continent.

The Greek Socialist government's new austerity plan calls for pay cuts and hiring freezes in the public sector, cuts in welfare spending, higher taxes on fuel, a rise in the retirement age and a crackdown on the endemic tax evasion and corruption.

http://www.latimes.com/news/nation-and-world/la-fg-greece-crisis10-2010feb10,0,6844581.story

[Yurovsky]

1. The last line really got me thinking...

and a crackdown on the endemic tax evasion and corruption

I wonder how much of our nation's debt would be eliminated if those who have enriched themselves actually PAID THEIR FAIR SHARE. No more loopholes, tax shelters, Swiss bank accounts, etc.

And corruption... probably accounts for 1/3 of the Pentagon budget.

[Chisox08]

2. This is Sparta!

I couldn't resist.
Back on topic. The government of Greece should have cracked down tax evaders years ago.

[timeforpeace]

3. Those don't sound like Socialist policies.