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Old 20.06.2012, 21:02
photonion photonion is offline
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Re: How long does the Euro have left?

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10,000 a month even for a tanker captain seems quite high unless we are talking about highly experienced ones of course. The is a high end salary for the profession.
That's why I was referring to this extreme example, just to make clear that 5000 Euros per month is simply impossible for a ferry captain. Such salary cannot exist. And, yes, I was talking about extremely experienced captains (45+, crossed the world more times than they care to remember... very interesting guys to talk to actually...)

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But anyway, this is exactly what I've been reading in the reporting. I've never read that 'everyone in the whole country is being overpaid'.... It's those people's salaries and pensions need to be cut. Not sure how realistic that's going to be.
I don't know how realistic it is either... People are really suffering and after the introduction of Euro, greek economy has been de-industrialized, agricultural sector has become so uncompetitive that Greece started importing potatoes, tomatoes(!), etc and the services sector too expensive to be competitive (or not as competitive as it should be)... I don't see any sign of growth in the horizon...

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The other problem that is being reported is that tax evasion is a serious issue in Greece. Do you have any thoughts on that issue from a Greek perspective?
Tax evasion IS a serious problem, no doubt. Only public servants are taxed at source, the rest have to fill in the usual income and tax form. And this is where the problems start. In my previous post I was referring to social 'pathologies' and tax evasion is one of them and works in the following way:
Let's suppose you have a small business, i.e. sell ice-creams. The first way of evading taxes is simply by 'forgetting' to print out the receipt of each purchase. Common practice for many years and although you might have invoices for buying 2 tons of ice-cream, you claim you sold last year 3 kilograms of ice-cream... What happened to the rest 1997 kgs??? Nobody CARES to know... Tax clerks, when they see something like that, it is a golden opportunity for them to make 'black' money... You evaded tax from 1997 kg of ice cream, so they are more than willing to take 50% of the owed taxes so that they 'forget' these 1997kgs.... As we can see in this example... it takes two to tango...

Why is this happening? Apart from the ultra strong Euro (last 10 years), Greece has looooong ago lost its competitiveness due to the labyrinthine laws concerning business set up and operation. Greece, unfortunately IS NOT business friendly. Even a small business like an ice cream stand would require tons of bureaucracy and if you made the mistake of hiring someone, just to know how much you would have to pay for insurance coverages you would have to go through a law about dentist professional rights (! no kidding here!). How many taxes do you have to pay? Ok, 23% VAT, but that's not only it. There is a plethora of laws that include taxes about pretty much everything and they change on an extremely high frequency. Let's suppose that - as most of the professionals do in the beginning - want to be righteous and just and decide that you pay 100% of the taxes. 1st year of operation everything goes fine. 2nd year, you are happy and say, ok I will go on this way it's great. So you thought. A tax clerk comes and checks your books. In the meantime a law somewhere (probably a law about the rights of lamas in Greece) has changed so you are accused of tax evasion, as you should pay probably 20% more taxes. The clerk is also used to make some VERY good 'black' money with this strategy, so they know all the law changes and how to inflate the penalties for the particular omission in your books. Despite that you already paid a hefty amount of money for taxes you are now faced with a very high fine for your profound tax evasion. The tax clerk offers to 'forget' this little problem for 50% of the fine price... If you are brave enough to report his/her behavior, next year you will find yourself in big trouble (most tax clerks are highly ranked members of political parties)... Corruption at its finest....
So in the end many ppl (extremely wrongly in my opinion) go to the tax evasion route. And as you know... if one does it it's a crime, if all the neighborhood does it, it's a habit....

That's why Greece does not need money! It needs STRUCTURAL changes. In the laws, in the mechanisms that control public servants, in justice, everywhere. And they cost NOTHING. Sending money to Greece does not make sense. Structural changes are needed, a better functioning state is needed, a new mentality is needed, a new vision is needed, they all are free and nothing is done about them... It's really a shame... And what the greeks should be accused of (rightfully) is that they were not brave enough to change (since decades ago) the corrupt political system that set up this bad taste joke.... I don't know what to say... Sometimes people are like electricity... they follow the pathway that requires the least energy....
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