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Greece is a country in south-eastern Europe, spanning across a peninsula and an island group on the northern edge of the Mediterranean sea. Because of its long history and the influence of its early culture on later civilizations, it is often regarded as the cradle of our current society.
The Greek language uses an alphabet that gave the world π (They seem to be the only ones who see a need to use a capital Π, which sadly gets ignored by users of other writing systems. It does, however, find use in mathematics, where capital pi notation, similar to the sigma notation used for series of summation, is used to simplify the presentation of the product of a sequence of values).
Ancient Greece covered the same area as Modern Greece, as well as parts of Macedonia, Turkey, Italy and the shores of the Black Sea. The earliest work in what can be regarded as the Western literature is Homer's Iliad, an epic poem detailing a war between several city-states which was written circa 700 BCE but based on an oral tradition several hundred years older. They had an exciting and fun religion which was later copied by the Romans, as was much of Greek culture in general.
Ancient Greece was also home of many of the most famous philosophers in history, including Socrates, Plato and Aristotle and some of the great mathematicians, such as Eratosthenes, Euclid, and Archimedes. In fact, the ancient Greeks regarded all mathematics as geometry, a term which literally means measuring the Earth.
Tell that to the Flat Earthers . Aristotle's pupil Alexander the Great conquered most of the Middle East, spreading Greek culture and language as far as India and Egypt.
The city-state of Athens was one of the earliest democratic states in the world and had great influence on later political theory, but only for a couple centuries, and ancient Greece, including Athens, also included tyrannies (not necessarily as bad as it sounds, but basically a form of autocracy and thus dependent on the autocrat in question), oligarchies and the unique Spartan model where oligarchy was intertwined with monarchy and a hint of "juntaism".
“”Fuck your parliament and your constitution. America is an elephant. Cyprus is a flea. Greece is a flea. If these two fellows continue itching the elephant they may just get whacked by the elephant's trunk, whacked good.
|—Lyndon B. Johnson to the Greek Ambassador in 1965., Harold pinter, House of Commons speech, October 2002|
Two years later, the Greek Colonels' fascist junta took over the country. Democracy prevailed from 1974 onwards, with a referendum resulting in the abolition of the pre-junta monarchy. Socialists and conservative parties swapping government and opposition in the usual manner, apart from one unusual period in 1989, when a coalition of Conservative and Communist parties ran the place for a while to keep out the Socialists. The junta fell as a result of a failed attempt at establishing a puppet regime in Cyprus.
Greece and Turkey are both NATO, which poses an interesting legal question of what happens when one NATO country strikes at another. Which one is NATO to support? In theory, Turkey would be obligated to defend Greece against an attack from Turkey. It opens a whole other can of worms with the EU, as well. (For decades Turkey has been engaging in this kind of macho diplomacy with Greece. It's strange to see them using it on the international field; they probably don't realize how ridiculous it sounds.)
2010-15 sovereign debt crisis
“”I'm the Finance Minister of a bankrupt country.
Greece today is part of the European Union - not that it's helping much; the country's going bust while France and Germany bicker about what to do. The weird thing about the IMF is their split-personality disorder. This comes about because their "research" arm is stacked with people who do some decent econometrics. This was especially noticeable during in the Greek crisis: They have a lot of data people there who were pointng out the obvious, namely that austerity had failed and it would be impossible to ever get the money back from Greece. The IMF Chief wants to wash her hands of Greece and coerce Europe into more generous debt restructuring measures (though she would never say it explicitly). She's being ignored, of course.
Although Greece is being helped out by the IMF it is not clear how much they can do. IMF help is usually accompanied by recommendations that the country cut spending and stimulate its economy. While the "cut spending" instruction is being carried out with some vigour (apparently) the second leg is more problematic. The possible means of economic stimulation are:
- Reduce interest rates. This is doubly impossible for Greece. Firstly because interest rates are already at rock bottom, and secondly because as a member of the Eurozone, its interest rates are set by the ECB anyway.
- Devalue its currency. Also impossible as it is a member of the Eurozone.
Although not usually an IMF recommendation, another way to stimulate an economy is through simply printing money (AKA quantitative easing) - but again Greece's membership of the Eurozone prevents this, too.
Consequently world markets think the IMF-imposed cuts will drive the economy into recession and increase unemployment (and associated costs) without giving the Greek government any opportunity to improve its income and pay off its debts. Pretty much it boils down to the Greeks' inability to realize that in order to have good social benefits, you'll need taxes to pay for them. (Also, don't call your creditors Nazis and Terrorists, it might dampen the mood.) There are also many people who fail to understand how high the taxes actually are in Greece (they could reach 60% in certain cases), at least for those who pay them, due to the relatively high tax evasion in Greece. After only three years from the beginning of the programs established by the Eurozone countries and the IMF, the situation started to reverse: the economy stopped shrinking and the unemployment stopped rising, as well as the public debt-to-GDP ratio. Despite the enormous investement made by Eurozone taxpayers into the Greek public budget (which by 2017 reached a total of approximately 220 billion euros, 110% of the Greek GDP), the situation of the country remains difficult, with both a debt-to-GDP ratio of about 180% and a real GDP per capita at the same level of 2000. On a positive note, the creation by the Eurozone countries of a permanent international mechanism to sustain financially troubled governments (the European Stability Mechanism) and the extreme resilience shown by the Greek people during the years of hardship, indicate that the situation will continue to improve, even if slowly, and as far as the Greek finances and economy are concerned.
- Greek Communist in a Key Cabinet Post
- Meheen, Khan, "Varoufakis: 'I'm the Finance Minister of a Bankrupt Country'", Telegraph (4 February 2015, 3:00PM GMT).
- Euro continues to fall as EU fails to agree Greece rescue plan
- Spiegel, Peter, "IMF criticises Greece bailout deal with EU", FT 15 July 2015.
- "Update of IMF Staff Preliminary Public Debt Sustainability Analysis", IMF Country Report No.15/186 14 July 2015.
- "IMF's Lagarde offers euro zone Greek debt compromise, Handelsblatt says", Reuters (5 June 2017, 10:05 AM).
- Foster, Peter, "German finance minister 'admitted he would not sign Greek austerity deal' if traded places, claims Yanis Varoufakis", Telegraph (28 April 2017, 9:00pm).
- What's behind the Greek debt crisis?