In some countries tax evasion is a national pastime and everyone who can follows the lead of the rich business class by obfuscating their incomes. One central plank of the EU is the harmonisation of tax collection with every citizen of every member state paying their share. There was a major failure to do the due diligence regarding that when Greece joined the Eurozone. That's what the Germans are trying to rectify now. That points to the answer to some of points above -NickFaulks wrote:I think it's fair to assume that the present Greek leadership doesn't have much time for them either.David Pardoe wrote: I do have concerns about the tax dodgers in Greece...a super rich class who live outside the norms and seem to be untouchable...
Brian Towers>What has emerged over the last few days is that the Greek people want to stay in the Euro. This was a surprise to me but then I thought the sensible route for them would have been to go down the Iceland route 4 years ago and default. I can't see or understand how they are better off today for not doing that.<
The ordinary Greek people want to stay in the euro because many of them have managed to salt away - literally under the bed - a stack of physical euros (identifiable as Greek) and if they leave the Eurozone those euros will lose most of their value when converted to a new Greek national currency. The Icelanders didn't have that choice because they were never in the euro and their national currency simply devalued automatically (but their government compensated them for that!)
Brian Towers>What has also been clarified is that the EU officials are not going to compromise. They have said that whatever the referendum is about it is not about what is written on the ballot paper (accept or reject the latest offer from the EU) because that offer has expired and is no longer on offer. Instead they say that a "Yes" vote means stay in the Euro and a "No" means exit the Euro. Again I don't really understand. Most of the debt, as far as I know, has been transferred from European banks (mostly French and German) to Eurozone institutions like the ECB and the IMF.<
Yes, that's correct but to understand it all you have to do is recognise that for the Germans the Greek 'Yes/No' referendum outcome amounts to the following - if the majority of the Greeks vote 'Yes' then the Germans continue to bankroll them BUT their price is a transformation of the Greek economic and political system into a Teutonic-style one where everyone shoulders their responsibilities by adopting the Puritan work ethic and coughs up their taxes. If the majority of Greeks vote 'No', and continue to slack off, then the Germans will take most of the financial hit through the Greek ECB debts not being repaid BUT they can then wash their hands of Greek debt. This crisis is now about the strongest link in the Eurozone, Germany, either strengthening the weakest link, Greece, or removing it from the chain if the cost is too high.
[NB: The IMF is not a Eurozone institution it is an international one that the UK contributes to and that shortens the 'bargepole' between Greece and the UK.]
Angus French>IMF says Greece needs extra €50bn in funds and debt relief. This looks like it could be an important development. The IMF's position is now different to that of fellow troika partners, the European Commission and European Central Bank.<
Last I heard the amount the IMF thinks Greece needs has risen to 55bn euros and the difference in their position is that they think that money should be found within the EU's coffers - which means most of it will be German money - they don't seem to be offering any of it themselves - probably because the Greeks just failed to repay them a 1.6bn euro tranche of debt.
David Pardoe>To make the Euro concept work, you need a two speed currency..ie, Euro Mk 1 & Mk2 in my view.<
A Protestant Euro - the Peuro? - for Northern Europe and a Catholic Euro - the Ceuro? - for Southern Europe?
David Pardoe>As for the Greek outcome, one point I`m curious about is that it was said that an agreement was `close` at one point..<
In this case the word 'close' is relative - relative to German and Greek positions, so as it gets closer to one it gets further away from the other. What the protagonists need to do is get out of their trenches to meet in no man's land (that's somewhere between Athens and Berlin) - and not just for a game of soccer.