Failed Greek Bailout Forces More Rescue Talk From Europe

CNBC ^ | Monday, May 23, 2016 | John W. Schoen

[SunkenCiv]

Less than a year after the country's third international bailout, Greek lawmakers on Sunday approved another round of painful tax hikes and spending cuts in hopes of securing more cash from its skeptical European neighbors. The infusion is needed to help Greece make good on bond payments due in July.

The measures approved over the weekend include tax hikes on consumer goods like fuel, alcohol and tobacco -- to 24 percent -- and a provision that will force further spending cuts if the government fails to meet budget targets...

Less than a year implementing after a package of reforms and relief designed to revive growth, Greece's economy continue to contract.

Last July, a relief round of 86 billion euros ($96.4 billion) was intended to buy Greece's government time to implement reforms and revive growth. But less than a year later, the plan's targets were apparently far too optimistic, according to Carl Weinberg, chief economist at High Frequency Economics...

Since the first relief payments in 2010, Europe has spent more than a quarter of a trillion dollars trying to keep Greece afloat...

With roughly a quarter of Greek workers out of a job, those lost income tax revenues add to the government's cash squeeze. Many of those workers rely on government pensions and other support...

The measures approved Sunday include cuts to those payments, by about two percentage points, to 15 percent of GDP by 2019. That will further crimp consumer spending and create another economic headwind.

The failure of last year's plan has many observers, including officials at the International Monetary Fund, skeptical that a repeat of last year's bailout will produce any meaningful improvement in Greece's economic future without debt relief.

But bond holders and EU officials remain reluctant to lower interest payments or restructure Greece's debt.

[SunkenCiv]

Protesters shout slogans during a demonstration against a new package of tax hikes and reforms in front of the parliament building in Athens, Greece, May 22, 2016. [Michalis Karagiannis | Reuters]

[central_va]

I’d hit it.

[SunkenCiv]

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[VRWCarea51]

I bet the hair on her legs and arm pits are just as long...

[yoe]

What are the Greeks doing to help themselves? Anything?

[PGR88]

Merkel and Brussels have achieved what Napolean and Hitler could not.

[TruthInThoughtWordAndDeed]

Greek should go the route of Iceland.

Bankruptcy.

Jail the bankers.

Start over.

[central_va]

Body hair has a bad rep for no reason.

[DeFault User]

Here's the man with the plan and the answer:

Just borrow more money.

[Buckeye McFrog]

The day is coming when debtor nations will link together to form a debt cartel.

Then they’ll get the bomb. It will be the New Cold War.

[steve86]

Looks to me like they’re making pretty substantial sacrifices. Did you not read/understand the excerpt?

[Opinionated Blowhard]

So the failed “bailout” (read: handout plan) forces “rescue” (read: a different handout plan) talk. All roads lead to a handout. Wouldn’t it be nice if the failed bailout forces spending cuts? Forces Greeks to live within their means? Forces Greeks to actually become productive in a sustainable Capitalist society?

[SunkenCiv]

;’)

[SunkenCiv]

They had a bout of killing foreign visitors (including tourists) about 20 years ago, and ultimately, they've got tourism and pensioner retirement condo/villa development as their best options. Agriculture has always been a bit of a struggle (something like 20 percent arable land; in Mycenaean times Orchomenos drained an entire lake to make farmland), and yes, they took the third world route to 'create' 'employment' -- inventing agencies and hiring bureaucrats. Meanwhile, any saps in European banks who actually took the word of the EU or Greece itself and extended credit are exposed. Of course, there are always socialists in all but name who want the victims jailed.

[WENDLE]

The great people of Britain have a chance to throw off this albatross next month!!

[Yo-Yo]

Give Greece the Summer Olympics on a permanent basis. Crisis solved.

[Mariner]

If the Greeks were smart and forward looking, they would JUST DEFAULT.

Make the EU kick them out of the Euro...or, not.

[OldNewYork]

Why does Greece expect their Christian neighbors to finance the way they live?

[867V309]

What are the Greeks doing to help themselves? Anything?

Their economy is dead. Any sign of life is immediately sucked out by paying interest on the bailout debt.

[SunkenCiv]

Luring retirees is probably more sound, that worked for Gozo (the smaller of the two big islands of the Republic of Malta), which was actively seeking pensioners 20 years ago (I was thinking about starting the process of buying a place there), and now the prices are whoop-dee-doo high. Retirees aren't demanding on the infrastructure (depending on how primitive it is when they get there) water supply etc, are quiet, don't riot (usually), and have cash and time to spend it. Greece is pretty scenic in the very places that can't be farmed, and has that "live where you vacation" panache that is rare in certain parts of the world ("yeah, I thought a retirement home in the Middle East made a lot of sense because I love archaeology and the cuisine.").

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