The Greeks are getting closer to reality
Date posted: August 9, 2015
For five years now everyone in the eurozone is avoiding to see the reality about Greece. The reality is that Greece has defaulted; the economic consequences are those of a default. Companies are shutting down, high unemployment, poverty, young people leaving the country, as also increase of suicides. However, Greece hasn’t declared bankruptcy and that because our “partners” have come up with ideas to keep us in the eurozone. Not to let Greece get back to growth, but just to keep us in the eurozone for their own reasons. This didn’t let Greece to “enjoy” some prerogatives that a defaulted country can have. First a massive reduce its debt, and second a devaluation of its currency in order to strengthen the country’s exports helping recovering.
In this denial, the Greek people played an important role. Undoubtedly, in the past 10 years before the Greek crisis, the Greek people enjoyed getting new apartments, luxury cars, and vacations like they never dreamed of. All those with “easy to get” loans from the banks. The first years of the euro gave to the Greek banks access to cheap money, which then they were selling in a loan form with high interest. The banks never really cared if the borrower can repay the loan, they just wanted to have as many borrowers as they could who they will be able to pay the minimum amount. I experienced many cases where the bank was offering a 3.000euros loan to someone who was making just 500euros per year! There were managers of bank branches saying “whoever gets in, he leaves with something”. Meaning, that any potential client needs to get something from the bank, a credit card, a loan, anything.
At the same time, the Greek exports were getting more expensive. Greece is not a country who produce cars, or high technology products in order to be benefit by the expensive and tough euro. The main sources of income for Greece is the agricultural sector and tourism. Both sectors started to lose money because of the expensive euro. Many international buyers of agricultural products started to prefer products from countries like Algeria or Turkey. Their products were much cheaper because of their softer currency. However, the Greek producers didn’t really care as they were enjoying their new BMWs or Mercedes.
The rest is already known, the Greek crisis started in 2010 and the “institutions” came to Greece in order to fix our economy. However after 5 years following their program, Greece is in a worse place than 2010. The country’s debt has been exploded to 180%, the unemployment has reached to numbers seen for the first time and, in general, the Greek economy looks like a swap.
Under these circumstances, the Greek people started to realize what happened to the country. They started seeing the mistakes of the past, but at the same time they are starting to understand that today’s situation cannot go further. The first act which shows that the Greek people are moving to a different direction was the referendum couple of weeks ago. In a massive way, the Greeks said “No” to the bailout terms. However, the Greek government accepted these terms. Last week a very interesting research became known. A poll which was conducted by the think tank “Bridging Europe” shows that the percentage of the people preferring to leave the eurozone has increased to 36%. Only 41% is in favor of the euro. Those numbers are not something new. If we take a closer look we will see those numbers matching the numbers of the referendum. The “Yes” party got 39% in the referendum, very close to the 41% of those who still prefer the euro in the “Bridging Europe” poll. The “No” party got 61% and if we add the 23% in the poll which answers as “I don’t know/don’t want to answer” to the 36% of those who are in favor of leaving the eurozone, we are reaching to 59%.
One thing is sure, in the next months more people will lean to the side of those who wants to leave the eurozone. It will not be a political decision by them. It will be the cruel reality of the eurozone. Greece doesn’t have any future inside this monetary union. We are not denying the mistakes of the past, but at the same time we must stop denying the reality.
Just an example to show you why more people will prefer leaving the eurozone. One of the last demands by the creditor is that if someone who lost his job and is unemployed, but has a car or a house will need to pay 26% more in taxes. With ideas like this one then the Greeks eventually will say “Goodbye Juncker”.
You can view the entire poll research of the think tank “Bridging Europe” by clicking here or copying and pasting the below address: