Skip to main content

world wide wednesdays :: all hellene breaks loose

in case you've been held prisoner by american news coverage for the last week, it behooves me to tell you that the rest of the world has not been overly occupied with northeasters or remote control toys on the white house lawn. it's not that those aren't news, it's just that they're not the only news. for instance, a lot of people have been more interested in the fact that greece, the country that brought us the term "austerity financing", just elected a communist/ socialist government who could implode the european union. given that the e.u. is the largest controller of wealth in the entire world [about 30% of all global wealth is owned or managed by e.u. member states], its collapse, or at least destabilization, has the potential to wreak some pretty major havoc.

part of the problem of covering this, of course, is that talking about the 2015 greek election on its own is like starting the story of the lord of the rings with the bit where frodo is about to throw the ring into the pit of mount doom. it makes for an interesting scene, but it's sort of difficult to evaluate if you don't know what's gone on before.

a lot of people did hear about the greek government's flirtation with economic collapse back in 2009-10. the story in most of the media was that greece had apparently not been doing any kind of work for several years, but they had been maintaining social programs that took care of people. i wish i were joking about how simplistic and biased media coverage was when it came to the greek financial situation, but allow me to share with you the first line of the first article that comes up when you [or at least i] google "explanation for greek economic recession":

The financial crisis that has crippled the Greek economy serves as a cautionary tale against irresponsible spending. source

it's certainly true that there is an object lesson in what to avoid if you want to run a national economy when you look at greece. one of the top learnings might be "don't lie about how much you're actually spending versus how much you're bringing in when you're part of a multi-national currency group". because it's clear that the greek government did fudge their numbers to make the country look like a better investment than it actually was. 

of course, lots of countries do that. lots. of countries. and the fact is that, in most cases, agencies like the i.m.f. make a show of getting all huffy about it when the blandishments become untenable and the offending government [whether or not they were the ones who were actually responsible for cooking the books, but that's another story] goes back and plays with the numbers and comes up with a way for everyone to be happy. a lot of the time, that involves the government agreeing to devalue its currency. argentina, often lauded as one of the rising star economies on the global scale, has devalued its currency multiple times in order to force a correction to its books. [people who would be inclined to sell a country's currency because it is dropping in value against a baseline such as the u.s. dollar are dissuaded from doing so because suddenly that currency can't be exchanged for the amount of baseline money they thought. since most countries use their foreign cash reserves as a combination investment bargaining chip and a rainy day fund, this measure stops the bleeding. although it's really like forcing the bleeding to become internal.] [side note :: i should say that argentina was lauded as a strong emerging economy, up until their current president started doing things like nationalizing resources and industries and redistributing their wealth among argentinians. the country has gotten a lot less popular as an investment opportunity since then.]

but greece never had that option, because no one country can just devalue the euro to take the pressure off. and before you point out that devaluing currency is a kind of a cheat anyway, please take note of what i said above: it happens all the time. it's all well and good to say that something is bending the rules, but if you never enforce those particular rules, it's hard to blame the people doing the bending. 

the other thing that is not widely acknowledged is that a key reason for greece's revenue shortfall is that greece has a tax evasion problem. a massive tax evasion problem. it's estimated that greece loses thirty billion euros a year in unpaid taxes. 30 billion a year pays for a hell of a lot of public services and, indeed makes a big difference on the books [which in turn makes one wonder the extent to which the cooking of greek books reflected estimated versus actual tax revenues]. cracking down on this problem has been a touchy issue, since high-profile citizens like prime minister antonis samaras, the man who was earlier this week unseated by baby-faced alexis tsipras and his "radical leftist" coalition, were supposedly among those implicated. reporter kostas vaxevanis was arrested in 2012 for publishing the so-called "lagarde list", a list of nearly two thousand greek nationals who were squirreling away money in swiss bank accounts handed over to the greek government in 2010 by france's then finance minister christine lagarde. he was later acquitted, but consider the optics of the situation: faced with a report of thousands of wealthy greeks avoiding taxes, the response of the samaras government was to arrest the journalist who published their names. 

the tax avoidance problem is laughed off [if it's mentioned at all] as a part of the terminally corrupt greek political system, but it's worth noting that the austerity plan imposed on greece as a condition of even moderate financial assistance never contained any requirement for tax reform or the closing of loopholes that allowed corruption to occur. instead, it focused on reducing the number of public agencies by two thirds, taxing pensions, raising the retirement age, raising property values [which would in turn increase the taxes owed on those properties by greeks who owned them], and raising the valued-added tax [sales tax, which is paid equally by everyone, regardless of income]. thus, the brunt of the austerity measures was borne by the poor and middle class. in case you were wondering why the people would be willing to take a chance on a radical left-wing government, the answer may well be "how much worse could it realistically get?" [side note :: the issue of corruption and tax evasion in greece may have deeper roots than it appears. when the ottoman empire ruled the country, up until the greeks successfully waged a war of independence in 1821, cheating on taxes was seen as an act of patriotism- refusing the imperial overlords their due. as such, it was something that was tacitly approved by greeks tasked with collecting taxes on behalf of the empire, who would happily accept a "little envelope" to look the other way and fudge their numbers a little, as long as the result was that more greek money stayed in greek hands.]

the current result of all this is that greece and the european community are about to engage in a fairly high stakes game of chicken. what the e.c. but as anyone who has ever gone looking for food after a night of drinking and carousing can tell you: greeks are really good at chicken

in this non-food version, consider the options: 
  • the entire debate on how much and when greece will repay is to do with money that's already been invested/ received/ spent. no one is offering greece the promise of greater assistance [and, in fact, they have never really offered much, other than when it became obvious that the government was going to collapse under public pressure], so the idea that greece has something to lose in the future by unilaterally changing the terms of its debt payments is facile. 
  • the "big stick" wielded against greece is that, if it were to reduce its debt payments, foreign investors could easily collapse the country's central banking system by withdrawing money from it. that sounds like a very big stick until you consider the effect on the european union as a whole if investors were to collapse the banking system of one of their member states. aside from the fact that it would seem to be a de facto coup against democracy [the people elected this government, after all, and came close to handing them an outright majority, which is comparatively rare in multi-party europe]  
  • if greece were to be expelled [or to leave on their own initiative, which is not beyond the realm of possibility under the current government] from the european union, it sets a potentially dangerous precendent: once the union is broken once, it becomes clear to everyone that it is not inviolable. reactions against enforced austerity raise the possiblity that countries like spain and portugal could choose to withdraw, reclaiming control of their national economy. [side note :: it is ironic that the deciding factor in how central europe reacts to greece might well be determined by how likely another european country is to follow their example. there are many who might choose to split, but by far the biggest player is spain. as troubled as their economic management has been, they are a huge economy- the fourth largest within the eurozone- and, were they to start making serious noises about withdrawing from the union, it's likely that the whole system would fall apart. there is already plenty of skepticism about the benefits of european membership within the country, especially since regions that have been less willing to enforce austerity measures, like the basque territories, have performed better economically than those who have embraced "the new reality".]
  • finally, it's questionable how much foreign investors will even care about any changes that the new government makes. slashing debt repayments will make a massive difference to greece, but either way, the payments are a pittance to most of the country's creditors, especially if you take the eurozone and the i.m.f. out of the equation. the difference between payments being maintained at their current levels and being cut in half or greater is astonishingly small if you're anyone except the greeks. by that measure, it's unlikely that investors are likely to push europe to employ a hard line. because that's the difference between getting some money and getting no money, which will ultimately be about pride and principle rather than economic necessity. 

i've no idea where the current greek experiment will end up. i tend to think that it will work reasonably well for them, if for no other reason than those against whom they have stood their ground has any self-interest in making things otherwise. the more relaxed, the more friendly and the more quiet everyone can keep things in greece, the better it will be for the status quo everywhere else. of course, that puts all the power in the hands of greece's newly elected government. that's where things get really interesting.  
The financial crisis that has crippled the Greek economy serves as a cautionary tale against irresponsible spending. - See more at:
The financial crisis that has crippled the Greek economy serves as a cautionary tale against irresponsible spending. - See more at:
The financial crisis that has crippled the Greek economy serves as a cautionary tale against irresponsible spending. - See more at:


as long as you're here, why not read more?


i keep seeing this ad for tictac candies:

am i the only one who finds the suicide bomber clown at the end a little unnerving? all the nice natural things like the bunny and the [extinct] woolly mammoth and the fruit get devoured by a trying-to-appear-nonthreatening-but-obviously-psychotic clown who then blows himself up. congratulations, tictac, i think this ad has landed you on about a dozen watch lists.

oh and by the way, showing me that your product will somehow cause my stomach to explode in a rainbow of wtf makes me believe that doing consuming tictacs would be a worse dietary decision than the time i ate two raw eggs and a half a bottle of hot sauce on a dare.

making faces :: hot stuff, comin' through

i don't even know what to say about the weather. the end of september saw temperatures at a scalding 36c/ 97f outside. this is especially annoying because we've had a moderate summer. most days it rained a little in the morning, the temperatures didn't creep into the 30s too often and there wasn't the normal stretch of a few weeks when it felt like we were living on the sun. now, we've receded into more normal fall weather, although it's still on the warm side for mid-october. that climate change thing is a bitch.

trying to think of something positive in the situation, it does put me in a perfect frame of mind to write about urban decay's naked heat palette. it's the latest in what appears to be an endless series of warm neutral and red eyeshadow palettes that have followed in the footsteps of anastasia's modern renaissance. [which i ultimately decided i didn't need after doing a thorough search of my considerable stash.] i do think that it'…

i agree, smedley [or, smokers totally saved our planet in 1983]

so this conversation happened [via text, so i have evidence and possibly so does the canadian government and the nsa].

dom and i were trying to settle our mutual nerves about tomorrow night's conversion screening, remembering that we've made a fine little film that people should see. which is just about exactly what dom had said when i responded thusly:

me :: i agree smedley. [pauses for a moment] did you get that here?

dom :: no?

me :: the aliens who were looking at earth and then decided it wasn't worth bothering with because people smoked even though it was bad for them?
come to think of it, that might mean that smokers prevented an alien invasion in the seventies.

dom :: what ?!?!?

me :: i've had wine and very little food. [pause] but the alien thing was real. [pause.] well, real on tv.

dom :: please eat something.

of course, i was wrong. the ad in question ran in 1983. this is the part where i would triumphantly embed the ad from youtube, except that the governmen…