Thoughts on the Greek Madness

National Review Online ^ | 6/16/2011 | VICTOR DAVIS HANSON

[mojito]

Anyone who has lived in Greece can see why the question of default or a “haircut” is not a matter of if, but when. It is a wonder that crazy things have lasted as long as they have there. The symptoms are well known: Tax evasion is now an art form and a matter of pride; pensions are absurd to the point of caricature; the public sector is self-righteous, bloated, and inefficient; and what little industry there is does not meet European standards of efficiency and productivity.

[....]

Finally, there is no way out except either sudden or gradual default because of the complex mentality of a xenophobic Greek public that assumes expansionary entitlements as an earned birthright and would treat any who would cut them as some sort of existential enemy. That narrative works out to something like a greedy predatory northern European or American bondholder wanting to pile up even more needless profits by enforcing quite unfair and amoral terms of payback on the courageous, brave, and long-suffering Greek collective.

Once a society descends into that mindset, there is little alternative but the get-real shock therapy of default, which, in the Greek case, would return it to something like the early 1970s when I first visited: a nonconvertible, widely fluctuating drachma, a standard of living more akin to the southern Balkans or western Turkey than France or the Netherlands, a vibrant black market in money exchanges, tight controls on the possession of foreign currencies and a curtailment of imported goods, and very little new infrastructure construction or repair.

[mojito]

Those whom the gods would destroy, they first make dependent on over-generous entitlements.

[Travis McGee]

America’s near future.

[Gator113]

We could soon see this on our own soil.

For America, the real catastrophe is that it never needed to come to this.

[hal ogen]

Germans...get to work! The Greeks need more money for day-long tea-sipping and early retirements in their 50’s. Ya...you work longer...and harder.

[PapaBear3625]

The solvent EU countries should forbid any bank of theirs making any sovereign loans to Greece, Portugal, Spain, etc.

All of a sudden, Greece cannot borrow money and cannot pay for any government beyond what current tax revenues will pay for.