Hypocritical Germans refuse to aid the countries that aided them

[Beezer]

The debt was forgiven because creditors saw that the country had changed and that forgiveness would play an integral role in an economic boom that the rest of Europe would profit from as well. If all of Greece's debt was forgiven on the other hand, Syriza would begin digging a new hole tomorrow by hiring public sector employees nobody needs while not addressing the underlying factors that make Greece such an unattractive place to invest.

Moreover, why is everybody always focusing on Germany?! It's not like Finland, the Netherlands or a few of the peripheral countries who pitched in when it came to bailing out Greece while enacting their own reforms are particularly crazy about a more lenient stance.

[Beezer]

You're right, it's not a Scandinavian thing. All the North European countries (even France, to some degree) have the same smug attitude and feel entitled to educate those lazy southerners about how to best manage their economy.

Well, considering the economic state the north and south find themselves in, a certain smugness is not necessarily uncalled for.

I do believe that Syriza could be a breath of fresh air when it comes to dealing with tax evasion and other endemic Greek problems. I just doubt their primary economic programs that can be boiled down to "let's throw money at it" will do a better job of getting Greece out of this mess than austerity (which Greece did a pitiful job of implementing).

[Beezer]

I do believe that Syriza could be a breath of fresh air when it comes to dealing with tax evasion and other endemic Greek problems. I just doubt their primary economic programs that can be boiled down to "let's throw money at it" will do a better job of getting Greece out of this mess than austerity (which Greece did a pitiful job of implementing).

Obviously Samaras was unwilling to address issues like tax evasion or endemic corruption; it's good that you admit that the new government has at least the intent. However, Greece has been running a primary surplus which has been handed on creditors, so... was really the previous administration so bad in implementing austerity? Also, is there any historical precedent proving that austerity works? What debt ratios and socioeconomic indicators say?

Well, according to the current Greek finmin that (2013) surplus wasn't much of a surplus after all...

According to the official figures that Eurostat just released, Greece’s general government had, in 2013, a primary deficit of 12.7% of GDP if we add to it the cost of recapitalising the banks (again during 2013). Let’s accept that this cost should not count as part of the government’s outlays (even though it is not clear why it should not). According to the official announcement, a 2013 primary surplus thus emerges to the tune of €1.5 billion (note that ELSTAT had announced, under the ESA95 rule, a primary surplus of €3.39 billion which was then  ‘downgraded’ to €1.5 billion). From this €1.5 billion we ought to subtract the government’s arrears to the private sector for 2013, of about €4 billion, since the government had a contractual obligation to pay these monies within 2013 (but didn’t). But, for the sake of argument, let us, again, be ‘generous’ to the Greek government, ELSTAT and Eurostat and accept their shaky argument that these arrears ought to be kept out of the government’s 2013 outlays. The fact is that, even then, a primary deficit of €3.9 billion is the true, final, number. How come? The answer is wholly unappetising.

Buried inside the official national statistics (see the comments below for the sources, as posted kindly by a reader), the keen observer will notice something rather strange. To be precise, she will notice two unexpected ‘windfalls’ that have turned the Greek government’s primary deficit into a primary surplus. Was it manna from heaven? Some boost in the tax take? No, none of that. It was two so-called ‘white holes': €700 million was ‘discovered’ inside the local authorities’ accounts and another €4.7 billion inside the accounts of the state pension funds. Last year, in 2012, these ‘holes’ were distinctly ‘black’. So, how did they turn ‘white’ in 2013? Did local authorities and pension funds experience a stunning revival? No, dear reader. Rather, monies borrowed by the Greek state, from Europe, were parked into these accounts during 2013, did not count as part of the state’s new liabilities, but were counted as part of its… assets. Of course, anyone who knows anything about Greek public finances knows that local authorities and, especially, pension funds are bankrupt – profoundly so the pension funds which, following  the 2012 PSI, saw much of their capitalisation disappear into thin air. The notion that, during 2013, local authorities and pension funds held more that €5 billion worth of real, home-grown liquid assets on behalf of the government is utterly laughable.

http://yanisvaroufakis.eu/2014/04/24/greek-statistics-are-back-primary-deficit-presented-as-surplus-with-eurostats-seal-of-approval/

Concerning austerity working...I don't have a background in economics but it is clear that it could have been implemented in a better manner. I still believe though that the pursuit of a Keynesian path in Greece would not have led to a substantially better outcome. Greece would in all likelihood have done an even poorer job of implementing reform commitments and its economy would thus be in an even less competitive state today. A far more sensible solution would have been an orderly default in which the French, German and other European governments would then have bailed out banks on a case by case basis instead of handing the money over to Greece which then paid off its European creditors.

[Beezer]

Following your logic, wealthy people are entitled to be smug towards poor people. How progressive!

No, affluent people that have obtained their wealth due to sensible choices and industriousness can lend advice to others who repeat the same mistakes over and over again.

Anyway, all of this could have been avoided if we weren't joined at the hip by a common currency. If Greece prefers a Socialist approach to running their economy they ought to be perfectly free to do so w/o German interference.

[Beezer]

Eurozone meeting ends in tears...is this the end?