It's unfair to Mr Mcwilliams for the final sarcastic comment. I admit to understanding very little about economics but I did find the article very illuminating. He offers a challenging case for at least some blame being put at the feet of the German administration surely ?
Maybe you can offer some proof to refute these accusations against Germany Peter ?
Hi again - I pulled this off the BBC web site, which says more elegantly what I posted previously.
"Five years into its austerity regime, the Greek government has once again had to go cap in hand to its creditors and ask for more money.
But the country's complex tax system seems to be one of its biggest hindrances.
The former head of Greece's tax collection agency, raising taxes in the midst of the financial crisis, told the BBC "it was not an easy job to do".
Probably a masterful understatement, given Greece's recent past.
Harry Theocharis is now an MP, but used to be the most wanted man in Greece - and not in a good way.
It was his job to try to raise taxes in the middle of the financial crisis and try to reform the notoriously inefficient tax system itself.
To give just one example of the complexities Mr Theocharis wrestled with: in Greece there are six different rates of VAT. The normal rate is 23% - there are two reduced ones for items such as food, fuel and medicine.
But the Greek Islands enjoy reduced rates of VAT to encourage people to stay in remote parts of the country and to help the vital tourism industry there.
That makes six rates in all, and creates plenty of opportunities for dodging tax.
A recent surge in tourism on the island of Mykonos for instance seems to have led to lower payments of VAT to the Greek government.
Greece also has a pension system that is amazingly complex, with numerous exceptions for different jobs allowing for early retirement.
The pensions are not very generous on average, but overall the Greek government is spending 30% more on pensions than the British government does. The whole system is in desperate need of simplification in order to make it cheaper to run.
Then there are the privatisations. At the start of the crisis, the Greek government committed itself to bringing in €50bn from the sale of state assets. According to Mr Theocharis, that target was soon reduced to €30bn and then €20bn.
In total, the government has managed to raise about €2-3bn so far.
Things like the privatisation of the port of Piraeus are supposed to be bringing in more, but they have been delayed, cancelled and then re-launched. it is still waiting to be privatised!!
Greece may have just wasted five years of its bailout period
Then there are the cuts that have been reversed, such as the reopening after two years of the state broadcasting company ERT, which started programmes again this year.
The problem therefore is not so much that Greece is incapable of reform or does not know what needs doing, but that it has wasted five years of the bailout without making serious attempts to fix the structural problems that beset the economy - and in many cases it is actually going backwards.
If it had started five years ago, it might have been seeing the results by now as countries like Ireland and Spain have done, but one of the reasons that the Greek bailout has reached another crisis point is that it has hardly started.
It is not the kind of record that is likely to make the countries that are lending Greece all that money trust them with some more."
But you are right, taxing the poor more is self defeating, and offensive to any reasonable person but that is the mess the Greek Governments have created and which the present Government is unwilling to confront.
Again, much like the UK, cuts are needed. First you have to accept they are necessary and then decide what and more importantly when. I am no socialist but I have some sympathy with the view that the necessary cuts in social spending are necessary but could be spread out over more time then the Gov't appears to plan.
Yes a view of the world but not one that I share. In fact you may notice that Ireland is not planning to default, nor is any other EU country. As I say, other countries in the EU mostly in eastern Europe, took the hit, went thru an internal devaluation as indeed did Germany a few years ago to restore competitiveness and arguably as the UK is doing now.
But you make my point.
Indeed, the tax system doesn't work and hasn't worked for the last 5 years but no action has been taken to put it right. It is nobody's fault save the Greek Government for its failure.
The Port of Piraeus should have been privatised but again no action has been taken.
Too many people work for the Government and my wife who worked there for a while can tell you they did mostly nothing as there was nothing to do, but they all retire early on great pensions.
Greece is the UK writ large but with a Government unwilling to tell the truth but hides behind socialistic economic nonsense, see also Mr Hollande and France, which does not produce the results.
And of course, let's blame the Germans for everything. That will definitely solve the problem (not!)
Actually Greece has made great strides in fixing it’s economy. Certainly more so that Ireland which is prancing around as the best boy in school at the moment. May I suggest you read the attached article by an economist pal of mine. He forsaw the Irish propert market crash and I value his opinion highly.
I couldn’t agree with you more Peter. I think where the confusion comes in is that people genuinely believe that the government has money without realising that all they have is what they already took from us. I think the Greek problem is more deep rooted. They believe that paying tax is optional and most people chose not to. Hence the excessive borrowing.
I have mixed feelings about Greece.
As always the poor suffer worst from the political nonsense of their leaders and they deserve our support.
Other countries in the Euro zone have reformed their economies in the last 5 years, but the Greeks have done SFA and now maybe they will start the necessary reforms but from a far worse position and which will take longer to recover.
Like the rest of Europe including the UK, they have paid themselves a life style they cannot afford on borrowed money. We can debate how fast our debt has to be paid down but paid down it must and the lifestyle of state spending reduced to the point that it is affordable.
Running a country, whilst much more complex, is like running a home. You can only spend what you can afford . Quite why politicians and others find that so is difficult to understand