Free Markets, Free People


The Greek tragedy (or socialism runs out of other people’s money)

And, of course, Greece isn’t the only country going through this at the moment, it is only the worst off of the bunch.   In fact, it is a case study in the end result of socialist programs (although you’d think, given its fairly recent collapse, that much could have been learned from the Soviet Union).   Greece has, for decades, piled up more and more debt than the other European socialist countries and, with the global economic downturn, was the first of the Euro zone to hit the shoals of bankruptcy – although Europe is doing everything it can to forestall that.

The problem is that socialism and its benefits (whether they’re affordable or not) are like being hooked on heroin.  Even if you know you have too, you just can’t seem to get off the stuff.   Addicts deny reality, fight the cure because it is horribly painful and thus somehow come to believe they can continue to survive on the drug as they have before.   And it slowly and inexorably kills them.

Greece, if it isn’t able to kick the habit, is on its economic death bed.  Europe understands this and also sees the possibility that Greece’s inability to break this habit, i.e. pass and impose austerity measure – draconian austerity measures – might also mean the death of Europe’s currency, the Euro and conceivably the break up of the European union.

That’s how serious it is.

But the addict continues to fight the cure.  Led by the two major unions, Greece has been shut down for 2 days as protesters vent their spleen about the unacceptability of these austerity measures.   The irony, of course, is the measures are being imposed by a socialist government which has been given no choice but to impose such measures.

However, that government is seen as week and socialist members who supported the measures at first are now opposing them.

But the austerity program has met with resistance from within the ranks of Mr. Papandreou’s own party, especially over the privatization of state companies whose workers have traditionally been at the heart of the Socialists’ constituency.

As many as four Socialists in Parliament have said they will consider opposing the measures, including one who opposes the planned privatization of the water utility of Thessaloniki, in her district.

Another Socialist, Alexandros Athanasiadis, said he would vote against the plan to reduce the state’s stake in the Public Power Company to 34 percent from 51 percent. Some of the company’s coal-burning plants are in his district in northeastern Greece.

Naturally the socialists oppose privatization because, you know, the government has done such a bang up job to this point of running businesses it has no business being involved in.  Why?  Because the government, and therefore the parliamentary members, control the jobs, pay and pensions.   More heroin.  As government gets more involved in areas it has no business and it (those who run it) begin to understand the power such intrusion brings them, they’re loathe to give it up, even when they’re doing a horrible, inefficient and costly job that could be better and more cheaply done by private industry.

The symbiotic relationship between the unions and the MPs is mutually beneficial and ensures an incumbent who properly plays the game (support union demands) remains in power (see public sector unions and Democrats here).  That, of course, has led to unaffordable pensions, wages which aren’t competitive and a public stuck with the ever increasing bill.

Well, the bill has come due.

On Monday, Mr. Venizelos, a Socialist veteran known for his ability to rally his troops, told lawmakers that the measures might be “tough and even unfair” but that they were unavoidable. “We have to finally come to our senses and get serious,” he said.

With 2 days of protests, one has to wonder whether indeed the Greeks are going to actually come to their senses and get serious”, because if they don’t the repercussions could be devastating.

And knowing all of that, and looking at our debt problems, one also has to wonder why we seem bent on creating an addiction of our own, given the real world examples of where that must eventually lead.

It makes absolutely no sense, does it?

~McQ

Twitter: @McQandO

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3 Responses to The Greek tragedy (or socialism runs out of other people’s money)

  • The Gods of the Copybook Headings are just old white men from, like, more than a hundred years ago.
    Besides, deficits are an investment!

  • Michael Lewis has a phenomenal article on this.  It’s not just the government, it’s also the people…

    http://www.vanityfair.com/business/features/2010/10/greeks-bearing-bonds-201010

  • And knowing all of that, and looking at our debt problems, one also has to wonder why we seem bent on creating an addiction of our own, given the real world examples of where that must eventually lead.
    It makes absolutely no sense, does it?

    >>>> It does when you consider that the people doing it now are planning to be safely out of power when absolute push comes to absolute shove……or even more accurate, plan to turn the mob on “the rich” or “big (fill in the blank) as the culprit.

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