The past actions of the Greek Governments abusing the benefit of being included into the European Union by borrowing money well beyond their means has resulted in a major financial crisis.
Greece is physically unable to pay off the debt it owes to its European creditors. It has lost creditability with its allies. Therefore, countries are reluctant and refusing to lend Greece further financing. The country has made substantial cuts to salaries of public sector employees and their pensions. Furthermore, taxation laws are now strictly enforced and income taxes have been increased. One asks, should Greece declare bankruptcy and leave the Euro Zone, or will its European creditors forgive most of the Greek debt? It is unfortunate that the Greek Government has borrowed irresponsibly for many years and now the Greek people have to endure quite harsh consequences.
I have witnessed the effect of these austerity measures implemented recently when I was in Greece this summer. This included high unemployment, store closures, properties for lease and general reduced spending. The unfortunate part in all of this is that Greek residents will have to bare the pain until if and when a full recovery occurs.
Citation: Schwartz, Nelson D. “Europe Stews on Greece, and Markets Sweat Out the Wait.” 25 September 2011. Web. 1 October. 2011.
Picture: Christofer, Kat. “Athenian democracy in ruins.” 8 September 2008. Web. 1 October. 2011.<http://www.guardian.co.uk/commentisfree/2008/dec/08/greece>