Thursday, 20 October 2011

How Greece “works”...

“The Greek civil war, and the bloody score-settling that followed, is a living memory for many Greeks. Any consideration of Greek nepotism or clientelism needs to be seen in that light”.

1/2 the Population are basically Extreme Lefties who fought to create a Commy utopia in the Greek Civil War. None of this 50% pay any tax and have state created non jobs in the public sector, are on welfare or benefit from the generational pensions the government has dished out like Nigerians dish out 419 Emails. Seriously, in Greece as a sibling you can collect the pension for somebody who is dead but worked for the government. Their idea of political discourse involves a glass bottle, a piece of rag and some petrol if they’re feeling generous, November 17th if they’re not. These civil servants jobs for life are, and are, to quote the economist “not a cultural quirk, in which Greek officials simply like coffee and backgammon too much to do any work. It is the end result of a brutal, multi-decade power struggle between the left and the right: a struggle that got people killed within living memory”. These pointless public sector jobs were created to give ½ the population that lost the Civil war and who support the PASOK (Greek Socialist Party) a way of integrating into the general economy and live middle class lives.

Obviously – and despite the Public Sector saying otherwise – these jobs are non-contributory to the economy in anything except a non definable way (e.g. Getting Cabin Boy 2nd Class Popodopolopolis back to work on his Oil Tanker after indulging in too much Ouzo by pumping his stomach out and providing a state bus to take him back to Port). The Public Sector doesn’t pay tax – it recycles tax taken from the private sector (again a concept that is actually Alien to the average Public Sector worker) so has a finite ability to be supported by the Private sector who have the ability to generate wealth. Naturally the Bubbles couldn’t afford to pay 50% of its own population to do feck all, even if the wages aren’t that great, so it joined the Euro where it could borrow all the money it needed to buy off its war losers at Bundesbank 0.37% rather than Greek Drachma 9-10%.

Now they couldn’t just go ahead and borrow money at 0.37% - they were paying 10% for a bloody good reason, as anybody who has seen the amount of zeros on an old Drachma Bubble bank note will attest. But the “Ve are all forward progressive Europeans together Ja?” crowd wanted the Greeks in so they could “rid Europe from the scourge of war” and claim a trip to their Holiday Villa under European Parliament expenses. So they did what the good folks at Enron and those packaging CDO’s did – they went off balance sheet. Not unique, Gordon Brown did it over here, but the scale of the maskirovka required real experts – so they shipped in Goldman Sachs to show them how to do it. Job Jobbed they fiddled the figures and entered the Euro in a way that made Bernie Madoff look like a rank amateur. Unfortunately you can’t defy Financial Gravity forever, although EU politicians are trying to do just that with endless and ever increasing bail outs.

The other half of the population are Extreme Rightists who supported the Colonels regime in the 1970’s and who – although winners in the Civil War were made to pay to secure the peace of the losers of said war. Their idea of political discourse would be a tap dance on a Trades Unionist set of testicles followed by exile to whatever barren windswept island doesn’t have drugged up European nightclubs on it. These people all have jobs in the private sector and can be divided in two – 25% of the Middle Classes who pay taxes and 25% who are rich enough to have offshore accounts and who pay no tax (nor to be fair use any Greek public services other than Roads and Air Traffic control that makes sure they don’t stick the nose of their Lear Jet into a hangar door). Greece isn’t going to persuade the Offshore 25% to bring their money back – just isn’t going to happen; forget about it. And furthermore Greece lack the international clout to force the countries where the 25% have their bank accounts to do so. After all they know where the money ends up – in the pockets of a Public Sector employee who doesn’t turn up for work because his job is so useless they don’t have a seat or a desk for him. So that leaves the poor 25% permanently fucked paying for jobs like a 50,000 Euro per year Public Sector Water Pourer for the Prime Minister and 779,999 of his ilk.

So what needs to happen? Because as the Spectator's graph shows, right now it isn't looking good. Well right now Greece’s GDP Per Capita is $30,400. This is not because the Greeks are $30k efficient, but down to subsidies and biblical levels of borrowing. Bulgaria’s GDP Per Capita is $14,000, Macedonia is $10,700. Basically they need a minimum 18% drop to match Portugal’s GDP per Capita or a 40% drop in standards of living to compete with its regional neighbours. It’s been done before Argentina did it. But it hurts like fuck and Argentina had the “advantage” that it had thrown their home grown Communists out of C-130’s over the Antarctic Ocean 20 years before, instead of letting them grow up to be the head of the local Trades Union branch or MP for Nikos Kazantzakis South.


John Page said...

Enjoyable post.

They were only in it for the money. Once they've (inevitably) defaulted, should we keep giving them more subsidies?

It's only too clear what happens to the money.

Skimmer said...

My favorite Greek statistic -

Corinth collected a grand total of €18,000 of VAT in six months,news-comment,news-politics,richard-ehrman-greece-needs-years-not-months-to-sort-itself-out,2

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