You are not understanding increasing the cost of tax dodging is a big part of reforms demanded. As it stands, the cost of tax evasion is too low.

Thanks for the memories.

Some incredibly dumb arguments from you in those quotes.

Now I see why I forgot you.

I'll remember you for being a bit weird tho, nice necro of a five year old thread.

Again, it's such a big part that we're about to reach Austerity Reform #8 as demanded by the Eurozone and apparently nothing was been done. And as you said, Europe was totally satisfied with everything and if it wasn't for those radical economists like Varoufakis, they were about to give out another bailout in exchange for I'm guessing some tax increases and spending cuts or something. You admitted that previous administrations are basically tax dodgers and you want them back in power. And European leaders too, because Varoufakis made them feel dumb or something. Clearly something doesn't add up. It seems to me that all this talk of spending is a complete sideshow - if they fix tax collection, they will be fine.

There have been no outright haircuts. There was talk in 2012 of haircuts if the Greeks adhered to the demanded austerity program. Which the Greeks did. To no avail. The debt as a % of GDP is now greater than it was before because austerity during recession/depression can't and won't expand the economy.

And now once again the EU has offered potential future haircuts if the Greeks once again adhere to further austerity measures.

But there has been no official offer of any haircuts. Greek bondholders have sold for 80% of face value based on past EU support deals. So that is a haircut of sorts, but the Greek government was not the beneficiary.

Historically, countries facing the type of insolvency that Greek is today (including Germany multiple times), were granted approximately 40% debt relief. In addition to lengthening of debt repayment and lowering of interest rates. If this type of deal was on the table in conjunction with structural reform in Greece including better tax collection I would guess the Greek government would take it. The IMF if given authority at this point might advocate it. It is the EU and Germans who don't want this type of precedent set.

By any measure the Greeks are suffering through multiple years of depression the likes of which we haven't seen in our lifetimes. It is comparable to but worse than the depression the US went through starting in 1929. And they are missing the one tool that could give them half a chance. Printing their own money.

I can creepy internet stalk too.

Phone Booth

Current Activity: Viewing Thread How can banks lose? (From 2010)

Jesus christ man.

Oh wow, you still think you were right about the fed creating money leading to FREE MONEY for the investment banks because they have FIRST DIBS? And how it's TOTALLY RIGGED that you borrow at retail rates and banks have access to interbank lending? That is incredible.

Whatever.

If you can move on and unrustle your jimmies maybe you can start debating the topic in this thread like a grown up.

Its kind of ironic how you debate like a stereotypical German.

Sorry Germans.

All the way back in 2011, private debt holders took a ~100 billion euro "voluntary" haircut.

This is another thing that's easy forget - Syriza ideally wants to reverse much of the austerity reform and stimulate the economy while they ramp up their tax collection efforts, but they have absolutely shown willlingness to take any reasonable deal so they can focus on governing. It's the Eurocrats that have been completely intransigent and have continuously threatend to ruin Greece over the debt.

Krugman had a good point about the combination of hard money and austerity:

http://krugman.blogs.nytimes.com//20...e-eurodebacle/

Amazing Germany is to blame, not greeces horrible management of their own affairs

That's one explanation. Another is that Greeks don't believe they should have to pay their taxes, and the government is too weak or corrupt to improve compliance.

Obviously if you are suffering, in some metaphysical sense you're always to blame, but the point of rhetorical blame is to incentivize and influence behavior and for obvious reason incentives always exist for you not to suffer, which means rhetorical blame is sort of meaningless.

Also, we're talking about a very specific point in time when Greece had no real choice and Europe seemingly offered the only possible option. They may have been able to take a stronger stance in terms of guaranteed future support and they probably had the leverage because Europe in 2010 was probably in no position to deal with a Greek default, but that's not what the people blaming Greece are saying.

These explanations are not mutually exclusive. These are just statements about preferences and market position/power and they can be explaind through microeconomic models. Both these btw point to optimal tax rates being lower, not higher.

feel free to make your case about the achievements of Varoufakis

So if the tax rate was lower the government would not traditionally suspend tax collectors during elections.

The Greek government was not to weak to collect tax, it was totally complicit in the non collection of tax, tax avoidance was institutional.

https://en.wikipedia.org/wiki/Greek_...ountermeasures

As I said earlier, in a vacuum a large stimulus for Greece would make sense, but you cant just throw money at an government/state that is so institutionally warped. This might not be the current admins fault but that is hardly relevant.

Krugman:

"no matter how hard the Greeks tried, austerity would shrink GDP faster than it reduced debt relative to the baseline, so that the debt situation was bound to worsen even as the attempt to balance the budget imposed vast suffering."

I don't see any way around this.

Most people want an economy where the young have to bear the burden of funding an ever growing population of retirees, both in absolute and relative numbers, through taxes?

That's an interesting take, but think that's extremely unfair, economically destructive and self-defeating.

Anyway looks like the new proposals from Greece are very austere, basically rendering the No in the referendum totally moot.

So this means we will back here soon enough and there is no chance of the thread going into stasis for Phone Booth to necro in 2020.

http://www.theguardian.com/business/...as-draghi-live

Working people have to support non-working people - whether you do it through forced labor, pensions, 401ks, IRAs, reverse mortgages or fat brokerage accounts doesn't change the dynamic where the services are provided by young, working people and consumed by old, non-working people. No amount of privatization, austerity and writedowns changes this.

When you're talking economics, you have to be grounded in reality - the exchange of services and products is the actual economy - money and ownership are just social fiction designed to facilitate the process. Young working people have always had to support old retirees and this will not change in the future.

Loooooooooooooooooool.

This is the worst possible outcome.

The **** sandwich must be eaten today, next time it will have much more poo in it.

Tsipras is a joke.

In an isolated country this could be true, as you could save what you want, if there's nobody to produce anything, it's not worth much. But in international contexts this matters much less and national savings can be used to cover trade deficits. This means it matters a whole lot whether the retirement system is set up as a pay-as-you-go system or as a delayed income system (savings). The latter also provides for investment capital on the local level, so even though it reduces current spending, it adds value to the economy way before it's worth is ever consumed.

Regardless, by raising the retirement age, lowering the benefits and stopping the inflow from people who should be on unemployment insurance or disability benefits and create viable schemes for that, you restore a bit of the balance between working and non-working people.

It's much better than just pumping money in and hope the economic growth will cover up the demographic disaster, because it won't.

Immigration could help as well, but I don't have the idea the Greeks are very fond about that idea.

I don't think anyone is against these things in a vacuum - the question is, should you make these adjustments in the middle of a deep recession? I mean basically everyone accepts and understands countercyclical fiscal policy, right? What good are you really accomplishing by throwing retirees into the labor pool when your unemployment rate is 25% or something?

The retirement system can be set up as a pay-as-you-go system and the national government can have foreign currency reserves and sovereign funds to deal with shortfalls and fluctations. One has nothing to do with the other.

Also, aggregate of individual savings is not national savings - most people don't save in foreign currencies so counterintuitively, individual savings add up to national debt.

Furthermore, buying foreign assets to pay for an aging population works for individuals but is problematic for the country in the long run because it both 1) deprives the national government and local economy of taxes/jobs/investment/etc and 2) leads effectively to foreign influence on national politics and in general expansionist foreign policy. See reasoning below:

http://forumserver.twoplustwo.com/41...point-1245897/

Re: the bolded. Since Greece are part of a currency union, savings by individuals don't necessarily have to translate into national debt.