What are the Greek Austerity measures?

Really2

Really2 wrote: »

They have not defaulted as in, "we are bust, see you later, no more money to go out, sorry guys" though have they?
The hair cut in reality is the defalut at the moment.

But the question no one seems to be able to answer. If Greece were to start again. What could they afford?

Does the austerity give them a budget surplus? or would greece still have to expect a massive change to how they are run? I suspect the latter.

But the more people go on about austerity being unsustainable but not indicating what is sustainable to greece it is hard to gauge the context of the austerity.
Basically is the austerity worse, better than what they can expect in the future should they be allowed to orderly default and go it alone?
What can they support with their current tax incomes etc. these are the questions no one seems to be answering? So yes the austerity is bad, but how bad is it compared to the points above?

Ill bump this, as I am sure someone will/might know, but it is a point I would really like to get my head round.

So sorry for bumping.

ILW

Kennyboy66 wrote: »

Why bother asking ?

You have been given a comprehensive reply but you have made you mind up already.

Youth unemployment is 44%
25-34 unemplyment is 23%

Both increasing at a rate of knots and about to get a whole lot worse.

There are a whole host of structural problems with the Greek economy that only the IMF will sort out, but fatous posts like yours don't really add to the sum of the debate.

My point was that the Greek people are rioting about having to cut certain things to levels which most of Europe have been putting up with for years.

They seem to believe they have a right to a standard of living way above what they can afford and expect others to pay for it.

Graham_Devon

Really2 wrote: »

I really don't think people understand how bad default would be for them now.

Well I do, and it would be bad.

But not as bad as extending the pain and extending the suffering to families and simply defaulting later.

There is no other choice but to Default, or have other people in other countries paying a levy in tax to pay for the Greek people, and that ain't going to happen.

I also note your comment regarding dusting off. I didn't suggest the Greek's could just dust it off and start again. I stated they can start dusting down. Massively long path. But untul the default happens, they can not start walking down another road and start to FIX the issues.

No one, especially not myself, has suggested a default will not be painful or have serious consequences. I have suggested the consequences will be severe if they do it now, but better than extending it for another 2 years and trying to live with mass riots, protests etc ending in injury and sometimes death, removal of basic living requirements etc, only to do it later.

tomterm8

ILW wrote: »

Just as a comparison, do the vast majority of Greek workers get taxed at least 40% of their wages?

Gets all complex, doesn't it? In general, income tax LOOKs like it is lower, but employer contribution is higher, and Greece relies more heavily on VAT and property taxes because frankly the Greek tax authority is worse than the UK one at collecting taxes. So Greece tends to tax things people can't hide so easily.

That's the point of the new property tax... you can't hide the fact you own a home, and if you want electricity you have to pay.

Really2 wrote: »

They have not defaulted as in, "we are bust, see you later, no more money to go out, sorry guys" though have they?
The hair cut in reality is the defalut at the moment.

a 50% cut is a pretty hefty non-default.

Really2 wrote: »

But the question no one seems to be able to answer. If Greece were to start again. What could they afford?

Because the reality is that Greece needs to be out of the eurozone. There is no way I can see of Greece regaining enough competitiveness to get on an even keel within the eurozone.

It needs to leave the euro zone, devalue around 20% (which would mean everyone in the society effectively getting a wage cut), and default at the same time.

It's no secret that the UK economy is worse managed than Greece, that we owe more (when you consider all the off balance sheet and unaccounted debt), that out banks are in worse shape, and that we have a larger gap between what we earn in tax and what we spend...

And yet, we have the policy tools needed to regain competitive advantage.

( still, sooner or later the UK will probably default ).

RichandJ

Old_Slaphead wrote: »

£7475 is for current (ie 2011/12) tax year

It will be £8,105 for those under 65 for 2012/13. Google:

uk income tax allowances 2012/13

and the first HMRC link that comes up opens the PDF.

Thrugelmir

Old_Slaphead wrote: »

£7475 is for current (ie 2011/12) tax year

Cheers. Amended.

Really2

Graham_Devon wrote: »

No one, especially not myself, has suggested a default will not be painful or have serious consequences.

But If I were Greek I would really like some idea other than bad.

Not a pop at you, but in reality. Someone has to highlight what their future will be like.

I am not pro bailout, but I really think the idea has to go past "nasty austreity" to this is what you will expect if this happens......

ILW

Really2 wrote: »

But If I were Greek I would really like some idea other than bad.

Not a pop at you, but in reality. Someone has to highlight what their future will be like.

I am not pro bailout, but I really think the idea has to go past "nasty austreity" to this is what you will expect if this happens......

I agree.

It seems that the Greek man on the street does not know what the results of their options will be.

ie what would be worse for you, current austerity proposal or full default and leave Euro?
has it ever been spelled out?

Really2

tomterm8 wrote: »

a 50% cut is a pretty hefty non-default.
But orderly arranged as per my post



Because the reality is that Greece needs to be out of the eurozone. There is no way I can see of Greece regaining enough competitiveness to get on an even keel within the eurozone.

It needs to leave the euro zone, devalue around 20% (which would mean everyone in the society effectively getting a wage cut), and default at the same time.

It's no secret that the UK economy is worse managed than Greece, that we owe more (when you consider all the off balance sheet and unaccounted debt), that out banks are in worse shape, and that we have a larger gap between what we earn in tax and what we spend...

And yet, we have the policy tools needed to regain competitive advantage.

( still, sooner or later the UK will probably default ).

UK does not need to be brought in to this as I want to understand what this means to the average greek. But you still do not indicate is the current austerity measure likely to be there or worse should they leave the euro.
Tax returns will not change over night, so I understand if you can't answer it. But what would greece be looking at in terms of the short to medium term future.
My guess is the austerity measure would be probably worse for a good few years (5+) and standards of living and prevoius benefits and taxation levels were unlikely ever to come back.

Really2

ILW wrote: »

I agree.

It seems that the Greek man on the street does not know what the results of their options will be.

ie what would be worse for you, current austerity proposal or full default and leave Euro?
has it ever been spelled out?

Exactly, although the people choice looks to have gone now no one seems to be saying "this is our future should we".

1) Stay in euro
2) Orderly Default and leave
3) Disorderly default

I find it hard to comprehend and how others could comprehend what this austerity is like unless they know what the options really look like.

Perhaps they will get a choice in the future, but the idea on the referendum without spelling out what happens was an odd one. It was obvious it was going to be a no to the bailout without knowing the effects.