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Greece Debt Crisis
People around the world love the Olympics. The Games bring nations together and promote peace through friendly competition. They tell life-affirming stories of humanity's endurance and drive and the capabilities of our bodies. They bring joy to so many that we need to devise some way to stop them from also bringing so much pain in the form of billions of dollars of debt.
In many ways the United Kingdom of Great Britain and Northern Ireland, which joined what was then the European Common Market in 1973, represents a distinct society in its own right: with its strong currency it remains outside the Euro zone, fails to participate to the Schengen Area regulating border controls, while enjoying special budgetary rules.
The Greek failure to successfully address tax evasion should prove instructive to Ontario Premier Kathleen Wynne, who in 2014 pledged to crack down on tax cheats. Greek measures to tackle evasion with enforcement have resulted in only small improvements. An enforcement only strategy should not be the model Ontario follows for tackling the underground economy. Relying on enforcement and punishment squeezes legitimate businesses who are already faced with high compliance costs and tax and regulatory burdens.
It's time for an enormous dose of tough love, so we can finally turn the most beautiful country in the world into a viable, democratic, modern society.
Greece does not have its own currency to devalue to gain economic relief. And so the nation's debt problem can't be fixed by issuing more loans with conditions that kill economic growth. If truth be told, there has never been a bailout designed to bail out the Greeks. The aid issued to date has been all about buying time to play musical bondholders.
Wall Street melts down in 2008. Greece announces financial troubles and borrows €110 billion in 2010. It isn't enough, so a second bailout package brings the total loan to €246 billion by 2016. In early 2015, Alexis Tsipras of the radical left Syriza party is sworn in as the new prime minister with a plan to refuse any more loans. On June 28, the Greek government announces bank closures. Two days later, they miss an IMF payment and default on their debt.
A Greek crisis cannot be good for the world right now, and we cannot/should not be mute spectators. Here are some reasons why we in Canada in particular, and the rest of the world in general, have to cautiously monitor the current events in Greece, and should try to guide or help Greece get out of the crisis before it becomes contagious. Canada already has internal financial stresses, just like many other countries around the world do, at this moment; this Greek crisis can add to external stress for many countries, and this really is bad timing, and an unwanted occurrence for the world economy.
To be sure, the Forum once again generated news and social content about business trends, societal needs, industry insights and new voices in the global economy. But the real conversations in the hallways were that global business leaders are more concerned over the threat of Euro collapse than debating problems of income inequality.
