Management: Eurozone and Member Countries

The Troika, made up of the International Monetary Fund, European Commissions and the European Central Bank have the most to lose in this debt crisis as they own 78% of Greek debt. With so much to lose we have seen European “bailout” agreements that mostly front the Greek government more money coupled with crippling austerity in an effort to “rebuild” the economy. Austerity discourages growth as it cuts the spending of the government who is by far the biggest spender in the economy. The effects of austerity can be devastating, but the true effects are often hidden beneath the messages we get from mainstream news sources. The stereotype of the Greek people as lazy and tax evading has desensitized the public and has made austerity seem like more of a sensible option. The media messages have made strict austerity measures seem justified and in effect have hegemozined the Greek people.

I do not believe that the American people and the Congress wish to turn a deaf ear to the appeal of the Greek Government. Greece is not a rich country. Lack of sufficient natural resources has always forced the Greek people to work hard to make both ends meet. Since 1940, this industrious, peace loving country has suffered invasion, four years of cruel enemy occupation, and bitter internal strife.

Greece has spread their crisis through other countries like portugal, italy, and ireland. In those countries it has hit hard the crisis. It explain that U.S is not likely to end up like Greece because of three reasons. Reason one is that the currency is stable, reason two The federal reserve is keeping the interest rates low. And finally the third reason is that the U.S economy is debt is a safe investment. It says that people don’t know how to spend right. That the U.S. spending is very irresponsible. By more time passes by the same way the U.S. economy will be horrible. Tax will increase because of this. Debt would hit everyone in the us and that it would be a good place to live as it is now. The federal reserve is looking for a long-range plan to pay down the crazy debt. I think it’s kind of embarrassing in my opinion that we can save money and spend less. Yes there is always time for spending in whatever you want but don’t get me wrong it is nice to have a lot of things and show them off. Personally I have done it myself. It feels good, I know it does because I have experienced it. There is time and place for everything. Going to the

The article “How Germany Prevailed in the Greek Bailout” discusses Germany’s successes financially in comparison to most other (19 countries) in Europe. Although Germany has such success others see the country as a bully almost due to their militaristic background even though they have come to the aid of Greece and helped. Many other European countries are hesitant about Greece receiving aid considering the countries past failures financially. This is not the first time the country has been in debt and undoubtedly will not be the last. Since the economy fell in 2008 Greece’s unemployment rate is about 22% which is double the U.S. Due to an imbalance in European countries where some are creditors and others debtors it is difficult to fix this

Ever since the end of 2009, Greece has been involved in a financial and economic crisis that has been record breaking and shattered world records in terms of its severity and worldwide effects. The Greek government, since the beginning of the crisis, has attempted to take several governmental measures to try and “stop the bleeding,” including economy policy changes, dramatic government spending and budget cuts and the implementation of new taxes for citizens. In addition to this, the government has tried to alter the perceptions of Greek government and economy by the rest of the world in an effort to appear both more liberal and more democratic. Greece has also been working to privatize many previous

Greece’s financial issues have always been apparent, but now it’s becoming impossible for the government to hide their financial issues.

The roots of Greece’s economic problems extend deep down into the recesses of history. After the government dropped the drachma for the euro in 2001, the economy started to grow by an average of 4% annually, almost twice the European Union average. Interest rates were low, unemployment was dropping, and trade was at an all-time high. However, these promising indicators masked horrible fiscal governance, growing government debt and declining current account balances. Greece was banking on the rapid economic growth to build upwards on highly unstable foundations. In 2008, the inevitable happened – the Greek debt crisis.

In 1999, ten European nations joined together to create an economic and monetary union known as the Eurozone. Countries, such as Germany, have thrived with the euro but nations, like Greece, have deteriorated since its adoption of the euro in 2001. The Eurozone was created in 1999 and currently consists of eighteen European nations united under the European Central Bank and all use the euro. The Eurozone has a one point six percent inflation rate and an eleven point six percent unemployment rate in 2014. Greece joined the Eurozone in 2001 and was the poorest European Union member at the time with a two point six percent inflation rate3 (James, 2000). Greece had a long economic history before joining the Eurozone. The economy flourished from 1960 to 1970 with low inflation and modernization and industrialization occurring. The market crash in the late 1970’s led Greece into a state of recession that the nation is still struggling with. Military failures, the PASOK party and the introduction of the euro have further tarnished Greece’s economic stability. The nation struggles with lack of competitiveness, high deficit, and inflation. Greece has many options like bailouts, rescue packages, and PPP to help dig it out of this recession. The best option is to abandon the Eurozone and go back to the drachma. Greece’s inflation and deficit are increasing more and more and loans and bailouts have not worked in the past. Leaving the Eurozone will allow Greece to restructure and rebuild

The economic crisis of 2008 in New York had ripple effects around the world, causing deep structural problems within the European Union to crumble the economies of several countries. These countries, known as the PIGS, are made up of Portugal, Ireland, Greece, and Spain, and collectively hold most of the sovereign debt problems of the European Union. After fast growth early in the decade, these countries were spending too much money and not securing their own banking sectors with enough capital. Soon, the debt the PIGS owed caused massive problems throughout the EU, and Germany and France had to come to the rescue of these poorly managed countries. (Greek Crisis Timeline, 1) Now, in 2012, the issue has yet to be fully resolved. Greece is still sinking, and a massive bailout for Greece's banks is required. The debate is whether Germany should continue bailing out Greece and collecting interest on its loans, or whether Greece should try to separate itself from the broader European Union, in an attempt to manage its own finances and declare bankruptcy in order to save itself from crippling interest payments. Each path offers an escape from the present situation that Greece finds itself in, but only the path of bailout results in a harmonious European Union. If Greece fragments off from the EU, then the entire union is weakened as a result. I believe that Greece should accept the terms of the bailout that Germany has provided, and should undergo several years

Although a commonly accepted view is that the hidden budget deficit in Greece is the beginning of the European sovereign debt crisis, the real causes of this economic crisis can be various. To reveal the whole event, a comprehensive review of the background is

EU as a whole experienced significant economic slowdown in 2008, as reported by the EU commission . In response to this in 2008, the European Economic Recovery Plan (EERP) was launched. The plan aimed to increase demand by bolstering purchasing power, revive the labor markets, and raise confidence in the financial system. Since the EU is only a common currency union and not fiscal union, it limited the ability of EU leaders and institutions to respond. In result, the crisis escalated and in 2009 the European debt crises hit the EU. During this period, some EU members were unable to pay their government debt or to bail out their indebted banks on their own and called to EU financial entities for help. In 2010 leading European countries created various entities such as the European Stability Mechanism (ESM) to deal with the crisis, while the Central European bank (ECB) helped by providing cheap loans and reduced interest rates in order to sustain the money flow between European banks. As a result, European banks became owners of substantial portion of sovereign debt. Due to these stabilizing measures Ireland and Portugal were able to complete their bailout plans in 2014, Cyprus is expected to complete its bailout in 2016, while Spain never received bailout assistance and is slowly recovering. Greece experienced the most dramatic crisis in 2015, since the state was on the verge of financial default. Greece refused to accept the repayment conditions offered by the ECB, and

Inflation, crisis, recession, fear, unemployment rise, debt, and depression are some of the commonly used phrases in relation to failing economies. There are many different factors that contribute to the downfall of an economy, whether it be the political structure, the aftermath of a war, or the role of government itself. A failing economy’s severity can vary based on the specific country’s situation. In comparison to the world, there have been a few countries under the European Union that have continually worsened economically through the years: Greece and Spain.

"Europe must prevent Greece from becoming an out-and-out catastrophe and make sure that the same fiscal 'remedy' is not applied to other weak economies" -- Franziska Brantner

The aim of this essay is to provide a framework for uncovering the current state of the EU. Firstly, it is important to briefly summarise how the sovereign debt crisis manifested inherent structural flaws within the European Union. From this point it will be argued that the debt crisis can be used as a platform for deeper integration in that the inherent design features that plagued the Union can now be recognised and perhaps transformed. Secondly, it will be argued that the debt crisis has exacerbated the division between the creditor countries of Northern Europe and the debtor countries of southern Europe. A climate of ‘us and them’ has certainly manifested across Europe, which raises concern to nationally elected representatives of the

Thus, this highlights the utter hypocrisy of the current negotiations surrounding Greece: both France and Germany, in fact, conveniently ignored the rules for the fiscal convergence criteria when it suited them. Neither country was sanctioned in a major way. France could well find itself in the firing line if it fails to prevent a Greek exit from the single currency. The sustainability of the current membership of euro has, therefore, not been laid to rest.