Saturday, July 14, 2018

The Farce Of EU Elites' Jubilation About Greece

Tansparency International has published a report on the "Evaluation of the Level of Corruption in Greece and the Impact on Quality of Government and Public Debt." Here are the highlights (very interesting reading!) and here is the full report.

The highlights list 10 "other key facts" (other than corruption) which underline my previous argument that the recent jubilation by EU elites about Greece having turned the corner were rather a farce.


  1. You're right...


    1. Lost tax revenue- An estimated $83.6 billion in lost economic activity to the shadow economy resulting in $28 billion in lost tax revenue. p-35
    2. Population decline- Over 360,000 of Greece’s best educated and trained have emigrated since 2009 and two thirds of them have college degrees. p-42
    3. Inequality is growing- Over one third of Greeks are below the poverty line and the percentage in extreme poverty went from 2% in 2009 to 15% by 2015. p-38


  3. You beat me to it. I read the one page highlight at Friday and the whole thesis over the weekend. I have filed it, I have a feeling it's not the last time I read it. It confirmed my gut feeling that the Greek economy has gone underground. The business climate has become worse, tax cheating and corruption has become worse. What I took away from it was two things:
    It is a crisis in values.
    If corruption was reduced to EU average there would be plenty to pay the debt and reduce taxes.
    We are back to what Daniel Gros said 5 years ago "starve the beast". I just don't think that will happen, the EU has joined the Greek battle cry of "SME's are the backbone of Greek economy", they will finance them in so many ways. It's just that SME's are not the backbone, they are the bane of Greek economy, as this thesis so amply highlights. As long as you can write a thesis like this there will not be serious investors coming to Greece, and certainly not Green field investors, which is what she need.

  4. The EU "elites" were only concerned with fiscal policy, that's why they were jubilant. Now that Greece has seen the light and pursues restrictive fiscal policy, they're happy. Just like the Maastricht criteria only dealt with government debt and deficits. This of course only goes to show how ideologically blind the EU "elites" are.