Greece is at the center of the global economic system coming into its newest phase of operation. Never before within the history of the modern global economic system has there been a challenge such as the current situation in Europe (and on the horizon in the U.S.). Now we are seeing the brutal reality of how international bailouts and the IMF will actually work.
Since about the end of World War II there has been an economic system put into effect which theoretically is supposed to help prevent a situation like like the Great Depression which proceeded World War II. The International Monetary Fund was created with the goal of helping to prevent economic crises or help countries that find themselves in financial crisis. As the IMF orchestrates financial aid they do so at a price. The IMF will make demands of a country receiving aid in order to have a say in the rebuilding of the economy, hoping to prevent a future problem.
Greece now finds itself under the direction of the IMF and Europe in order to secure the loans needed to prevent defaulting. Although Greece is being praised for the amount of work in restructure and implementation of austerity measures Greek people are not so happy with the results. It has meant that the Greek people are forced to deal with whatever poverty inducing measures that are dictated to them. Massive protests have ensued. Due to the Greeks displeasure with being forced to live in poverty for what is mostly the fault of collusion between bankers and government aside from protests and riots there has been resistance to paying certain taxes that have been levied on them since the beginning of the crisis.
Greece’s most recently has past a new property tax in order to fulfill its obligations to the IMF and Europe, which will ensure the release of more funds to continue to be able to pay their bills. The matter in which the tax will be collected is very controversial, and shows the kind of tactics which should expected when dealing with the IMF. The tax will be included in Greek energy bills. Tax evaders will therefore be faced with the possibility of having their power cut off.
Mr Papandreou attended a media conference on Tuesday evening with German Chancellor Angela Merkel, where she said Germany wanted a strong Greece.
“We will do everything that is necessary for that,” said Mrs Merkel, but added that Greece had to fulfil its obligations in order to keep the support of the International Monetary Fund, the European Central Bank and the EU Commission.
“Through the euro, we are closely bound together, and the weakness of one affects us all,” she added.
Meanwhile the Greek parliament has passed a controversial new property tax bill, first announced earlier this month, that aims to boost revenues.
All 154 of the ruling Socialist PASOK party’s deputies voted in favour of the measure, winning a majority in the 300-seat parliament.
The move will prove controversial among Greeks, with the extra tax to be paid through electricity bills to make it easier for the state to collect.
Anyone who does not pay the new tax risks having their power cut off. Read entire article
Due to the fact that the current economic crisis has no end in sight, it will be inevitable that more and more countries will soon be requesting similar help from the IMF. The outlook is so bleak that the IMF is looking to increase the fund’s savings in case more countries do need help. Since the IMF sees reason to be concerned about their ability to be able to cover the coming economic crises it is guaranteed that in order to protect their money the policies required by the IMF to secure such loans will become more and more drastic. This will possibly require the countries receiving loans to cut funding for all programs to minimum levels, which will not take into account the preservation of a first world lifestyle. The IMF generally requires cuts to all social welfare programs (not necessarily corporate welfare because business is the key to economic recovery, businesses make money, people waste money). If the restructuring of a nations funding of government programs does not work then eventually pensions will be attacked, and possibly land sold off (as Greece has had to consider).
If we continue to try to prop up an economy that is beyond repair we are only feeding into the governments and bankers wishes. The loans of the IMF have to be paid back with interest. With compound interest policies factored in the IMF and banks involved have so much money to gain in the long term in exchange for some short term suffering. Few politicians will gain a lot off of such a crisis but for those politicians that crave power the crisis only serves them in justifying the ability to pass laws which will solidify the control of the economy and the lives of their citizens. The name of the game is the consolidation of ownership and power. Let the economies fall and rebuild it for ourselves. The more we feed into trying to fix the economies through the governments and institutions which they have established for us the more we play into the elaborate scheme which they were waiting for. Those who were at Bretton Woods, which created the IMF and much of the modern economy, envisioned the day that the institutions they created would grow into a global regulating and governing structure. As this plan comes to fruition our individual freedom and sovereignty dies.