Galbraith on Greece

[santafe2]

Re: Galbraith on Greece

I have seen situations where a course has been set and a disastrous end is inevitable.
Just before the inevitable disaster the people who set the course relinquish control.
Some poor fool steps in and finds himself in charge when things blow up.

Hum...Bernanke?

[gnk]

Re: Galbraith on Greece

Thanks gnk. It is great to have your firsthand posts from within Greece.

I have seen situations where a course has been set and a disastrous end is inevitable.
Just before the inevitable disaster the people who set the course relinquish control.
Some poor fool steps in and finds himself in charge when things blow up.
He gets the blame.

gnk, do you think this applies at all to the leftists in Greece?
Was there anything they could have done differently to avoid economic disaster?

Before Syriza came to power, the economic situation had actually stabilized and the economy was slowly improving. The elections could have been avoided, in my opinion, but I think the previous Prime Minister was overconfident, and Tsipras overzealous and aggressive. Parliamentary systems are not as stable as the system the US government has. Snap elections are not uncommon.

I think Syriza/Tsipras was worried that Samaras, the previous PM, would get a lot of credit for the rebound. So Tsipras started making outlandish promises, especially for a nation that is basically insolvent and still dysfunctional. But keep in mind, the left I speak of is not a center left party. These are marxists. Some describe themselves as Leninists, others Stalinists. Aside from their economic beliefs, they have the typical small country inferiority complex and want to "stick it to the man" i.e. major (western) world powers. These extreme leftists have never had power before, and this is their first time.

They're making a mess of things, as I had predicted. Between their amateurism, incompetence, unworkable economic theories, and poor skills at diplomacy, they are a disaster in the making. Keep in mind also, that SYRIZA is a hodgepodge of radicals that often disagree with each other, some more extreme than others. I just don't see how this government can agree on anything. Winning elections in a country experiencing a depression is one thing. Governing is entirely another matter.

I don't see SYRIZA having a future. By years end definitely, but more likely sooner they will lose an election.

Aside from the feel good rhetoric designed to appeal to the lowest common denominator, do you know what they have accomplished?

Pre election, most Germans wanted Greece to stay in the EU. Now, over 50% want Greece out. How is that supposed to make Merkel or Schauble's job easier? By alienating the German voter, they put Merkel in a difficult position.

Kammenos, the leader of the far right Independent Greeks party formed a coalition with SYRIZA. He has stated twice that if Greece were bullied Greece would allow anyone from the Middle East (jihadists he was referencing) papers so they could travel to Germany, for example. Funny thing is, just recently the Greek government prepared papers for Syrian refugees to give them citizenship and free passage to any EU country. As soon as one of these SYRIZA idiots (for lack of a better word) realized that they were in violation of the Schengen treaty, the treaty that allows free travel by EU citizens, they immediately backtracked and issued papers revoking the rights they had just given the Syrian refugees. I'm telling you, it was a complete Keystone Cops moment. A major blunder. And now, I'm guessing due to Kammenos' comments, there is a significant increase in Syrian refugees coming to Greece.

What else have they done? They want to give criminals with disabilities the opportunity to serve out their sentences under house arrest. November 17 is a terrorist group in Greece, guilty of killing Americans among others. One such member of that terrorist group will likely be given the house arrest option. This has caused a major rift between Greece, and the only major power that has pressured Germany to be lenient with Greece - the USA. Again, it's Marxist "sticking it to the man" mentality - without any afterthought of the consequences. The US has issued a statement considering this a "profoundly unfriendly act." For a so called advanced western nation, quite an accomplishment by this government! I'm both embarrassed and angered by this government's plan to give house arrest to a terrorist, as are many Greeks.

What else? To earn the votes of the youth, they want to change the higher educational system. Students will vote for their dean at Universities, they can study for as many years as they want, entrance grades will be lowered, in the event of a protest, the police can not enter University buildings, etc... How's that for making Greek youth competitive? Basically, this policy will encourage the best and brightest to leave Greece.

There is much, much more. It pains me to see the likes of Krugman or Galbraith using Greece as an example for their economic theories, or outright supporting the current government. They need to do their research and understand what is really going on. Otherwise, their reputations can suffer.

I don't think the next government after SYRIZA will get the blame. The economic situation had stabilized before the recent election and now it is getting worse again. It will be easy to put the blame on SYRIZA. And I wouldn't be surprised if the EU gives the next, more cooperative Greek government some leeway.

I'm sure many hard leftists in Greece will blame the EU for their downfall. But their disaster was their own making. Fortunately the hard right, mostly Golden Dawn-the neo nazi party, has lost numbers. Eventually, I see Greece having moderates - both left wing and right wing, in power again.

Pre crisis, Greece had a two party system. The moderate left PASOK, which seems to be slowly fading, and the center-right New Democracy. Both of these parties were guilty of rampant corruption during the bubble. As a result, both have lost to the more extreme right and left parties. New Democracy, however, is still a viable party, and the main opposition right now.

[thriftyandboringinohio]

Re: Galbraith on Greece

Thanks for the thoughtful reply, gnk.

[thriftyandboringinohio]

Re: Galbraith on Greece

Hum...Bernanke?

Touche`
One could argue it applies to Bernanke twice -once coming in as the new fool and once handing off even worse problems to the next.

[don]

Re: Galbraith on Greece

Touche`
One could argue it applies to Bernanke twice -once coming in as the new fool and once handing off even worse problems to the next.

Don't let the revolving door hit you in the ass, Mr. Chairman . . . .

[santafe2]

Re: Galbraith on Greece

One could argue it applies to Bernanke twice -once coming in as the new fool and once handing off even worse problems to the next.

We'll have to see how well Bernanke can wear the "who knew" suit if there's a major crisis in the next 18 months. When he left, (and even today), the contagion is not well identified. When Greenspan left I doubt there was one person on iTulip that didn't understand he was locking the front door after he'd set the house on fire.

[don]

Hudson on Greece

The Reoccurring Financial Woes of Greece

by MICHAEL HUDSON and SHARMINI PERIES

SHARMINI PERIES, EXEC. PRODUCER, TRNN: The Euro is slipping against the dollar, and the European financial markets are in flux, expecting Greece to fail on its 1.6 billion Euro repayment due to the International Monetary Fund on the 5th of June. Joining me now to discuss Greece and the financial [wars] it’s posing to the European markets is Michael Hudson. Michael is joining us from New York, and as you know he’s a distinguished research professor of economics at the University of Missouri, Kansas City. His two newest books are The Bubble and Beyond, and Finance Capitalism and Its Discontents. His upcoming book from CounterPunch Books is titled Killing the Host: How Financial Parasites and Debt Bondage Destroyed the Global Economy.

Michael, what is the response of the European financial markets to Greece?

MICHAEL HUDSON: The financial markets have the same response that they had over five years ago. All of the problems today came up in 2010 when it was obvious that even at that time Greece could not pay its debts. The International Monetary Fund had its economists make a series of projections to analyze its ability to pay. What happened a few years earlier was that a Wall Street bank, Goldman Sachs, helped the Greek Central Bank conceal the amount of debt that it owed. When Pasok, the ostensibly socialist party, came to power, Papandreou revealed how much money Greece actually owed to its bondholders. And the IMF said wait a minute, the bondholders have lent much too much money for Greece. We’ve got to write down its debts to the ability to pay. There’s no way that Greece can pay the debts without imposing an economic collapse and making it even harder to pay the debts.

So there was a big series of meetings, one in 2010 and then a Group of Eight meeting in 2012. Basically, the European Central Bank and the European Union told the IMF that there’s nothing in the laws that they had written up in Europe to write down debts owed to the Central Bank. They said, in effect: “If you, the IMF, want to be a part of all of this debt restructuring, we want to pay off all the private bond holders so that they don’t lose money. We want to let the speculators gain because that’s our constituency.” But the IMF economists pressured the head of the IMF at that time, Dominique Strauss-Kahn, to write down Greece’s debt.

The problem is that Strauss-Kahn wanted the IMF to be a player in the European Central Bank and the European Union, the main financial interests. He also wanted to run for the presidency of France, and most of Greece’s debts were owed to French banks. So Strauss-Kahn had to essentially operate in the interest of France, and his own political fortunes rather than what IMF economists recommended. Basically, he agreed to have the Central Bank and IMF lend Greece enough money to pay the bondholders.

It turned out that the IMF economists were quite right, and Greece couldn’t pay. The result is that the leading economists in the IMF’s European division resigned in anger. They’ve written a series of reports. They talked to reporters and said look, the IMF is thoroughly corrupt. It’s captured by the bondholders. Its ability-to-pay models are junk economics. That left basically the only people remaining in the IMF as bank lobbyists. The IMF leadership saw the Greek crisis and the other European debt crises as finally a chance to get the IMF back as a world player. So basically they made a huge refinancing of Greek debt in 2012.

The terms were highly creditor-oriented. Instead of Greeks owing money in their own currency, they would owe it in a currency they couldn’t create, the Euro, and they’d owe this money not to private bondholders, to whom it’s easy to write down debts because private bond holders are willing to renegotiate as already we saw them do in Argentina. But you can’t renegotiate with the European Central Bank.

So now we can fast-forward to earlier this year when Syriza came to power in Greece. The European Central Bank said, we central banks may be independent from government, but we’re not independent from the financial interests. We’re not independent from Wall Street. As a matter of fact, Tim Geithner and Obama, in 2012, went to the G8 meeting and said Europe, you have to bail out the Greek private bond holders, because the American banks have made huge guarantees on credit default swaps, and we’ll go broke if we have to pay and made the wrong bet. So you have to save Wall Street and screw Greece. Naturally, Greece got screwed. Well, at the autumn 2012 meetings the IMF people spilled the beans about how Greece has been left in debt.

When the elections happened this January and February, the Central Bank came right out and said to the Greek people, don’t vote for Syriza. If you vote for a party that is opposing writing down the pensions, if you elect a party that’s supporting the working class, if you vote for a real socialist party that wants to stop the sell-offs, then we’re going to treat you with sanctions very much like what America treated Cuba or America treated Iraq.

What we’ve seen erupting in Europe in the last three months is the old class war. But it’s not really the old class war. It’s the war of finance against not only the Greek pensioners, not only the Greek economy, but Greek industry, Greek exporters and Greek banks. There’s a war to treat Greece as an object lesson, because the financial interests of Europe worry that if the Syriza party is able to write down the debts to save the economy from depression, then Podemos in Spain and the Portuguese popular parties are going to write down their debts. We’ve got to make an object lesson of Greece. We’ve got to absolutely crush socialism in the cradle so that it won’t grow into a European-wide movement to avoid depression.

When Syriza came to power, the belief by the negotiators, Yanis Varoufakis and his colleagues, was that well, we can be reasonable with Europe. We can say, “Look, there’s no money to pay. We can’t cut back pensions more, because they’ve already been cut back, and we’d be voted out of power just like the old party. We’re not willing to privatize the Greek economy and sell it off to foreigners just because bondholders made a bad bet and the European government has made a bad bet.”

But the European Central Bank is saying, “You have to cut your wages even lower. You have to make even more unemployment–30 percent unemployment isn’t enough, 50 percent unemployment in new graduates isn’t enough. You only have ten percent of your population emigrating. You have to have more of your population emigrate.”

Naturally, Varoufakis and the Syriza party say that this is crazy. It’s junk economics. “We’re not going to commit suicide, and no national government has to commit financial and economic suicide simply to pay bondholders.” That’s what it means to be a sovereign government. But then the Europeans say, “Ah, but you’re not a sovereign government. Because a sovereign government, according to the textbooks, has the right to print its own money. But you don’t have the right to print your own money. Only we, the Central Bank, have the right to print money, and we’re not going to do it. We’re not going to print the money to help your economy because we don’t like your political party. You didn’t vote for the right party.”

That’s basically what Angela Merkel told them five years ago, that’s what other European representatives of the financial interests have told them. So essentially the Greeks are told either you vote in a right-wing party or we’re going to make you wish that you did.
That’s the politics, now. Everyone’s trying to figure out, what on earth can the Greeks do? Either there’s total surrender, which is being demanded by the European Central Bank of Syriza; or, Greece says it won’t pay. And if it doesn’t pay, then it really doesn’t have a problem anymore.

The arguments that are being used are exactly the same that were used 90 years ago in the German reparations debate. The Greek government is told to pay the bond holders, meaning the European Central Bank and the IMF, essentially by increasing taxes. But if you increase taxes, you shrink the market. There will be even more unemployment and even more emigration. And the Greeks – and any economist who’s studied economic history – knows that this is suicide.

So we’re in a condition where the European Central Banks are basically making a demand that no country could meet. They are trying to force a crisis, and nobody can see any way out of it.

PERIES: It appears that if rumor is correct, the murmurs coming out of Europe is that there will be no resolve by Thursday, which was a deadline to come to some agreement, as June 5th is the deadline for the first repayment to the IMF. If Greece doesn’t come to an agreement in terms of its repayment it will obviously be in default. What options does Greece have?

HUDSON: Well, this is not just a rumor. Varoufakis has written in the last few days that there is no way that Greece is going to stop paying pensions, and there is no way that Greece is going to privatize the economy. He said, we’re willing to make all sorts of compromises. The usual, it’s called extend and pretend, you lend us the money and we’ll pay you. You pretend to lend us the money, that it’s a good debt, we’ll pretend to pay. But there’s no way that they’re going to commit suicide. And the Central Bank’s saying, “Yes, you have to commit suicide or else have the anarchy of withdrawing from the Euro. What are you going to do?”

So they’re trying to figure that out. “We’re not going to be able to pay, so what is the point of trying to pay a debt that can’t be paid? If there’s no money there we can’t pay, so there’s no way that we can meet their conditions.”

There’s obviously going to be a break. Greece is going to use its money to continue to pay pensions. It’s not going to privatize more of the public domain, it’s not going to sell off its mineral holdings and its gas rights in the Aegean.

Apparently President Obama, who originally had told Europe, wait a minute, you’ve got to stop Greece from withdrawing because otherwise it’ll have to make a deal with Russia for gas. It’s going to be anarchy. And that’s the intended result by Europe. I know the Greek negotiators. I’ve spoken to them. I could not do anywhere near as good a job as they’re doing. I’m in full agreement with everything they’re doing. They’re being reasonable. But they’re up against a wall – the intention to have economic warfare and force Greece to continue the privatization program and to continue the war against labor.

There’s no way of knowing what’s going to come out. Some kind of script currency, some kind of artificial currency maybe used as an interim. But that’s only an interim transition.

PERIES: Why is it beneficial for the European banks and European financial might to allow Greece to default in this way? After all, this might also be another example for the other countries, you mentioned, to default as well, and leave the Euro and establish their own currencies. And at the end of the day, beneficial for them to do that.

HUDSON: You’re right in pointing out that the issue really isn’t Greece itself. Greece’s debt is only about 2 percent of the overall European debt. So in itself, it’s not in the interest to create a break. And if economic rationality were all that there was, of course the Central Bank and IMF would write down the debt. The IMF says, “We’re not going to lend Greece any money, we’re going to stop the pretense, unless the European Central Bank writes down the debt.” And the European Central Bank says, “We’re not going to.”

But the point is precisely what you just raised. Italy, Spain, Portugal, and other countries. They want to make an example, saying if any of you countries have the idea that you’re going to put your own workers, your own economy first before the creditors, then we’re going to treat you like we’re treating Greece. We’re going to make Greece an object lesson, just as America made Iraq and Iran an object lesson and made Cuba an object lesson. They think that somehow they can demonstrate that Greece is going to suffer. But Greece has pretty smart leaders, and the object lesson may backfire.

That’s what class war is. The oppressed group always is in a weaker position, but very often it’s able to recover. That’s what’s at issue right now, who’s going to win: The left wing, or the right wing?

This an edited transcript of an interview on The Real News Network in Baltimore.

Sharmini Peries is executive producer of The Real News Network.

Michael Hudson’s book summarizing his economic theories, “The Bubble and Beyond,” is now available in a new edition with two bonus chapters on Amazon. His latest book is Finance Capitalism and Its Discontents.

[gnk]

Re: Hudson on Greece

"But Greece has pretty smart leaders, and the object lesson may backfire."

I find this quote from Michael Hudson to be hilarious. 30-40% of Syriza want a break from the EU. With those numbers, I find it hard to believe that a new agreement can be passed. This extreme left element of Syriza actually envy Venezuela. Every day here in Greece, one minister contradicts another. They backtrack constantly. They have been lying about being close to an agreement to slow down the current and ongoing bank run. You want to see their intelligence? Learn Greek and watch a session of Parliament. Hollywood couldn't make up what goes on in Greece's Parliament.

Does Michael Hudson know that unmarried daughters of civil servants receive their parent's pension, for life, when that parent, that was a government employee, dies? I guess it's because of her unmarried condition - no husband to support her - I wonder what feminists think of that. And that law was passed before the crisis. That is just one example of many of Greece's dysfunctionality. More on Greece's current pension status here. Short summary: its unsustainable.

What Keynesians and MMT'ers don't get is that if the car's engine is poorly designed, no amount of gasoline is going to fix it.

Greece's debt load is high, yes, but few analysts examine the servicing of that debt as a percentage of gdp. Greece actually has essentially low or no interest loan(s). Furthermore, Greece is incapable of self reform - too many ensconced interests from all walks of life. The EU has done more for Greece in terms of reforms than any other Greek government has done before the crisis.

And what has the current government accomplished in its first 100 days in terms of reforms/bureaucracy/red tape, corruption, government waste, etc...?

Nothing. Why? They don't need to so long as they can blame outsiders for Greece's current ills.

I used to follow up on both Galbraith and Hudson when I lived in the US, especially during the AFC. Now that I live in Greece, I see them as either analysts that have not done their homework, or left wing hacks spinning a yarn.

Compare Hudson and Galbraith's views with this Michael Lewis article: Beware of Greeks Bearing Bonds That's the real Greece, and it still has a long way to go. As of today, Greece is still incapable of going it alone. Should Greece leave the Euro, the Troika days will seem like the good ole days.

Without the EU's help, Greece will go back to these days (excerpts from the Oct 2010 M Lewis article):

The scale of Greek tax cheating was at least as incredible as its scope: an estimated two-thirds of Greek doctors reported incomes under 12,000 euros a year—which meant, because incomes below that amount weren’t taxable, that even plastic surgeons making millions a year paid no tax at all. The problem wasn’t the law—there was a law on the books that made it a jailable offense to cheat the government out of more than 150,000 euros—but its enforcement. “If the law was enforced,” the tax collector said, “every doctor in Greece would be in jail.” ...

“Our people went in and couldn’t believe what they found,” a senior I.M.F. official told me, not long after he’d returned from the I.M.F.’s first Greek mission. “The way they were keeping track of their finances—they knew how much they had agreed to spend, but no one was keeping track of what he had actually spent. It wasn’t even what you would call an emerging economy. It was a Third World country.”...

In just the past decade the wage bill of the Greek public sector has doubled, in real terms—and that number doesn’t take into account the bribes collected by public officials. The average government job pays almost three times the average private-sector job. The national railroad has annual revenues of 100 million euros against an annual wage bill of 400 million, plus 300 million euros in other expenses. The average state railroad employee earns 65,000 euros a year. Twenty years ago a successful businessman turned minister of finance named Stefanos Manos pointed out that it would be cheaper to put all Greece’s rail passengers into taxicabs: it’s still true...

The Greek public-school system is the site of breathtaking inefficiency: one of the lowest-ranked systems in Europe, it nonetheless employs four times as many teachers per pupil as the highest-ranked, Finland’s. Greeks who send their children to public schools simply assume that they will need to hire private tutors to make sure they actually learn something...

There are three government-owned defense companies: together they have billions of euros in debts, and mounting losses. The retirement age for Greek jobs classified as “arduous” is as early as 55 for men and 50 for women. As this is also the moment when the state begins to shovel out generous pensions, more than 600 Greek professions somehow managed to get themselves classified as arduous: hairdressers, radio announcers, waiters, musicians, and on and on and on. The Greek public health-care system spends far more on supplies than the European average—and it is not uncommon, several Greeks tell me, to see nurses and doctors leaving the job with their arms filled with paper towels and diapers and whatever else they can plunder from the supply closets.

This is why Greece finds itself in the position it is in today. It has nothing to do with the "evil" EU or ECB. As for Syriza, one could say that they were not in power during those wild west days. That's true. But if anyone looks at their platform, they want to go right back to those days. They want a massive government full of employed voters that will ensure them guaranteed offices in government. But being Marxists, they haven't figured out how to pay for it yet.

There is a common joke here in Greece. Left wing politicians dipping into right wing pockets.

[Thailandnotes]

Re: Hudson on Greece

Michael Lewis on Greece. May 2015...

http://www.bloombergview.com/article...s-the-autobahn

[gnk]

Re: Hudson on Greece

Michael Lewis on Greece. May 2015...

http://www.bloombergview.com/article...s-the-autobahn

Very good article, thanks for posting. I agree with Lewis 100%.

[GRG55]

Re: Hudson on Greece

Very good article, thanks for posting. I agree with Lewis 100%.

And I of course do not.

The Greeks screwed themselves by taking candy from a stranger (the Euro subsidies and debt after they joined the currency union).

Once it became a Euro diabetic nation, instead of offering the Greeks dietary counselling, metformin or insulin the EU, with the able assistance of the IMF and its ludicrous economic growth and fiscal surplus forecasts, offered more candy.

And the allegedly "more responsible than the current" Greek government of the day took it.

gnk's observations of what is happening at the front lines are astute and valuable. But perhaps we need to zoom out to a much, much longer focal length to assess how this might play out.

What are the consequences of Greece not playing ball? Enormous unemployment? Inability to repay sovereign debts? Curtailment of public services? No new loans?

What have been the consequences of Greece playing ball...

[gnk]

Re: Hudson on Greece

GRG55, it is very difficult to understand or appreciate the impact Greek psychology has on the economy and government. Michael Lewis has captured it with his metaphor. I'm not surprised, as he has done a lot of "in the trenches" research here.

It is not an EU problem, it is a Greek problem spanning two centuries. I can write volumes on it. Its no coincidence that Greece has been in some sort of financial distress for half its almost two hundred year history as a modern state.

In this more recent two decade old episode of financial mismanagement, the Greeks had to take the EU candy to cover up decades old drachma mismanagement post Junta.

Greece has been broken for a very long time. I know this may sound un-PC, but some countries just are not capable of self rule. I say this as a Greek-American.

If you look at my old posts when I first moved here in 2010, I had a very different view. I even called Germany the Fourth Reich! Living here for five years changed that. I have grown to respect Germany more.

I can say this living here - last year there was a palpable stabilization. Bank deposits, 10 yr govt bonds, investments, were all growing or at least stopped falling. Most payments at the language school I work were being made on time. And then the political uncertainty in late 2014 that led to January elections. And here we are. It is typically Greek.

You know the quote: “The United States can always be relied upon to do the right thing — having first exhausted all possible alternatives.”

Well here in Greece, due to the self righteousness/victim mentality against the foreign power du jour, they rarely get it right. It always affects their judgement. Politicians or rather demagogues, use the foreign power interference meme with excellent results for their careers, poor results for Greece.

Internally, this is also affecting Greece: the social contract between the public and the private sector is broken. The government, for decades, has taken to giving out jobs and money for votes, and the private sector has taken to tax evasion as protest (with an element of greed too). That oligarch thing is not as relevant as the media and politicians suggest it is. The problem is grass roots level. It is endemic from the government employee to the souvlaki restaurant and up.

But I'll say this as well - Greek society is extremely resilient. Few countries could suffer Greece's current economic situation and still maintain (relatively speaking) low crime rates, suicide rates, etc...

Here's a story a friend once told me that happened years ago:

A low level worker at the local tax office told my friend that his business was guilty of tax evasion and asked for a payola to make things "go away." Well, my friend knew this was a shakedown so he told the police, and a sting operation was implemented. There was a microphone, and the police were undercover near the meeting. The operation was a success. That government employee was suspended without pay. However, the court system is so dysfunctional that it took years for the case to go to trial. The attorney for the accused used civil procedure rules to drag the case on (and I wouldn't be surprised if some payola was used to keep the case in the bottom of the docket pile.) Anyway, the statute of limitations expired, and the accused, no longer under prosecution, was given her government salary back for those years she was suspended.

Now tell me. Where does "evil" Germany, the EU, or the "Imperial" USA fit in that story?

The consequence of Greece "playing ball" is hopefully, a nation that has been "rebuilt." Because obviously, it can not do it on its own. And remember, yes the debt is huge, but the payments, as a percentage of gdp, not so much. This debt is a necessary sword of damocles, being held over Greece, to reform an otherwise self-unreformable country.

What we are seeing here is nation-building. I know, it is rarely successful, but here in Greece, I think it is worth it.

[Southernguy]

Re: Hudson on Greece

Now tell me. Where does "evil" Germany, the EU, or the "Imperial" USA fit in that story?

During all these years the EU, the USA and the whole lot kept lending money to Greece. Didn't they know what was going on? The IMF, the CIA, the....you name it weren't able to find out?
How much of these loans went into Greeks (working class Greeks) hands? How much was captured by affluent Greeks? Most important: how much went into military hardware which was bought mainly from Germany France or the USA?
What were the parties governing Greece at the time?
Did the foreign powers have something to say about the disfunctionalities you describe?
Your information tends to be anecdotical. Anecdotes are useful to grasp some realities...only up to some point. But you won't understand the whole picture only from anecdotes.
When Greece came into the EU and after into the EZ it was (supposedly) the object of a thorough examination from supposedly very competent economic intelligence organizations. They were embedded in the government.
If I lend money to a poor, ignorant and irresponsible fellow I am more responsible than him of the natural consequences. This mess is about a Greek ruling class which colluded with an international ruling class to economically and politically destroy a noble people.
Probably it is the price extolled on them for trying to build a socialist society after WWII and, particularly for their armed resistance against the British. Which was, of course, crushed using the same Nazi procedures and the same Nazi armed bands.

[don]

Re: Hudson on Greece

Someone needs to read "Confessions of an International Hitman" methinks . . . .

[LazyBoy]

Re: Hudson on Greece

*Economic Hitman?