Greek Tragedy ( Capitalism in crisis....again! )

[reverendjeremiah]

Modern Capitalism (the Americanized version) = Privatise the profits and socialise the losses.

---

If Greece were a capitalist nation the debt incurred would have been allocated via market signals, such as supply and demand, productivity, profit and price to industries which could have used the debt to invest in infrastructure that would create more wealth than it took in - That is quite plainly not what happened in Greece.

Right, because cut throat capitalism, the same kind of capitalism that libertarians push, would actually care about the victims? That those who seek profit only for the sake of profit would actually turn the debt around into infrastructure instead of cooking the books, grabbing the cash and running? Greece very much is a capitalist system. In fact they are a mixed economy. What is it about Libertarians that they think that if they loosen the restraints on the market that suddenly everything will become benevolent and self efficient?

[theVOID]

theVoid, we agree on one thing then, the Greek people are not responsible for the country's problems.

Do you then support their opposition to the second round of austerity measures?

The question for the Greeks is "Is it better than defaulting?", if that's the case they might as well go for it, if not then they should default, I don't have much of an opinion on what option is ultimately better but I'm leaning towards Defaulting as being their best option.

Unluckily for them they are very much an import economy, they don't have near the infrastructure to support the lifestyle they want by themselves (hence the debt problem) so they need trade opportunities with other nations. Being unable to produce and export goods enough to sustain their debts and being too far to in debt and too poorly rated to easily acquire any form of credit they are forced with that choice.

Am I ignorant of capitalism? Well I've been a socialist for almost 40 years so I like to think not.

Yet you have failed to bring to attention in this conversation any real reasoning what-so-ever to support the conclusion that it's the fault of capitalism. The situation in Greece is one of an import economy with a large trade deficit, huge debts and a sizeable welfare system that borrowed too much money to support a system that was simply unable to make use of the investments in a way sufficient for them to generate the wealth needed to sustain their lifestyle, it is now dealing with a large, fairly socialist and authoritarian EU to secure bailouts which essentially amounts to the burden being shifted to other member nations in the EU - Everyone else will be made to pay for the bunk Greek system - Compared to the role their involvement with the American banking giants had who triggered the collapse which is genuinely more of the 'straw that broke the camel's back' than anything in this situation, the situation involving the Greek State and the EU is much more significant and clearly not capitalism - Your statements to the contrary are either rather disingenuous or ignorant.

I can see how global capitalism isn't doing much for world peace, the third world or wage slaves around the globe , whilst ensuring an ever-widening gap between the richest and poorest.

That's a separate issue, we're discussing Greek.

Capitalism has everything to do with the EU and Greece, in this instance, since any help that country gets will be based on financial terms that will hurt those already suffering while the richest will continue to escape the worst of the austerity measures.

Define capitalism for me, then explain why you think the EU situation has anything to do with it. Yeah, it's going to suck for Greece, but that's not an argument for it being the fault of capitalism at all, it's just an observation of what choices they face given their situation, none of them are good giving the circumstances surrounding the nature of the Greek economy.

---

Right, because cut throat capitalism, the same kind of capitalism that libertarians push, would actually care about the victims? That those who seek profit only for the sake of profit would actually turn the debt around into infrastructure instead of cooking the books, grabbing the cash and running? Greece very much is a capitalist system. In fact they are a mixed economy. What is it about Libertarians that they think that if they loosen the restraints on the market that suddenly everything will become benevolent and self efficient?

We are discussing Greece here, not political or economic ideology. If you think that capitalism was to blame for the Greek situation then give your reasoning, explain why it was a more significant factor than the out of control public debt, rapidly rising costs of welfare systems, ageing population and retirement at 52 on an 80% salary, lack of investment in the productive sector to create wealth and lifestyles that tended to be more demanding of goods and services than they could provide for themselves. Or better yet, explain how you see Capitalism being to blame for a situation where they are not being productive or profitable and didn't sufficiently use capital investment to extent their wealth, the banks created a situation where they are now owed tens of billions of dollars and will likely not recover it all (and have a fairly decent chance of receiving none) given they exist to seek profit.

[reverendjeremiah]

We are discussing Greece here, not political or economic ideology.

Thats what I thought as well..and that is what I had in mind for the context of my post

If you think that capitalism was to blame for the Greek situation then give your reasoning, explain why it was a more significant factor than the out of control public debt, rapidly rising costs of welfare systems, ageing population and retirement at 52 on an 80% salary, lack of investment in the productive sector to create wealth and lifestyles that tended to be more demanding of goods and services than they could provide for themselves. Or better yet, explain how you see Capitalism being to blame for a situation where they are not being productive or profitable and didn't sufficiently use capital investment to extent their wealth, the banks created a situation where they are now owed tens of billions of dollars and will likely not recover it all (and have a fairly decent chance of receiving none) given they exist to seek profit.

I never suggested that Capitalism was to blame for the Greek situation. I specifically said "Modern Capitalism", and to ensure that people did not misunderstand me, I defined "Modern Capitalism" as "Privatise the profits, socialise the losses." I personally see no problem with the age being set at 52 on an 80% rate. The big problem in this situation is that the "modern capitalists" (please refer to my original definition for it again) are currently in control of Greece and have managed to push, as of 2010, the corporate tax rate down one percentage point each year until it drops from 25% to 20% in 2015. As long as this is in effect, the Social Security system will only get worse. Why did you not know this? Let us look at the current exchange rate of Dollar versus Euro:
http://www.google.com/search?q=euro+vers...ess&ie=&oe=

Now lets look at the income tax rate of the supposedly "progressive tax system" they have in Greece:

The employer deducts tax from the employee and transfers it to the tax authority every month. Income tax brackets in Greece for the year 2008 are 0% (up to 12,000 euros), 27% (from 12,001 to 30,000 euros), 37% (from 30,001 to 75,000 euros) and 40% (above 75,000 euros). For tax year 2009 the respective rates will be 0%, 25%, 35% and 40%.

The cut off at 40% starts too low and contains everything higher than that low number. 75,000 Euros is rounded equivalent to $100,000 USD. Now look at the next lowest bracket. This is the bracket of pay where the middle class / skilled workers tend to fall under. This braket is taxed at 3% less than the upper bracket. 3% difference?!?!?! This makes the mass of consumers (the middle class) under a much heavier burdon than the richest people of the country. I will remind you that the price of milk doesnt change regardless of wether you make 1$ an hour or $10,000 an hour. So naturally the only people who can AFFORD to invest is the rich becuase they have such larges sums of spendable income that is hardly taxed compared to the working class. Now we take this information and shine it under the light of the fact that there are tax excemptions in Greece as well.

Tax Exemptions
There are several cases of Tax exemptions under the Greek taxation system, these are as follows:
Proceeds from the sale of shares that are traded on the Athens Stock Exchange.
Income from ships and shipping.
A dividend received from a Greek company.
Capital gain from sale of a business between family members, as defined by law.

All of these tax exemptions are more likely to benefit the upper income earners, and not the actual workers of the country. So now you have very filthy rich Greeks not only dumping the burdon of funding the country on the backs of the workers, but they also do not have to pay taxes for sales of stocks, income from shipping (which is a major income source in Greece), dividends from company stocks, and capital gains from transfering wealth between family members.

Anyone with a basic understanding of economics can easily see that the "privatise profits, socialise losses" is very much in effect in Greece, and it will only get worse as these rich people, who already barely pay any taxes, will have the taxes of the corporations lowered from 25% to 20%.

The problem in Greece will only get worse as the years go by. Why? Because the same people who are screaming "taxing the rich will kill jobs" fail to point out that the tax rates on the rich HAVE been going down and there is a direct connection between the decline of jobs and the decline of tax rates for the rich.

You want to see jobs? Jack the tax rates up on the rich and then give them incentives of tax breaks for the creation of new jobs. As long as the rich get to keep huge sums of cash with no strings attached, then the profit motive of capital fails to keep the rich moving forward. Lets make sure the profit motive stays on the rich shoulders as well as the mid class.

[theVOID]

I never suggested that Capitalism was to blame for the Greek situation.

Glad you've clarified that, because leaping to defend a position that states so tends to give an impression to the contrary.

I specifically said "Modern Capitalism",

Ah right, the part where you're going to complain about Mercantilism but attach some pointless qualifier to capitalism and throw it in quotes the same way people use "Cronie Capitalism" when attacking Mercantilism...

and to ensure that people did not misunderstand me, I defined "Modern Capitalism" as "Privatise the profits, socialise the losses."

1. Capitalism prescribes no such thing as "socialise the losses", quite the contrary, it says that losses are a sign you're wasting resources and being inefficient, a warning that similar practices could lead to failure. Under a capitalist system there would be no rescuing of collapsed companies by the taxpayer - they would be sold to a competitor or entrepreneur who would re-tool the business and attempt to compete, the investors would recover the value of the sale and likely loose most of their investments, some employment will be lost for the short to mid term during the restructuring - If you're going to be talking about corporate-government bedfellows just call it what it is and don't attempt to sneak responsibility for it onto capitalism by adding a little qualifier like "modern", it's genuinely about as dubious as Glen Beck calling a moderate right wing government with a few more entitlement programs than he wants "Socialism".

2. This is hardly applicable to Greece in any case, there are no profits, there is no big winner that gets to pocket all the wealth, there are no investors being rescued by massive corporate packages - both the Greek and foreign investors are almost unanimously at a loss, the banks are unlikely to recover the majority of their loans and could even loose all of it, we have a failed state with huge debts and no ability to produce the goods and services necessary to pay back that debt, they are in a position where the only emergency loan they can attain is one that requires they sell state assets and make public sector cuts.

I personally see no problem with the age being set at 52 on an 80% rate.

Because you can't do math? It's patently unsustainable! And it's 58 sorry, 52 is partial retirement and 56 is the average on record.

Someone works from 18-56 on average (a lot of Greeks are in tertiary education but many also work from a younger age), 38 years, then lives to 78 (average Greek life expectancy) they have retired for 24 years relative to 38 of work. They have 38 years work to pay for 24 years retirement at 80% of their last wage. If the average person earned the equivalent of 400,000 Euros over their life, 10,526 per year, they get back 8,421 on average per year for 24 years, 202,104 Euro or 50% of what they've earned on average as an individual - And this is assuming everyone works, it doesn't take into account any beneficiaries which only make the numbers more staggering.

The big problem in this situation is that the "modern capitalists" (please refer to my original definition for it again) are currently in control of Greece and have managed to push, as of 2010, the corporate tax rate down one percentage point each year until it drops from 25% to 20% in 2015. As long as this is in effect, the Social Security system will only get worse. Why did you not know this?

You're assuming that Social Security in Greece is funded via the corporate income tax, this is false, Greece has contributions from the employer and employee, 28% of the wages value compared to 16% from the employee, 6% shy of the average needed to sustain the scheme with the generous figures above, and it's expected to cover unemployment and health insurance too! These payments by an employer are a transaction classed as an expense and are completely aside from income which is taxed after these contributions have been made - "Why did you not know this?" because you didn't look, you're of the mindset that every problem is somehow linked to business and taxes, if corporate tax is going down well look no further, that's gota be why Greece has a huge debt problem - You want to know why corporate tax is going down? Because they need people to invest in Greece but nobody in their right mind want's to, they have to make it attractive because they need the trade, industry, jobs and revenues.

Greece is nowhere near as pro business as you're suggesting either, considering this little left-wing nation with a 40% of GDP public sector is apparently being run by "modern capitalists" - For instance, Greece taxes 20% of the total value of any commercial entity when it is sold as a whole or upon larger acquisitions and mergers, that means if you want to sell a business the government takes 20% of it's value outright. Also, considering the profit is taxed, then dividends are taxed and salaries are taxed, an income tax rate of 20-25% alone is a rather dubious method painting the picture.

Let us look at the current exchange rate of Dollar versus Euro:
http://www.google.com/search?q=euro+vers...ess&ie=&oe=

Okay, but how about a source and not a picture?

http://quotes.ino.com/chart/index.html?s...l&a=50&w=1

Now lets look at the income tax rate of the supposedly "progressive tax system" they have in Greece:

The employer deducts tax from the employee and transfers it to the tax authority every month. Income tax brackets in Greece for the year 2008 are 0% (up to 12,000 euros), 27% (from 12,001 to 30,000 euros), 37% (from 30,001 to 75,000 euros) and 40% (above 75,000 euros). For tax year 2009 the respective rates will be 0%, 25%, 35% and 40%.

Isn't that funny, you're figures leave off the top tax bracket, even for 2008, and they're not quite the recent figures are they?

Tax % The Tax Base (EURO)
0 1-12,000
18 12,001-16,000
24 16,001-22,000
26 22,001-26,000
32 26,001-32,000
36 32,001-40,000
38 40,001-60,000
40 60,001-100,000
45 100,001 and over

http://www.worldwide-tax.com/greece/greece_tax.asp

The cut off at 40% starts too low and contains everything higher than that low number.

45% for 100,001 and over. It's a fairly normal bracket, it's the same as Australia and higher than here in New Zealand, and their corporate tax rate is only 3% lower than ours and 5% lower than Aus, so to imply that these factors are a cause of the problems without considering the fundamentals of the economies is absurd, I assure you that is where Greece's problems lie and that is why the situation is fundamentally different from other countries with similar taxes and revenues per capita.

Plus the VAT or GST in Greece is 23% compared to the 15% in New Zealand and 10% in Aus, that's a big revenue contribution, especially for the Greek tourism industry which is I believe their largest industry.

75,000 Euros is rounded equivalent to $100,000 USD.

That's about right for the year so far, it's been historically lower.

Now look at the next lowest bracket. This is the bracket of pay where the middle class / skilled workers tend to fall under.

That's not true, the average is in the 18% bracket, the average incomes in Greece are around 12,000 Euros/year or $17,000 US, they have lower take-home income but more benefits compared to most Euro nations with a higher share of the public sector being funded by businesses and high income earners, a more significant problem is their lack of employment relative to countries with similar incomes and tax revenues, a problem stemming from their pathetic productive sector and their utter lack of investment in it, which is only 21.6% of GDP, everything else is service sector and government spending. The huge difference is the amount they import, they have a staggering trade deficit.

This braket is taxed at 3% less than the upper bracket. 3% difference?!?!?! This makes the mass of consumers (the middle class) under a much heavier burdon than the richest people of the country.

Not in terms of percent it isn't, It's even less true given the numbers I cited, the Rich have more money but are taxed at a higher rate, that's the same everywhere essentially.

I will remind you that the price of milk doesnt change regardless of wether you make 1$ an hour or $10,000 an hour.

Red Herring, this has fuck all to do with their debt crisis, I can find you countries with lower wages, taxes and smaller debt problems easily, Greece is compared to the rest of the world in a group of moderate to high incomes.

So naturally the only people who can AFFORD to invest is the rich becuase they have such larges sums of spendable income that is hardly taxed compared to the working class. Now we take this information and shine it under the light of the fact that there are tax excemptions in Greece as well.

Which is a symptom of the countries mismanagement not the cause of the problems. They could afford to invest if they had any real measure of responsibility for their savings and retirement, this function was largely seized by their government as far as the middle and lower class is concerned and they absolutely fucked it up, they have a huge service sector because that's what you sell to people to win votes - Their investment in the productive sector is abysmal, that is why they cannot afford to manage their debts, they don't produce anywhere near as much as they consume and have to borrow to sustain the mess they've created.

Tax Exemptions
There are several cases of Tax exemptions under the Greek taxation system, these are as follows:
Proceeds from the sale of shares that are traded on the Athens Stock Exchange.
Income from ships and shipping.
A dividend received from a Greek company.
Capital gain from sale of a business between family members, as defined by law.

All of these tax exemptions are more likely to benefit the upper income earners, and not the actual workers of the country.

And stopping this would have prevented a debt crisis how? These are all measures to give Greece an advantage over foreign competitors and to make Greek businesses more attractive to investors both foreign and nationally, being an export economy no tariffs on imports lowers the cost of living for all consumers... you speak as if these would hurt their position... I hardly think so. Besides, how many dozen countries around the world are comparable with these conditions? I'm willing to bet it's a substantial number, these are relatively commonplace policies yet Greece is the one in a debt crisis, so they're clearly insubstantial.

So now you have very filthy rich Greeks not only dumping the burdon of funding the country on the backs of the workers, but they also do not have to pay taxes for sales of stocks, income from shipping (which is a major income source in Greece), dividends from company stocks, and capital gains from transfering wealth between family members.

*Yawn*

As I've said, Greece is comparable to a great many other nations in terms of taxes, income, policy and size who are not in a debt crisis, you are completely overlooking the fundamental problem with Greece, malinvestment, in an effort to blame the boogie men.

Anyone with a basic understanding of economics can easily see that the "privatise profits, socialise losses" is very much in effect in Greece, and it will only get worse as these rich people, who already barely pay any taxes, will have the taxes of the corporations lowered from 25% to 20%.

You haven't given one single example, let alone shown it to be anything like a significant factor in their situation, and yet you assert "Anyone with a basic understanding of economics can see that"...

Their problem is not enough producing, too much consuming, too much entitlement. They consume more than they produce in their country, they need to borrow to sustain that, they didn't bother to invest in production, it's not a difficult thing to grasp, yet all you've done is rave about tax rates which couldn't possibly account for the massive void in their trade deficit even if taxes were higher and you haven't so much as described one causal chain for any of it.

The problem in Greece will only get worse as the years go by. Why? Because the same people who are screaming "taxing the rich will kill jobs" fail to point out that the tax rates on the rich HAVE been going down and there is a direct connection between the decline of jobs and the decline of tax rates for the rich.

*Yawn*

You want to see jobs? Jack the tax rates up on the rich and then give them incentives of tax breaks for the creation of new jobs. As long as the rich get to keep huge sums of cash with no strings attached, then the profit motive of capital fails to keep the rich moving forward. Lets make sure the profit motive stays on the rich shoulders as well as the mid class.

Have you really failed to understand the specific situation in Greece to the extent where all you're going to do is spout rhetoric?

Simply put, there are examples of nations that are either side of Greece in terms of wages, taxes, size of the public sector, private sector, regulations and the like but the vast majority of them are in nowhere near the situation Greece is in, the fundamental difference in most cases is not the tax level or whether family members can sell each other businesses or whether corporate tax is 20% or 35%, it's their failure to support a productive sector significant enough to generate the wealth needed to sustain their standards of living.

[bozo]

the Void, you ask me to define capitalism and ask what it has to do with the EU and Greece.
The definition I favour is that capitalism is an economic system based on the idea of competition ( as opposed to the socialist idea of cooperation).
It flows that a competition throws up many more losers than winners. The evidence for this is the ever-increasing wealth divide between the mega-rich and the poorest countries and individuals on our planet. ( Socialism seeks to split the cake more evenly by removing the extremes ).
We live in a time when global capitalism is the dominant economic power ( not socialism ).
Thus the EU operates according to the prevailing orthodoxy. By labelling countries or the EU " left " you appear to be suggesting that socialist principles are at work...they are not, in my view. The medicine prescribed for the Greeks is of the capitalist type...toxic for the poorest.

As an example of capitalism at work, I point you away from Greece and towards Russia.
A recent report from Moscow's Higher School of Economics found that the richest have doubled their wealth in the past 20 years whereas almost 2/3rds are no better of and the poorest are barely 1/2 as wealthy as they were when comunism ended.
The report shows that oligarchs got rich quick by snapping up the country's choicest assets in the immediate post-Soviet period.
( my view, communism went to " gangster capitalism " very quickly indeed ).
The report further shows " two Russias " . The wealthiest 1/5 of the population received a pay cheque equivalent to 198% of its value in 1991, while the poorest 1/5 made only 55% in real terms.
In total, 60% of the population has the same real income or less than the average 20 years ago.

Same old story of capitalism at work!

[downbeatplumb]

Capitalism is only a good system for the 'haves' and actively traps the 'have nots' in poverty.
Thats cool with the haves because they have a pool of people they can exploit. That was until the minimum wage made them pay a reasonable amount and not slave wages.

[BethK]

Capitalizing the profits and socializing the losses is what Barry Ritholtz calls a "Bailout Nation" in his book, _Bailout Nation_ It is available at various bookstores. I got the copy I read from the public library. You can read about it at it's site http://bailoutnation.net/ "Bailout Nations" are neither capitalistic nor socialistic, but an absurd combination of the two. The concept of "too big to fail" figures in, so the extremely wealthy who own controlling interests in these "too big to fail" corporations get money to stay afloat, including paying their management huge salaries and even larger bonuses - "business as usual" for them - and the middle class and working poor fund these people and companies that have made bad decisions.

[reverendjeremiah]

Ah right, the part where you're going to complain about Mercantilism but attach some pointless qualifier to capitalism and throw it in quotes the same way people use "Cronie Capitalism" when attacking Mercantilism...

1. Capitalism prescribes no such thing as "socialise the losses", quite the contrary, it says that losses are a sign you're wasting resources and being inefficient, a warning that similar practices could lead to failure. Under a capitalist system there would be no rescuing of collapsed companies by the taxpayer - they would be sold to a competitor or entrepreneur who would re-tool the business and attempt to compete, the investors would recover the value of the sale .....

Here we go with the mercantilism thing again. Is it me or do only the Libertarians bring that word up anymore? You do realize this is the 21st century..not the 18th? So let me start this with a resounding "hell no I wasnt talking about mercantilism". I was very much describing Modern Capitalism. As far as you saying there are no profits in Greece, I find that to be the biggest dishonest and generalizing quote I have ever read from you.

Because you can't do math? It's patently unsustainable! And it's 58 sorry, 52 is partial retirement and 56 is the average on record.

Someone works from 18-56 on average (a lot of Greeks are in tertiary education but many also work from a younger age), 38 years, then lives to 78 (average Greek life expectancy) they have retired for 24 years relative to 38 of work. They have 38 years work to pay for 24 years retirement at 80% of their last wage. If the average person earned the equivalent of 400,000 Euros over their life, 10,526 per year, they get back 8,421 on average per year for 24 years, 202,104 Euro or 50% of what they've earned on average as an individual - And this is assuming everyone works, it doesn't take into account any beneficiaries which only make the numbers more staggering.

Your insult withstanding that I "cant do the math", I was unaware of early retirement in Greece. This does change my original position. The system does need some tweeking if your numbers are correct.

You're assuming that Social Security in Greece is funded via the corporate income tax, this is false, Greece has contributions from the employer and employee, 28% of the wages value compared to 16% from the employee, 6% shy of the average needed to sustain the scheme with the generous figures above, and it's expected to cover unemployment and health insurance too! These payments by an employer are a transaction classed as an expense and are completely aside from income which is taxed after these contributions have been made - "Why did you not know this?" because you didn't look, you're of the mindset that every problem is somehow linked to business and taxes, if corporate tax is going down well look no further, that's gota be why Greece has a huge debt problem - You want to know why corporate tax is going down? Because they need people to invest in Greece but nobody in their right mind want's to, they have to make it attractive because they need the trade, industry, jobs and revenues.

..and allow me to point out that you also are of the mindset that every problem is linked to business and taxes as well, otherwise you would not be a libertarian. Your view is that taxes should be rock bottom or non-existant and that businesses should be allowed much more freedom. If they are not given these benefits, then you have claimed many times that it "kills the economy". So dont try to act as if I am biased and you are not. We are BOTH biased. Am I allowed to point out that the mass majority of the worlds wealth is held in the hands of just a few right now? Its difficult to get investors when most of the cash is being sat upon by a small percentage of wealthy people. These wealthy people are also being granted more and more leniency to keep their cash. We need to get this money circulating again. We need to put the profit motive back into the moneyed owners again.

Greece is nowhere near as pro business as you're suggesting either, considering this little left-wing nation with a 40% of GDP public sector is apparently being run by "modern capitalists" - For instance, Greece taxes 20% of the total value of any commercial entity when it is sold as a whole or upon larger acquisitions and mergers, that means if you want to sell a business the government takes 20% of it's value outright. Also, considering the profit is taxed, then dividends are taxed and salaries are taxed, an income tax rate of 20-25% alone is a rather dubious method painting the picture.

Greece is left wing? And from what I saw of the tax exemptions, Greece very much appears to be pro business to me.

Okay, but how about a source and not a picture?

The source was posted just above the picture

Isn't that funny, you're figures leave off the top tax bracket, even for 2008, and they're not quite the recent figures are they?

Tax % The Tax Base (EURO)
0 1-12,000
18 12,001-16,000
24 16,001-22,000
26 22,001-26,000
32 26,001-32,000
36 32,001-40,000
38 40,001-60,000
40 60,001-100,000
45 100,001 and over

http://www.worldwide-tax.com/greece/greece_tax.asp

That is funny, seeing as I have pulled up another site that backs up my original list (http://www.taxrates.cc/html/greece-tax-rates.html) and then claims that your VAT percentage is WAY to high below. You said its 23%, this site says it is 19%. I am starting to realize that not only YOU have based your position on faulty numbers and percentages, but I have also fallen victim to the same problem.

"I will remind you that the price of milk doesnt change regardless of wether you make 1$ an hour or $10,000 an hour." Red Herring, this has fuck all to do with their debt crisis, I can find you countries with lower wages, taxes and smaller debt problems easily, Greece is compared to the rest of the world in a group of moderate to high incomes.

Excuse me? The price of milk is a red herring when discussing incomes and taxes? Im going to assume that you were not being rude to me.

And stopping this would have prevented a debt crisis how? These are all measures to give Greece an advantage over foreign competitors and to make Greek businesses more attractive to investors both foreign and nationally, being an export economy no tariffs on imports lowers the cost of living for all consumers... you speak as if these would hurt their position... I hardly think so. Besides, how many dozen countries around the world are comparable with these conditions? I'm willing to bet it's a substantial number, these are relatively commonplace policies yet Greece is the one in a debt crisis, so they're clearly insubstantial.

Greece is also having major problems with tax evaders as well.

You haven't given one single example, let alone shown it to be anything like a significant factor in their situation, and yet you assert "Anyone with a basic understanding of economics can see that"...

Their problem is not enough producing, too much consuming, too much entitlement. They consume more than they produce in their country, they need to borrow to sustain that, they didn't bother to invest in production, it's not a difficult thing to grasp, yet all you've done is rave about tax rates which couldn't possibly account for the massive void in their trade deficit even if taxes were higher and you haven't so much as described one causal chain for any of it.

People who use the word "entitlements" to describe services bought and paid for in advance are being dishonest. I have also pointed out that your tax numbers may be right or wrong, as well as mine. The problem I have with you right now is that using my original tax numbers, I have shown MANY reasons why the system failed.

"The problem in Greece will only get worse as the years go by. Why? Because the same people who are screaming "taxing the rich will kill jobs" fail to point out that the tax rates on the rich HAVE been going down and there is a direct connection between the decline of jobs and the decline of tax rates for the rich"

*Yawn*.

I figured you would act like that. So childish.

Have you really failed to understand the specific situation in Greece to the extent where all you're going to do is spout rhetoric?

Simply put, there are examples of nations that are either side of Greece in terms of wages, taxes, size of the public sector, private sector, regulations and the like but the vast majority of them are in nowhere near the situation Greece is in, the fundamental difference in most cases is not the tax level or whether family members can sell each other businesses or whether corporate tax is 20% or 35%, it's their failure to support a productive sector significant enough to generate the wealth needed to sustain their standards of living.

The man who types "*YAWN*" as a response turns right around and claims I am doing nothing but spouting Rhetoric? Really mature...really mature.

[theVOID]

Here we go with the mercantilism thing again. Is it me or do only the Libertarians bring that word up anymore? You do realize this is the 21st century..not the 18th? So let me start this with a resounding "hell no I wasnt talking about mercantilism". I was very much describing Modern Capitalism. As far as you saying there are no profits in Greece, I find that to be the biggest dishonest and generalizing quote I have ever read from you.

It's not really something you hear too often amongst them, seeing as it was popularised by someone out of the active political scene, Michael Shermer, before he'd used it in his book I hadn't really heard much of it as a description for the current economic situation (I only knew of it's historic context) and I picked it up from there, but aside from people who know that book I've seen little discussion on it. Mercantilism, as it was during the industrial revolution and the period following it, is far more akin to this current situation than anything else. Shermer has a good argument for the use of the term in his book "Mind of the markets" if you're interested and it largely has to do with the economic protectionism of private interests by the state that is prevalent in both and it's use of discriminatory trade practices to favour local producers at the expense of the consumer and it's subsidies on enormous scales to favourite industries, especially using the revenues taken from individuals.

The situation as it is now is nothing like capitalism and free markets, this fucking global scam where former politicians sit on the boards of corporate bodies in their droves, the likes of Al Gore and Clinton essentially acting as Venture Capitalists through all their old contacts who have the sweet deals they helped instate, whole chains of leadership associated with massive corporate interests who use the power we literally give to these people to create the conditions they desire, where these massive international organisations are stocked with huge corporate giants and taxpayer funded representatives who have all the power to make their own deals and secure their liability free actions with taxpayer money, setting up exclusive long-term deals with their buddies at Microsoft or giving billion dollar contracts to Electrical and chemical companies, setting up the markets so their friends in power have an unfair advantage of everyone else and where all their buddies are too big to fail - It's got fuck all to do with capitalism, there isn't shit that's free about that, this isn't free individuals using their earnings as they see fit, choosing their own investments, having a real chance to compete and where small businesses have a fair shot at the market because it isn't sold off in big contracts by the force of the state.

If you're thinking there's some big winner in Greece right now then who? It's not the banks, they're owed billions their unlikely to get back, it's not the businesses, they're mostly service sector and are up shit-creek when nobody has money to spend or when tourism flops, not the EU, they have to muster a large portion of their wealth in an attempt to keep Greece from defaulting by paying the debt that matures, it's not the foreign investors who are seeing the market collapse and their losses stack up, it's certainly not the Greeks who are being fucked over by decades of bullshit finally hitting the fan - Are there individuals who are profiting from Greece, sure but fuck all, not compared to what has been lost and what their counterparts get in financially stable nations - There is no big winner here, period.

You want an inside to their situation, go have a read http://www.asecu.gr/Seeje/issue06/katsios.pdf

Your insult withstanding that I "cant do the math", I was unaware of early retirement in Greece. This does change my original position. The system does need some tweeking if your numbers are correct.

You said above you had no problem with it above, now you're changing your mind? My numbers are really generous, I didn't account for a single beneficiary or healthcare cost even though all of them are in the social security pool that the people are expected to pay for.

..and allow me to point out that you also are of the mindset that every problem is linked to business and taxes as well, otherwise you would not be a libertarian.

That makes no sense... I see problems of entitlement blow-outs as problems related to entitlements, I see problems of debt as related to unsustainable borrowing and then consider the economic factors, I see problems of malinvestment as neither necessarily to do with business or tax, for instance a state grant to a community project that fails. I could list other scenarios but I hope by now I've made my point, the tax rates in the specific situation and the power of the business owners in the political landscape can be significant in some situations but in others they're insignificant or merely a small piece of the picture - The situation in Greece is not one where tax rates or political corruption or corporate lobbyists had the major role, it's one in a country that was sold unrealistic promises by zealous politicians who took vast sums of money in taxes from individuals and businesses designed to provide long-term and stable social services but managed to fuck up their investment so completely that they actually shrunk the productive sector over the last few decades and dug themselves into a situation where they are spending more on entitlements than they take in, where their revenues (mostly service sector related) drop sharply following a global recession and where the apparent urgency of it's station finally becomes noticed - Greece has been borrowing unsustainably for decades, all the corporate fuckery with the banks and investors that slapped them from over seas wasn't the cause of this, it was simply the catalyst for the illusion to crumble.

Your view is that taxes should be rock bottom or non-existant and that businesses should be allowed much more freedom.

None of this is at all relevant to Greece, but to clarify;

Some businesses gain freedom, others loose privilege - Considering how vast the state backed entities stretch that's a fair number who would, given the implementation of such a system, see much of their privilege cease to exist.

Businesses should have more 'freedom' in that they should be able to trade with anyone they like for any terms they agree upon, that's more of an issue of moral authority than anything else, a suggestion that we should have no right to tell any two consenting individuals or organisations what they can and can not do, we only have any legitimate authority to act when people are imposing on others without consent. I apply this principle consistently across all my views, seeing as moral positions are very much at the core of any world-view, I see no legitimate reason why the thought should depend on how much is being sold or whether someone else aside from this situation has healthcare or not. My individualism/libertarianism is a direct result of this principle, If you wanted to persuade me against it this would be where you'd have to start.

If they are not given these benefits, then you have claimed many times that it "kills the economy".

Bullshit i've said that.

So dont try to act as if I am biased and you are not. We are BOTH biased. Am I allowed to point out that the mass majority of the worlds wealth is held in the hands of just a few right now? Its difficult to get investors when most of the cash is being sat upon by a small percentage of wealthy people. These wealthy people are also being granted more and more leniency to keep their cash. We need to get this money circulating again. We need to put the profit motive back into the moneyed owners again.

I already said I believe this balance of power is a symptom of a system where those entrusted with power have questionable interests in a wide range of private entities. Your solution of taking the wealth from those with more whether or not they have done anything what-so-ever untoward to obtain it is immoral in my view, those who have been found to impose force should be taken from and those who have not should be given the opportunity to compete in a market that isn't tainted by back room deals.

Greece is left wing? And from what I saw of the tax exemptions, Greece very much appears to be pro business to me.

Sure they are, 40% of their entire GDP is public sector, that's freaking left-wing, not to mention that almost no government spending is in industry, it's almost entirely public service related... Out of all income, profit, spending, selling and the like the government is responsible for 40%... Massive public sector. Their tax exemptions are nothing unusual and actually rather protectionist, Greeks probably face higher prices for foreign goods and services for it, a likely contribution to their debt problem considering their reliance on foreign goods.

The source was posted just above the picture

Whoops didn't catch that.

That is funny, seeing as I have pulled up another site that backs up my original list (http://www.taxrates.cc/html/greece-tax-rates.html) and then claims that your VAT percentage is WAY to high below. You said its 23%, this site says it is 19%. I am starting to realize that not only YOU have based your position on faulty numbers and percentages, but I have also fallen victim to the same problem.

I had checked, obviously not enough there is a ton of contrary data, just like when I was digging up their employment data... good luck finding anything official. I had two other sources with the same figures as mine so assumed them safe though now looking I've found shit-loads of contrary information, two for the numbers you cited too, plus or minus some small differences and some that are different again and some about part way. I've found 3 other sources for VAT at 23% and wiki says 4% to 23% and less for goods, also there are sources for the income tax numbers that are different for 2008 on other websites. Another source has 13% for VAT... And different numbers for income.

I can't find anything resembling a report from the Greek treasury either,

Components of taxation > Corporate income tax 10.4%
Components of taxation > Goods and service tax 37.3%
Components of taxation > Personal income tax 14%
Components of taxation > Social security > Contribution by employer 15.5%
Components of taxation > Social security > Employees contribution 12.7%

http://www.nationmaster.com/red/country/...tion&all=1

Excuse me? The price of milk is a red herring when discussing incomes and taxes? Im going to assume that you were not being rude to me.

You're the one who's attempting to make this a discussion about income and taxes, it's by immediately shifting your focus to that as always that you're missing the big picture, the cause of the Greek situation has little to do with either because was it otherwise you would see other nations with similar rations in income and tax facing similar situations, you'll find most nations in a similar position are doing relatively well.

Greece is also having major problems with tax evaders as well.

Umm, wow, nice dodge.

Yeah, tax evaders are a problem, a problem caused by the emergence of their shadow economy, something caused by more fundamental problems.

People who use the word "entitlements" to describe services bought and paid for in advance are being dishonest.

What else does entitlement mean? A service that a person has a right to access to? Well gosh darn that's exactly what I was talking about. What the fuck is implicit in the word entitlement that mean one could not be talking about a paid in advance? Oh, and for the record, the services are NOT being paid for in advance, their youth are paying directly for the expenses of the retired population, there is no money left, they wasted it, they failed to invest it in any industry that could have possibly generated the income needed to sustain the long term costs!

I have also pointed out that your tax numbers may be right or wrong, as well as mine. The problem I have with you right now is that using my original tax numbers, I have shown MANY reasons why the system failed.

I don't know where you think you made this point but I'm unaware of any explanation you've given beyond citing tax numbers and then asserting cause. As I have said about a half dozen times now that you have not acknowledged; Other countries have very similar tax situations and expenses and have NOT fallen into a situation anything like Greece - This means for you to claim that this specific tax ratio is the cause means you are required to explain why this situation is not present in other similar scenarios - when you do you'll soon see that by focusing on taxes you've failed massively oversimplified and ignored the most important data, you've failed to notice the absolute stupidity that is the structure of the Greek economy, the massive reliance on imports, the piss-weak productive sector, the amount of people employed not to generate wealth in any way but to provide pleasure to those who already have it and the massive gap between the costs of "entitlements" and the revenue gained or invested to support them (which ties strongly back into the general structure of the economy) - These factors are so much more significant than any debate over a few percent of tax proportions that I'm quite blatantly dumbfounded by your continuing to ignore them.

The man who types "*YAWN*" as a response turns right around and claims I am doing nothing but spouting Rhetoric? Really mature...really mature.

I wasn't aware "Yawn" was a common rhetorical device, it was there to show my boredom with your assertions.

And through all of that you failed to even acknowledge my point which is evidence in direct contradiction to your conclusions about the causes of the Greek crisis, other nations with similar circumstances regarding taxes. Do you think I am mistaken in my observation? If so then explain why, but for the time being you haven't addressed it and it's a substantial objection to the very core of what you are claiming.

[reverendjeremiah]

You said above you had no problem with it above, now you're changing your mind? My numbers are really generous, I didn't account for a single beneficiary or healthcare cost even though all of them are in the social security pool that the people are expected to pay for.

Wait..are you cutting me down for actually admitting that I didnt have all the facts and in light of that your numbers convinced me? Looks to me like the employee needs to jack up his or her payment around an extra 7 percent or so..at least until the recession blows over.

---

I had checked, obviously not enough there is a ton of contrary data, just like when I was digging up their employment data... good luck finding anything official. I had two other sources with the same figures as mine so assumed them safe though now looking I've found shit-loads of contrary information, two for the numbers you cited too, plus or minus some small differences and some that are different again and some about part way. I've found 3 other sources for VAT at 23% and wiki says 4% to 23% and less for goods, also there are sources for the income tax numbers that are different for 2008 on other websites. Another source has 13% for VAT... And different numbers for income.

I can't find anything resembling a report from the Greek treasury either,

Components of taxation > Corporate income tax 10.4%
Components of taxation > Goods and service tax 37.3%
Components of taxation > Personal income tax 14%
Components of taxation > Social security > Contribution by employer 15.5%
Components of taxation > Social security > Employees contribution 12.7%

http://www.nationmaster.com/red/country/...tion&all=1

Yeah..same here. It is rather frustrating as well. How can me and you (or anyone else on this topic) have a decent discussion about Greece without good numbers. If the group of numbers I pulled up are correct, then I would say that my original deduction (though admittedly simplistic for space reasons) is probably in the right direction. Your numbers, on the other hand, toss out my hypothesis and may very much support your hypothesis. I am willing to change my view, as I did for the early retirement, if I can see some solid realistic numbers for this situation.

---

..and just for the record, I am not dodging your questions or posts. I have decided to suspend my judgement (past and present) in the light of conflicting facts and numbers. You may very well be correct and I may very well be incorrect...or vice versa.