And the fact that really strong unions have written really detailed work rules means that the rest of their industry is mostly on its back as well. If you can't change the way tasks are done, you can't change. And without a cheap currency they can't hope to compete with the Germans.
And now that the bills are coming due, they say they can't pay half of what they owe, and the Greeks want the banks to accept a 50% "haircut." (That is Euro-speak for loss.) Of course when you look at what the Greeks are actually proposing the haircut isn't 50%, but actually closer to 70%. And since they lied to get into the Euro, and they lied when they said they would repay 100% of the balance PLUS interest, who is to say they aren't lying about being willing to pay anything.
The result of all this is that the creditors and the other countries currently bailing Greece out, want Greece to get its fiscal house in order. Things like actually collect taxes owed, not paying crazy salaries to government officials and bureaucrats, and in general cutting the insanity out of their lives.
The Washington Post is hand-wringing over the fact that now that the party has come to an end, things are hard.
ATHENS — Deeply indebted and nearly bankrupt, this Mediterranean nation was forced to adopt tough austerity measures to slash its deficit and secure an international bailout. But as Greece’s economy slides into free fall, critics are scanning the devastated landscape here and asking a probing question: Does austerity really work?Of course it is hard to know, because they haven't tried it yet. Greece has been dragging its feet for 2 years (or more).
In 2010 they signed up for some austerity to get bailouts in 2011. They still haven't enacted all the legislation, let alone enacted all the measures required for the 2010 agreement - and they are complaining about how unfair it is that they haven't gotten all of the money they were promised in 2011. And the 2010/2011 bailout is of course not enough. They need another 170 billion Euros, on top of stiffing their creditors for
Anyone who lends to the Greeks or any European country at this point should view the money more as a donation than an investment. They have demonstrated an ability to lie. They have demonstrated an ability to live high while producing little. And they have shown themselves willing to stiff anyone who owns a Greek bond.
And the Greek economy is in free-fall, in part, because they just can't compete. Their industry is stuck in the 70s. They killed tourism by adopting the Euro. They are screwed, but the fact that they did it to themselves seems lost on the WaPo. The fact that excessive government spending eventually leads to collapse is not something they want to contemplate. Offends their ideology.