Dysfunctional Greece dances on the cliff edge

Greece
Photo credit: Euractiv.ro

There are few global civilized political systems more screwed up than Greece. If the Greeks prefer their system, that’s their business to continue wallowing in dysfunction. That is, until it begins to poison America’s financial system.

Exercising questionable judgment in January, Greek voters elected Alexis Tsipras, a far-left leader of the radical Syriza political party, to rule their nation.

Tsipras is an atheist who has been a radical communist since the 1980s. His son is named after Che Guevara.

Same as America’s supreme leader, Tsipras never ruled anything before he became prime minister. The German newspaper Der Spiegel describes him as walking “up to the lectern like Elvis strutting onstage.” The man sounds like a North Korean leader, pontificating, posturing, and offering no real solutions. He is popular with Greeks because of promises he made during campaigning, which included lifting austerity programs imposed by Greece’s creditors in the European Union and the International Monetary Fund. His three main promises were incompatible with each other, smacked of demagoguery and created internal contradictions impossible to resolve.

Fast forward to June 30, when Greece faces a series of major defaults on its gargantuan level of sovereign debt. Greece has very little money. Its liabilities are more than $360 billion. This is an astonishing, distressing sum for a country of 11 million people, who got into this jam because they elect leftist leaders who made irresponsible decisions. Their debt is expected to exceed 180 percent of gross domestic product this year.

But it’s not the first time Greece has defaulted on its legal obligations. It has a long history of government failure, owing to the socialist policies of their electeds.  Greece has defaulted on its sovereign debt obligations at least five times in the modern era, from 1826 to 1932. The combined length of time when Greece was in default totaled 90 years of stiffing its creditors, or about half of the time the country has been independent.

The current crisis began in 2000, when Greece applied and was approved for membership in the Eurozone. This meant party time in Greece, with its new credit rating.

It was discovered later that Greece lied about its finances in order to win membership, and had hidden over $1 billion of debt. Its financial strength since then was never earned, it was borrowed. And now the wolf is at Greece’s door because for generations their way of life was to borrow money, spend it on themselves, and then fail to honor their legal obligations to repay it. The Greek electorate is like the pouty little girl who stamps her feet and cries when told there will be no more lollipops.

Greece cannot pay its debts because its socialist economy is a disaster, too weak to create wealth and capital. The solution is for Greece to exit, or “Grexit,” the Eurozone and fall back on the drachma, its old currency, then let the chips fall however they fall. The Marxists who run the country can ignore economic reality and print as many drachmas as they wish, and then watch massive currency devaluation as inflation washes over the country.

Look closely and you will see the disease that has permeated Greece’s modern history gaining traction in other Western democracies, especially in America.

But what the Greek crisis tells us is a lesson for the learning. America’s far-left wants the U.S. to embrace the same Western European political and social template that has caused economic chaos in Greece, Cyprus, Spain and France.

We see in America today the middle stages of the same problems that are bringing Greece to its knees: persistently high unemployment; $18 trillion in federal U.S. debt, escalating public pension liabilities, a socialist, European-style president, anemic economic growth, significant percentages of citizens who pay no taxes and rely on public handouts, erosion of the rule of law, economic illiteracy among federal officials, a weakening of the “work ethic” and a rise in personal indulgence and family decay, and widespread social safety nets.

America and Greece now need the same thing: an election that will put sane executive-branch leaders into power.

John R. Smith GET AUTHOR RSS FEED

John R. Smith is chairman of BIZPAC, the Business Political Action Committee of Palm Beach County, and owner of a financial services company. He is a frequent columnist for BizPac Review.
John R. Smith

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