A very good answer would be to ask her to come and live in Greece for two years, but to save her the shock... I will share a few sporadic thoughts.
The official unemployment rate among youths (below 32 IIRC) it's 50.60% today. Given the fact that part time jobs like working as a delivery boy counts as employment for the prior government, you can rest assure that finding a steady salary in Greece these days is extremely hard.
In the private sector almost no one is going to give you a full time job. If they do, you're expected to work at least 10 hours per day, maybe more, while you're officially paid for ~ 8.
The local social security found takes a large cut of your salary ~ 30%. Then you are taxed. Last year taxes rose at incredible levels. People lost their houses because by governments math, if you owned a house at some remote location, mostly parent's heritage, theoretically you had a income even though you resulted as unemployed. This led to extremely tragic situations where people became homeless overnight. There are other taxes like these that add up to your electricity bill. Can you imagine living without electricity? What would you if you had to choose between having EUROs but not having electricity at home or having Drachmas and having electricity at home?
Although in current Greece you pay a large amount of your income to social welfare state, that's totally inexistent. You have to double pay for your child's school, because he will never get into the University if he doesn't take extra (private) classes. You have to double pay for your health if a member of the family has a problem. Drugs became increasingly more expensive, although the prices of the actual drugs in many cases where slashed, because of added taxes at every drug prescription.
In Greece we had ~ 7.000 suicides in the last 6 years. We became from last country in suicides, to first in the EU on average, within 6 years.
[...]
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That's only the tip of the iceberg. Greece, is a third world country right now and the population is suffering. That's why a large % of the population doesn't care much about staying in the EUR or not.
Also note that among the Greek population there's a feeling that Brussels and Germany is heavily corrupted[1]. Indeed the fact that Berlin and Brussels so openly support the governments and oligarchs who created the financial crisis in Greece instead of punishing them, says a lot IMHO about their real interests. Most of the bail-out money went to French and German banks who held Greek Bonds.
So the private banks got away with high-yield Greek bonds while the Greek and German tax-payer had to pay the difference.
---
Now that said, it's not like everything is Greece was okay. We have an extremely awful local elite who act as an oligarchy. Indeed Varoufakis refers to them as "Oligarchs", because that's what they are. In Greece we never had a justice estate. I don't know how are things in Latvia, might be better or worst I don't know, really I don't.
Anyway Greece needs restructuring. It needs a wages alignment, but if anything, the average wage has to go up not down.
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In view of current events, are you sure that entering the monetary union, was a good move in the long run for Latvia? I mean Czech Republic didn't enter the EURO nor Switzerland. I see them both extremely happy that didn't.
To be clear, I don't wish anyone this kind of suffering! At the same time, all you mention seem to be very similar to what the Latvians went through in 2009.
I do see the difference of the enormous Greek state debt after years of structural overspending by the Greek government. Latvia simply had almost non-existing debt before it went through the 2008-2009 economic crisis.
You say "Also note that among the Greek population there's a feeling that Brussels and Germany is heavily corrupted." The EU structures seem to be intact, if serving other (corporate?) interests than you and I would like. Greek structures seem to be crumbling under corruption much more.
I'm genuinely interested in how you would ideally see Greece regain solvability.
Kind regards,
Mark
P.S. In the case of Latvia, eurozone was not an option. It was a requirement of joining the EU. Will that be good or bad in the long run? They lost a bit of economic flexibility (no independent currency floating possible), but they still have an internal devaluation as an option. They used that once. Basicly, lower wages by 20% by decree and make local products cheaper that way. Socially quite insensitive instrument. On the other hand, jobs are plenty again here...
I don't know if the Latvians went through a similar situation in 2009, but Greece is in this situation for 6 years and no one feels that it's going to end anytime soon. Indeed large part of the population[1] is semi-depressed on a daily basis.
There's another part that's important to mention here: Greeks have been heavily accused of being lazy and corrupted. Of course there are lazy on corrupted people in Greece. But the majority is not like that. Indeed, I dare to say that Greeks are among the most hard-working people in Europe. No one I know works the pre-determined hours. EVERYONE works overtime, me too of course. This accusation led to a feeling of lost dignity which now SYRIZA is trying to restore.
Most Greeks don't even know when that happened, but I know... It was first the 'Karamanlis' government who initiated the myth of Greeks not paying taxes and then Papandreou went over the roof making rounds in Europe stating that he is the PM of a corrupted country in order to avoid all responsibility for non-taxing the local oligarchy.
In a sense, Greeks, deserved to be punished because we supported (as a nation) largely corrupted politicians. It's easy to blame, it's a lot more complicated in real life, but I won't bother you with details. Truth is that there are no innocents.
However, we found ourselves in a spiral of a Crisis that we didn't create, private banks did. I feel that Greece was the weakest link.
In 6 years of austerity, Greece has implemented so many reforms that no other first world country had ever made. It create a (I believe false, but whatever) surplus last year, but at a huge financial and social cost. The troika's program, led the debt (which in theory everyone wants to lower) go from 125% to 180% of the GDP. Clearly, it doesn't work for us.
From the amount received by the troika, only 11% went to Greece. The rest went to pay Greek maturing bonds held by French and German banks. Doesn't make sense to me. At the same time, Germany was selling broken submarines in Greece and military equipment. Indeed the only part of the public spending that wasn't slashed was the military spending. I assume that is because most of our military expenditures came from Germany and France.
In 2001, Greece falsified the countries stats to enter the EURO. Everyone knew. Personally I believe that many other countries did the same (Italy, Portugal and probably others). What is known now, is that everyone knew but didn't care at the time. The man who made this possible was Loukas Papademos. He acted as a bridge between Goldman Sachs and the Greek government. Loukas Papademos was A. Merkel's choice for PM after Papandreou resigned and country for some reason wasn't ready for elections. Isn't that a strange choice to make? It looks very suspicious to me to choose to work with the same people who accuse of fraud. Mostly in the same vein, Germany supported the same parties that brought Greece, financially speaking, to it's knees... Which doesn't make sense to me.
The current government is the first clean government in 40 years. It might our last chance to straight up the country.
> I'm genuinely interested in how you would ideally see Greece regain solvability.
I like Varoufakis (our new FinMin) "Modest Proposal"[2]. Varoufakis believes that, although Greece has it's fair share of problems as is, the Eurozone crisis is mostly structural. It's not a Greek problem, it's a European problem. Many renowned economists have expressed the same idea. You might be familiar with Paul Krugman and Joseph Stiglitz for example, two American economy nobel-winners, but there are many others which believe so in mainstream financial media magazines like the NYTimes, FT, WSJ, The Economist, etc.
That said, I believe that the Greek economy is a symptom. Greece has a total lack of justice estate. If the current government manages to re-structure our justice estate in order for it to break the chains of corruption, the rest will follow.
Sorry for the long response!
Take care :-)
[1] I live in a small town in North Greece. The crisis didn't strike our town as much as other major Greek cities. I work with people, elderly mostly and I get a first-hand idea of how they feel.
A very good answer would be to ask her to come and live in Greece for two years, but to save her the shock... I will share a few sporadic thoughts.
The official unemployment rate among youths (below 32 IIRC) it's 50.60% today. Given the fact that part time jobs like working as a delivery boy counts as employment for the prior government, you can rest assure that finding a steady salary in Greece these days is extremely hard.
In the private sector almost no one is going to give you a full time job. If they do, you're expected to work at least 10 hours per day, maybe more, while you're officially paid for ~ 8.
The local social security found takes a large cut of your salary ~ 30%. Then you are taxed. Last year taxes rose at incredible levels. People lost their houses because by governments math, if you owned a house at some remote location, mostly parent's heritage, theoretically you had a income even though you resulted as unemployed. This led to extremely tragic situations where people became homeless overnight. There are other taxes like these that add up to your electricity bill. Can you imagine living without electricity? What would you if you had to choose between having EUROs but not having electricity at home or having Drachmas and having electricity at home?
Although in current Greece you pay a large amount of your income to social welfare state, that's totally inexistent. You have to double pay for your child's school, because he will never get into the University if he doesn't take extra (private) classes. You have to double pay for your health if a member of the family has a problem. Drugs became increasingly more expensive, although the prices of the actual drugs in many cases where slashed, because of added taxes at every drug prescription.
In Greece we had ~ 7.000 suicides in the last 6 years. We became from last country in suicides, to first in the EU on average, within 6 years.
[...]
---
That's only the tip of the iceberg. Greece, is a third world country right now and the population is suffering. That's why a large % of the population doesn't care much about staying in the EUR or not.
Also note that among the Greek population there's a feeling that Brussels and Germany is heavily corrupted[1]. Indeed the fact that Berlin and Brussels so openly support the governments and oligarchs who created the financial crisis in Greece instead of punishing them, says a lot IMHO about their real interests. Most of the bail-out money went to French and German banks who held Greek Bonds.
So the private banks got away with high-yield Greek bonds while the Greek and German tax-payer had to pay the difference.
---
Now that said, it's not like everything is Greece was okay. We have an extremely awful local elite who act as an oligarchy. Indeed Varoufakis refers to them as "Oligarchs", because that's what they are. In Greece we never had a justice estate. I don't know how are things in Latvia, might be better or worst I don't know, really I don't.
Anyway Greece needs restructuring. It needs a wages alignment, but if anything, the average wage has to go up not down.
---
In view of current events, are you sure that entering the monetary union, was a good move in the long run for Latvia? I mean Czech Republic didn't enter the EURO nor Switzerland. I see them both extremely happy that didn't.
[1] https://anestis.quora.com/Links-to-credible-sources-about-Gr...