The Greeks — Do They Want To Be Saved? Or Not?

Source: Decline of the Empire

In this week’s episode of As The World Turns, European edition, German chancellor Angela Merkel, French President Nicolas Sarkozy and the ECB finally come to an agreement for bailing out Greece, only to find that Greek president George Papandreous, without telling them beforehand, had decided to hold a referendum on the deal which won’t take place until January, 2012! All hell breaks loose.

I made a conscious decision some time ago to leave the European Debt Crisis alone. In a life riddled with painful mistakes, maladaptation, and bad luck, this turned out to be one of the wiser decisions I’ve ever made. That conclusion was born out again yesterday when internal Greek politics upended an EU bail-out plan meant to make the already austere Greeks whole someday in a far off, no doubt imaginary future.

Nobody seems to see the humor in this debacle, but I think it’s hilarious, this endless joke that keeps on giving. For example, this last agreement included a 50% voluntary haircut for Greek bondholders which gave a whole new meaning to the word “voluntary”. Here’s the Reuters report on the latest of episode of As The World Turns.

(Reuters) – Greek Prime Minister George Papandreou said on Wednesday he would push ahead with a referendum on an EU bailout deal, defying demands from lawmakers of his own party that he quit for jeopardizing Greek membership of the euro…

The euro and global stocks were   on  pummeled on financial markets on Tuesday after Papandreou’s move threw into question the survival of crucial efforts to contain the euro zone’s sovereign debt crisis.

The leaders of France and Germany, caught unawares by Papandreou’s high-stakes gamble, summoned him to crisis talks in Cannes on Wednesday to push, before a summit of the G20 major world economies, for quick implementation of the bailout deal…

Sweden’s foreign minister, Carl Bildt, sounded bewildered. “It’s difficult to see what the referendum is going to be about. ‘Do we want to be saved or not?’ Is that the question?”

Bipolar traders on the American stock market lost their grip earlier this week, with Dow dropping 4.7% and the S&P 500 falling 5.2% over the last two trading days. It marked the index’s worst start in the month of November since 1932, according to Howard Silverblatt, S&P’s senior index analyst. These losses erased most of the gains made last week when traders were bullish on the Greek deal. Traders are puppets dancing on the end of a perpetual motion string.

And what about the Greeks themselves? This quote from Michael Lewis’ Beware Of Greeks Bearing Bonds should make that situation clear. Everybody on Earth needs to read this.

As it turned out, what the Greeks wanted to do, once the lights went out and they were alone in the dark with a pile of borrowed money, was turn their government into a piñata stuffed with fantastic sums and give as many citizens as possible a whack at it.

In just the past decade the wage bill of the Greek public sector has doubled, in real terms—and that number doesn’t take into account the bribes collected by public officials.

[Greek president George Papandreou, left]

The average government job pays almost three times the average private-sector job. The national railroad has annual revenues of 100 million euros against an annual wage bill of 400 million, plus 300 million euros in other expenses. The average state railroad employee earns 65,000 euros a year. Twenty years ago a successful businessman turned minister of finance named Stefanos Manos pointed out that it would be cheaper to put all Greece’s rail passengers into taxicabs: it’s still true. “We have a railroad company which is bankrupt beyond comprehension,” Manos put it to me. “And yet there isn’t a single private company in Greece with that kind of average pay.”

The Greek public-school system is the site of breathtaking inefficiency: one of the lowest-ranked systems in Europe, it nonetheless employs four times as many teachers per pupil as the highest-ranked, Finland’s. Greeks who send their children to public schools simply assume that they will need to hire private tutors to make sure they actually learn something.

There are three government-owned defense companies: together they have billions of euros in debts, and mounting losses.

The retirement age for Greek jobs classified as “arduous” is as early as 55 for men and 50 for women. As this is also the moment when the state begins to shovel out generous pensions, more than 600 Greek professions somehow managed to get themselves classified as arduous: hairdressers, radio announcers, waiters, musicians, and on and on and on.

The Greek public health-care system spends far more on supplies than the European average—and it is not uncommon, several Greeks tell me, to see nurses and doctors leaving the job with their arms filled with paper towels and diapers and whatever else they can plunder from the supply closets.

Where waste ends and theft begins almost doesn’t matter; the one masks and thus enables the other. It’s simply assumed, for instance, that anyone who is working for the government is meant to be bribed. People who go to public health clinics assume they will need to bribe doctors to actually take care of them. Government ministers who have spent their lives in public service emerge from office able to afford multi-million-dollar mansions and two or three country homes.

The birthplace of Democracy! Greece is not a country, it’s a clusterfuck. Freeloading run wild. When I hear about how the Greeks arwe suffering heavily under the new austerity, I remember Lewis’ Vanity Fair article.

It will never, ever end because the Human Comedy never, ever ends. And we still have Portugal, Italy and Spain waiting in the wings, ready to take centerstage. Bond rates for all of these countries are going through the roof. Will the EU hold together? Will the Euro survive? What about the French and German banks? These are among the many momentous questions to be answered (or not) in the coming years. (Decades? Centuries? Millenia?)

Stay tuned for the next juicy episode of As The World Turns, European edition.

Bonus Video — From the Daily Ticker’s Update: Dow Down 297 as Greek Shocker Sends Markets Tumbling

Read more at Decline of the Empire