C&B Notes

‘There’s No More Left to Cut’

Greece and its people are caught between a rock and a hard place. Through debt default/restructuring and austerity, the country is basically hitting the reset button by rolling back jobs, wages, and health and retirement benefits that were unsustainable.  Operating with a margin of safety (in a government’s case, avoiding long-term spending that is beyond its means) prevents terrible outcomes in situations well beyond investing:

“That’s enough, we can’t take it anymore.” That was the popular chant coming from protesters in Athens yesterday during the latest 24-hour general strike against the country’s austerity measures.  Teachers and doctors joined bank employees to demonstrate against a new round of expected cuts as the cash-strapped country continued to negotiate new reductions in spending to help keep the economy afloat.

Several thousand demonstrators from the public and private-sector unions braved the heavy rainfall, gathering outside Parliament to voice their opposition at the latest proposed measures to secure a €130bn (£108bn) bailout package.  Minor clashes broke out when protesters tried to remove a cordon near the parliament building.  Police sprayed tear gas and at times clashed with strikers, whose anger intensified overnight when a further 15,000 job cuts were announced.

Since the onset of the crisis, the austerity drive has sent unemployment to a record high of 18.2 per cent and the country’s finances into a spiral of recession.  Despite the deepening pain, crowds at protests have increasingly dwindled.  “People are scared and haven’t really realized what’s happening yet,” George Pantsios, an electrician for the country’s public power corporation, said.  He has only been receiving half of his €850 monthly wage since August.  “But once we all lose our jobs and can’t feed our kids, that’s when it’ll go boom and we’ll turn into Tahrir Square.”


The conservative daily Kathimerini newspaper’s headline said: “Merkel and Sarkozy’s asphyxiating pressure.”  It was a reference to lenders’ demands to axe another 15,000 civil servants by the end of the year and cut the minimum wage by 20 percent.

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