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Greek Crisis – a guide for the perplexed: Part III – Myths about Greece and the Greek Crisis

June 28, 2015

The following is from an appendix in an upcoming book to be released in the next few days, No Hair Shirts Energy & Climate Policy for Greece. The book discusses  energy and climate policy as a means of advancing a general anti-austerity agenda. It starts with methods of relieving some of the immediate pain. For any non-Greek readers, the book includes an appendix discussing the crisis. This post excerpts the third chapter of that appendix shooting down widespread falsehoods about Greece. You may want to read the first post in this series about the general global and European context of the Greek crisis, and the second summarizing the crisis before preceding.


There are many myths about Greece used to justify EU action, to claim that the Greek people deserve their suffering. As Diane Francis of the Business Financial Post put it in 2011: ” a baseball bat may be what’s needed to fix the never-ending Greek debt mess.”

Myth) The Greek people are lazy.

Fact) The people of Greece, even before the crisis, worked longer hours and had less time off than Germany and most EU nations.

Myth) The Greek people don’t pay taxes.

Fact) The Greek rich, and small business owners evade most taxes. Taxes on wages were always collected. Thus working people in Greece pay all the taxes due, as does much of the middle class. It is only the rich, small shop owners and independent professionals such as doctors and lawyers who manage to evade taxes. Much of the tax evasion consists of moving money out of Greece into France, Germany, the UK and other EU nations. When Syriza suggested the EU help them track down this money, they were laughed at and told that tackling tax evasion is their responsibility.

Myth) Out-of-control Greek pensions need cutting.

Fact) Greek pensions have already been cut by 40%. Further, the high pension to GDP ratio is caused by a number of factors other than pensions being too high

  • Public pensions in Greece are, with trivial exceptions the only pension. Proper comparison of Greek pensions to other nations would have to include private pensions by other nations.
  • There is no unemployment insurance in Greece, and never has been much public welfare (such as food stamps in the USA). Pensions fulfill those functions as well. That has to be considered in comparison to other nations as well.
  • Greek GDP has fallen by 25% since 2008. Normally this far after the start of recession, not only would the recovery have begun, but GDP would be above 2008 levels. Of course if GDP falls, anything that survives becomes a higher percentage of GDP
  • Greece has a higher percentage of retirement age people than most other EU nations.

Myth) Greeks retire at 53.

Fact) Before the crash, 53 was early retirement at half-pension certain civil servants could take – usually in order to move to other jobs without completely losing past pension benefits. Average retirement age in Greece, pre-crash was higher than Germany and higher than OECD average. Early retirement age, post crash has already been raised. Again, early retirement means half-pension.

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