Friday, August 20, 2010
Why the Greek economy failed . . .
Having now written a fair bit about Greece I often find people asking my opinion about the present economic woes in the country. My first response is to make clear that none of it is my fault, closely followed by the observation that I am not an economist. I also like to point out that anyone who thinks that the current wave of rioting in the streets, and mass strikes, are in anyway unusual, has not spent much time in Greece. In the end, though, I usually tell them the following story; I think it explains a lot.
About 15 years ago I was chatting to a Greek acquaintance late at night, or possibly early in the morning, in a small village taverna. We’ll call him Panos – it might even have been his name. Much beer, wine and tsipouro had been consumed, and Panos had got down to the favourite Greek pastime of setting the world to rights. (I’ll leave out the swearing).
“I’ll tell you what the problem with this country is, Andy. It’s taxes! No-one pays them! Everybody complains: about the schools; about the roads; about the hospitals. Everybody complains that the government does nothing. But what can the government do? It has no money! If people gave the government what it was due, perhaps then they could start to sort out the problems, but instead everyone just looks out for themselves. It is the Greek way.”
I thought this was eminently sensible, and told Panos so. “It must make you angry,” I said, “being one of the few that contributes”.
“Good god,” said Panos, “I don’t pay my taxes either! Why should I, no-one else does . . .”
So there you go. I’d only like to add that, although it may take time, I have no doubt that the Greeks will weather this particular storm, helped, no doubt, by their sometimes insufferable self-belief and pride. I wish them well.