"No to Austerity" wins greek Referendum with 61% of the votes

[MonsterMum 2,532]

Can someone explain to me how Greece got to this point and what 'Yes' and 'No' will mean for Greece? I only have basic info. on this but I'm not very informed on it. 

I fould this article pretty good read

http://www.dailymail.co.uk/news/article-3149640/Mimi-Big-T-s-buffoon-leaders-milked-EU-Taki-Theodoracopulos-veteran-Greek-commentator-spectator-columnist.html

[Azor Ahai 18,861]

Can someone explain to me how Greece got to this point and what 'Yes' and 'No' will mean for Greece? I only have basic info. on this but I'm not very informed on it. 

30 years of corrupt goverments that kept borrowing from Europe but spend the money on themselves.

"No" means Greece does not accept Europe's new conditions while "Yes" means the opossite.

In case of "No", Eurogroup will try to make another deal with Greece or in the extreme and highly unlikely condition Greece will leave the Eurozone and is fxcked.

In case of "yes", well the conditions are applied and Greece stays in Eurozone but is fcked too.

 

WARNING: I'm 16 , I only know this from TV and internet articles .

[iAstroLeo 14,452]

If it is a 'No' vote they have made the best decision. Austerity doesn't work. Look at Britain  

Really? Where is a bankrupt country supposed to get money from? Trees?

[MonsterMum 2,532]

Reuters Top News ‏@Reuters  14 min.

BREAKING: German Vice Chancellor Gabriel - Tsipras has torn down last bridge of compromise. #GreeceReferendum #GreekCrisis

[Better Day 5,766]

Really? Where is a bankrupt country supposed to get money from? Trees?

you need to spend money to make money

[iAstroLeo 14,452]

you need to spend money to make money

But to spend money, you need to get money from cuts.

[MonsterMum 2,532]

you need to spend money to make money

Running a country is like running a household, if you spend more money then you make you are in danger. If you keep filling a small hole with a bigger hole you will fall through it one day.

For Greece it went good for a long time till the financial crisis hit and the skeletons just came falling out of the closet leading to this mess. All of the sudden the real figures were out on what they spend and how big the corruption is and now it's too late to turn that tide. Now, the most severe hit are the regular people not the ones that were dodging the taxes in the first place.

[Better Day 5,766]

Running a country is like running a household, if you spend more money then you make you are in danger. If you keep filling a small hole with a bigger hole you will fall through it one day.

For Greece it went good for a long time till the financial crisis hit and the skeletons just came falling out of the closet leading to this mess. All of the sudden the real figures were out on what they spend and how big the corruption is and now it's too late to turn that tide. Now, the most severe hit are the regular people not the ones that were dodging the taxes in the first place.

If a country is falling down. They need to take on debt to pay for vital services like welfare to ensure the country as a suitable work force so they can produce the goods needed in order for money to be made. If the country's workforce is at a good standard then they can produce more theregore more money to pay off the debt, provide vital services.

 

However, those businesses not paying their share of tax bankrupts the country because the greedy business owners just want money. They need to pay large amount of tax so the country can divide it amongst the citizens to ensure a suitable work-force

[faux 2,190]

Greece always awed me as a country but lately it seems really dumb and filled with brainless people.  Don't wanna drag or, in general, insult anyone, but it's just the way I think lately. Don't take me seriously, please. 

[Azor Ahai 18,861]

Greece always awed me as a country but lately it seems really dumb and filled with brainless people.  Don't wanna drag or, in general, insult anyone, but it's just the way I think lately. Don't take me seriously, please. 

You're talking about a whole nation  

[Luc 4,776]

Can someone explain to me how Greece got to this point and what 'Yes' and 'No' will mean for Greece? I only have basic info. on this but I'm not very informed on it. 

Basically, we don't really know what will happen. All we know is that worldwide all exchanges will go down a lot.

Greece has suffered from incompetent governments for a way too long while.

Examples:

Christine Lagarda (former French finance minister) handed over a list of Swiss tax evadors to the prime minister of Greece in 2010, but that list was 'lost'. It was later retrieved, and then the family members of the Prime Minister were removed  and they did nothing with the tax evadors.

Pensions in Greece used to be from about 57 years old (lower for people who worked in the government. There was even a rule that unmarried daughters of fathers who were in the military can always earn pensions) and used to be 80-90% of your final income with 13th and 14th months: the rich people worked about 30 years for a pension of over €40000 a year.

Government officials were extremely unnecessary and more of a way to win elections than because they were actually needed: estimations said that about 2 in 3 government officials were unnecessary and could be fired.

Exports are extremely weak. Year after year Greece has imported way more than it has exported: that means that a lot of the money spent in Greece flows to the rest of the world, not returning to Greece.

Tax evasion is extremely high. The amount of money on banks owned by Greeks in Switzerland is about 2-3 times higher than the money owned by Greeks on Greek banks. There's also many tax exemptions and such making it easy to evade.

 

Now Greece has an extremely high debt and the economy shrunk 25% in the past few years. It's comparable to the Great Depression in the US, except that in Greece they can't do it Keynes-style because they already have a very high debt.

They voted on a packet of austerity, made together by the Greek government and the creditors. This included raising the pension age to 67, highering tax on yachts from 10% to 13%, removing tax exceptions, highering VAT on most products, removing VAT exceptions for tourist islands, cuts on military, more money paid for healthcare by elderly, no free expensive medicines and raising the corporate tax from 26% to 28%. For this a referendum was held, and Greeks voted no in a big majority.

What this will lead to? Greece needs money to pay back the IMF, ECB, EFSF and private investors. Greece can only get this money from the rest of the Eurozone, but the rest of the Eurozone wants Greece to get their finances to be on point in exchange for that (austerity). Greeks voted against this, and this could possibly lead to Greece leaving the Eurozone, the EU and NATO in the worst case.

[Luc 4,776]

you need to spend money to make money

That's not necessary. In times of a crisis it's better to spend a little bit more, but not all sorts of austerity hurts the economy. A wealth tax and heritage tax doesn't make the buying power of people lower in the short term. But firing government officials, highering taxes on income and consumption will in the short term lead to an economic crisis being worsened. We're not in times that we can achieve growth of 5%+ anymore, though, so taking on a high debt is extremely dangerous considering you can hardly pay it back.

[faux 2,190]

You're talking about a whole nation  

I know I'm being an asshole

[Computer 10,980]

Really? Where is a bankrupt country supposed to get money from? Trees?

Technically yes, trees.  In United States that's where we get the paper for our money (along with cotton and other plants/fibers), and we can make as much as we want.

--

It's not without consequences but the ability to control one's own monetary policy and specifically to print more money when absolutely needed is a basic economic tool that all Euro member states are lacking by committing to use the Euro.

For example if the United States gets into too much debt (which we did) our Federal Reserve can purchase infinite Treasury bonds to fund our government in dollars (which we did)... the effect is inflation and a reduction in value of existing debts.  It therefore reduces the value of our currency but it solves any problem on our own terms.

Greece can't do that with Euros.  If they become completely indepedent as a result of this and begin printing drachmas I would applaud them as it would be an acceptance of both the benefits and consequences of running their own economy - something I assume every sovereign nation would want to do.

[Bat 6,162]

Sad day for Europe