
Stand With Greece - sebkomianos
http://standwithgreece.com/
======
latch
Can someone explain to me if and why I'm wrong to think of Greece as a
deadbeat? I understand the point that they were forced to make cuts in
exchange for loans, and this only further depressed their economy, but where
did that money go and shouldn't the government and people be accountable for
it?

Also, even if they were wrong to do so, something must have caused creditors
to demand austerity, have those issues been solved? If Greece was given a
clean slate, would it be a healthy, productive and growing economy?

There are a lot of places in the world where people have horrible social
support. I don't wish it for anyone, but that's the reality for a lot of
places. Maybe that ought to be the reality for Greece? Work until you die,
third rate health care and infrastructure. I'm not happy to see it, but if you
can afford more, energy is something that must be produced.

~~~
glesica
I'm sorry, I realize that you're asking for clarification, but it is really
frustrating to keep hearing this kind of crap. Greece the country didn't
borrow all (or even most) of that money, private borrowers borrowed it from
German banks (or Greek banks that borrowed it from German banks). The money
ended up as public debt because the banks got bailed out.

The reasons for this were complex, but had a lot of do with German fiscal and
labor policy. Once the loans turned out to be bad (because why on Earth did
the banks expect that all of these funds could possibly to put to good,
productive use, especially once credit standards were lowered), Greece was
expected to deal with the situation. They did, and they bankrupted the country
doing so (same with Portugal, Spain, and Ireland).

There is, of course, plenty of blame to go around, but this _is not_ a
situation where the Greek government borrowed a ton of money and wasted it.
They borrowed a ton of money to bail out their banking system _including_ a
bunch of German banks (which is where a lot of the money originated). This is
exactly what the global economic elites were telling everyone to do in 2008.
Then, once things got ugly, those same elites decided that the Greek people
should collectively pay the price for two bad economic policies that were only
partially the fault of their government.

Suggested reading:

[http://www.amazon.com/Austerity-The-History-Dangerous-
Idea/d...](http://www.amazon.com/Austerity-The-History-Dangerous-
Idea/dp/019982830X) \- this book goes into great depth about what exactly
happened in Europe.

[http://blog.mpettis.com/2015/02/syriza-and-the-french-
indemn...](http://blog.mpettis.com/2015/02/syriza-and-the-french-indemnity-
of-1871-73/) \- blog post that describes how what has happened in Greece,
Spain, and Portugal was effectively inevitable and not the fault of the
respective governments so much as it was a result of a series of pan-European
financial blunders.

~~~
protomyth
"Greece the country didn't borrow all (or even most) of that money, private
borrowers borrowed it from German banks (or Greek banks that borrowed it from
German banks). The money ended up as public debt because the banks got bailed
out."

In the US there was quite a series of legal moves requiring banks to lend
mortgages to people who didn't previously meet the banks criteria. Were German
banks similarly compelled or was it just bad judgement of the banks?

~~~
pjmorris
Could you be specific about these legal moves? Are you referring to the
Community Reinvestment Act (CRA)[1]? Most of the subprime lending was done by
banks that weren't held to those standards [2]. And CRA conformant loans have
had better repayment records than the bulk of the pre-crisis securitized
subprime lending.

I believe it was bad judgement^H^H^H^H^H^H^H^H^H a business decision on the
part of the bank(s).

[1]
[http://en.wikipedia.org/wiki/Community_Reinvestment_Act](http://en.wikipedia.org/wiki/Community_Reinvestment_Act)
[2] [http://www.ritholtz.com/blog/2009/06/most-subprime-
lenders-w...](http://www.ritholtz.com/blog/2009/06/most-subprime-lenders-
werent-covered-by-cra/)

~~~
protomyth
Yes, the CRA as modified by follow-up legislation. Your [2] actually gets its
data from an article in the Orange County Register [3] which claims to do an
analysis of a database that they do not provide or reference.

A article of history [4] and the numerous WSJ articles provide a pretty clear
picture. CRA had some very foolish amendments including some that affected the
deployment of ATMs of all things.

It wasn't the single cause, but it was a major player.

Which brings me back to my original question "Were German banks compelled to
make bad loans or was it their failed risk judgement?"

3) [http://www.ocregister.com/articles/loans-20542-subprime-
bank...](http://www.ocregister.com/articles/loans-20542-subprime-banks.html)

4) [http://www.businessinsider.com/the-cra-debate-a-users-
guide-...](http://www.businessinsider.com/the-cra-debate-a-users-guide-2009-6)

~~~
crdoconnor
>It wasn't the single cause, but it was a major player.

It wasn't a cause at all, as I pointed out above (with citations to the
relevant studies).

The line you keep spinning is the same line used by the banks as they tried to
dodge responsibility for the subprime crisis: blaming it on Congress "forcing"
them to lend to black people.

~~~
protomyth
Wow, bringing race into this? really? Nope, not going to discuss anything with
someone who substitutes race to win an argument when we are talking about
economics. Unable to pay has nothing to do with race. This is a shameful
tactic.

~~~
crdoconnor
>Wow, bringing race into this? really?

The Community Reinvestment Act was at its heart about ending redlining of
poor, black neighborhoods.

This is not at all a controversial part of the story.

------
cperciva
Comparing the Greek economy now to where it was in 2008 is disingenuous. The
Greek economy was thriving last decade due to a program of systematic fraud by
the government; complaining about the decline since then is like bemoaning the
fact that you have to take the bus after the police seized the car which you
stole.

~~~
tomp
> complaining about the decline since then is like bemoaning the fact that you
> have to take the bus after the police seized the car which you stole.

More like, complaining that you have to take the bus after the police seized
the car which _other people_ stole and sold to you at full price.

------
evoloution
Most of the slides show the effect of devastation of the Greek economy and
social net.

Slides 5 and 6 can be a bit misleading since it only shows that in Greece the
monthly minimum wage is 586 Euros. This number is still higher than some
countries of the Euro Zone, and people may think that it is pretty fine.

In order to understand the crisis you have to consider that the minimum wage
in 2008 was 794.02. In addition to that some people settle with salaries as
low as 300-400 out of fear to lose the jobs they have in struggling small
businesses. 25% unemployment is really an underestimate since people who have
lost their short-temp jobs or never had any job or are in some kind of
educational program are not counted as unemployed.

Now take into consideration that salaries were pretty predictable for decades
and people made their plans, mortgages etc, and you get a taste of what is
happening...

------
ErneX
The problem with allowing Greece to not pay the debt or part of the debt is
what happens with the rest of the countries that are not only contributing
with Greece (Spain alone I believe has given 26bn € to Greece) but are also
enduring harsh economic measures to put their economies in order?

~~~
toomuchtodo
> what happens with the rest of the countries that are not only contributing
> with Greece (Spain alone I believe has given 26bn € to Greece) but are also
> enduring harsh economic measures to put their economies in order

They should exit the Euro. Better to default, deal with the temporary pain,
and re-emerge vs being shackled to austerity-induced slavery. Like Iceland
did.

[http://www.spiegel.de/international/europe/financial-
recover...](http://www.spiegel.de/international/europe/financial-recovery-of-
iceland-a-case-worth-studying-a-942387.html)

------
soroushjp
This was a great way to see the human cost of economic stagnation and
austerity in Greece, but it doesn't talk about the causes of these issues or
the best way forward. Like others have said, there are many countries
worldwide with poor quality of life and poor economic growth , but what caused
it in Greece and what can be done to fix it? Playing into a game of picking
sides in Greece versus the big bad EU powers doesn't seem credible or
productive to me.

------
crdoconnor
They missed perhaps the most awful kick in the teeth by austerity - Greeks
can't get lifesaving drugs:

[http://www.wsj.com/articles/SB100014240531119044917045765747...](http://www.wsj.com/articles/SB10001424053111904491704576574791877220786)

[http://www.reuters.com/article/2012/11/03/us-greece-drugs-
id...](http://www.reuters.com/article/2012/11/03/us-greece-drugs-
idUSBRE8A205Z20121103)

------
joshfraser
Not sure I get the call to action here. What does it mean to "stand with
Greece"?

------
andrewstuart2

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etc.

If you _really_ want to show your support for Greece, you certainly can.

------
kaa2102
Austerity for the sake of austerity must end.

------
mschuster91
Pure capitalism does not care about people.

~~~
lukasm
Who do you sell to?

------
jfmercer
<sarcasm>Great. Programmers talking as if we were economists. Here we
go.</sarcasm>

