Welcome to DU! The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards. Join the community: Create a free account Support DU (and get rid of ads!): Become a Star Member Latest Breaking News General Discussion The DU Lounge All Forums Issue Forums Culture Forums Alliance Forums Region Forums Support Forums Help & Search
 

dkf

(37,305 posts)
Sat May 26, 2012, 12:01 PM May 2012

Greeks Work Hard, So Why Is There a Debt Crisis?

Greek workers put in longer hours than any other Europeans or Americans, according to a new report by McKinsey. (Click here to read the full report) The consulting firm’s 60-page brief, “Greece 10 Years Ahead,” examines what makes the Greek economy so uncompetitive relative to its neighbors and offers advice on what to do about it.

Within the McKinsey report, however, there are two additional data points that explain why more hours worked by Greeks haven’t led to a growing economy.

First, Greece has the lowest labor participation rate in all of Europe — just 66 percent of the employable population have jobs, compared with 73 percent in the European Union and 70 percent in Southern Europe.

Second, not only are fewer Greeks working, those who do are far less productive: A Greek worker’s productivity comes in at $35 an hour, compared with $49 an hour in the EU, $55 an hour in Central Europe, and $58 and hour in the U.S.

Put it all together and it led McKinsey to one inescapable conclusion: "A relatively smaller percentage of Greeks work longer and harder hours than their European peers to support a generally unproductive system.”

http://m.cnbc.com/id/44944435/Greeks_Work_Hard_So_Why_Is_There_a_Debt_Crisis

7 replies = new reply since forum marked as read
Highlight: NoneDon't highlight anything 5 newestHighlight 5 most recent replies
 

dkf

(37,305 posts)
3. No it's the structure of their system including their propensity to evade taxes.
Sun May 27, 2012, 05:21 PM
May 2012

Which isn't the fault of the workers but of their government officials. Their leaders have failed them.

Mr.Turnip

(645 posts)
2. Well the Greeks have been known to evade taxes.
Sat May 26, 2012, 01:40 PM
May 2012

And the Government doesn't have a particularly strong way to stop that.

haele

(12,646 posts)
4. The major industry in Greece is shipping. The Greek shipping corporations don't pay their taxes.
Sun May 27, 2012, 09:19 PM
May 2012

I heard on NPR that more than a quarter of Greece's GDP is in the shipping business - especially in managing and flagging foriegn corporate vessals under the Greek flag - and the various businesses that are involved in shipping intentionally have gotten away with not paying corporate taxes - some of it is loopholes, but mostly, they have just decided not to pay and to live as if they - the owners and shareholders - were Pelliponesian Kinglets.
If they were paying them at the rate other Greek corporations are paying, it is estimated that those taxes would knock the Greek debt down by close to 1/3.
But, hey - these are the job creators and the funders of Greek policy. They're the ones providing an international tax shelter for multi-national corporations with Greek infrastructure. It's not like they were some lowly pensioner. They aren't supposed to be touched, right?


Haele

proverbialwisdom

(4,959 posts)
5. Not my issue, but here's quite a different perspective posted 6/20/11: 'Democracy vs Mythology'
Mon May 28, 2012, 12:12 PM
May 2012
http://wlcentral.org/node/1907

2011-06-20 Democracy vs Mythology: The Battle in #Syntagma Square #greekrevolution #europeanrevolution

What is going on in Athens at the moment is resistance against an invasion — and this invasion is being justified with the extensive use of mythology.

Mon, 06/20/2011 - 14:34

By Alex Andreou, originally published on SturdyBlog


I have never been more desperate to explain and more hopeful for your understanding of any single fact than this: The protests in Greece concern all of you directly.

What is going on in Athens at the moment is resistance against an invasion; an invasion as brutal as that against Poland in 1939. The invading army wears suits instead of uniforms and holds laptops instead of guns, but make no mistake – the attack on our sovereignty is as violent and thorough. Private wealth interests are dictating policy to a sovereign nation, which is expressly and directly against its national interest. Ignore it at your peril. Say to yourselves, if you wish, that perhaps it will stop there. That perhaps the bailiffs will not go after the Portugal and Ireland next. And then Spain and the UK. But it is already beginning to happen. This is why you cannot afford to ignore these events.

The powers that be have suggested that there is plenty to sell. Josef Schlarmann, a senior member of Angela Merkel’s party, recently made the helpful suggestionthat we should sell some of our islands to private buyers in order to pay the interest on these loans, which have been forced on us to stabilise financial institutions and a failed currency experiment. (Of course, it is not a coincidence that recent studies have shown immense reserves of natural gas under the Aegean sea).

China has waded in because it holds vast currency reserves and more than a third are in Euros. Sites of historical interest like the Acropolis could be made private. If we do not as we are told, the explicit threat is that foreign and more responsible politicians will do it by force. Let’s make the Parthenon and the ancient Agora a Disney park, where badly paid locals dress like Plato or Socrates and play out the fantasies of the rich.

It is vital to understand that I do not wish to excuse my compatriots of all blame. We did plenty wrong. I left Greece in 1991 and did not return until 2006. For the first few months I looked around and saw an entirely different country to the one I had left behind. Every billboard, every bus shelter, every magazine page advertised low interest loans. It was a free money give-away. Do you have a loan that you cannot manage? Come and get an even bigger loan from us and we will give you a free lap-dance as a bonus. And the names underwriting those advertisements were not unfamiliar: HSBC, Citibank, Credit Agricole, Eurobank, etc.

Regretfully, it must be admitted that we took this bait “hook, line and sinker”. The Greek psyche has always had an Achilles’ heel; an impending identity crisis. We straddle three Continents and our culture has always been a melting pot reflective of that fact. Instead of embracing that richness, we decided we were going to be definitively European; Capitalist; Modern; Western. And, damn it, we were going to be bloody good at it. We were going to be the most European, the most Capitalist, the most Modern, the most Western. We were teenagers with their parents’ platinum card.

I did not see a pair of sunglasses not emblazoned with Diesel or Prada. I did not see a pair of flip-flops not bearing the logo of Versace or D&G. The cars around me were predominantly Mercedes and BMWs. If anyone took a holiday anywhere closer than Thailand, they kept it a secret. There was an incredible lack of common sense and no warning that this spring of wealth may not be inexhaustible. We became a nation sleepwalking toward the deep end of our newly-built, Italian-tiled swimming pool without a care that at some point our toes may not be able to touch the bottom.

That irresponsibility, however, was only a very small part of the problem. The much bigger part was the emergence of a new class of foreign business interests ruled by plutocracy, a church dominated by greed and a political dynasticism which made a candidate’s surname the only relevant consideration when voting. And while we were borrowing and spending (which is affectionately known as “growth”), they were squeezing every ounce of blood from the other end through a system of corruption so gross that it was worthy of any banana republic; so prevalent and brazen that everyone just shrugged their shoulders and accepted it or became part of it.

I know it is impossible to share in a single post the history, geography and mentality which has brought this most beautiful corner of our Continent to its knees and has turned one of the oldest civilisations in the world from a source of inspiration to the punchline of cheap jokes. I know it is impossible to impart the sense of increasing despair and helplessness that underlies every conversation I have had with friends and family over the last few months. But it is vital that I try, because the dehumanisation and demonisation of my people appears to be in full swing...

<...>

So let me deal with some of that media mythology:
Greeks are lazy. This underlies much of what is said and written about the crisis, the implication presumably being that our lax Mediterranean work-ethic is at the heart of our self-inflicted downfall. And yet, OECD data ( http://stats.oecd.org/Index.aspx?DataSetCode=ANHRS ) among its members show that in 2008, Greeks worked on average 2120 hours a year. That is 690 hours more than the average German, 467 more than the average Brit and 356 more than the OECD average. Only Koreans work longer hours. Further, the paid leave entitlement in Greece is on average 23 days, lower than most EU countries including the UK’s minimum 28 and Germany’s whopping 30.
More at link.

Nassim Nicholas Taleb is the Lebanese-American philosopher who formulated the theory of “Black Swan Events” – unpredictable, unforeseen events which have a huge impact and can only be explained afterwards. Last week, on Newsnight, he was asked by Jeremy Paxman whether the people taking to the streets in Athens was a Black Swan Event. He replied: “No. The real Black Swan Event is that people are not rioting against the banks in London and New York.”
 

4th law of robotics

(6,801 posts)
6. Also throw in tax avoidance
Mon May 28, 2012, 01:00 PM
May 2012

even if they were more productive and had a more people working the increase tax revenue from all that extra money X 0.0% taxes collected on it would still be zero.

Latest Discussions»General Discussion»Greeks Work Hard, So Why ...