An excellent analysis over @ flipchartfairlytales which shows that the root of the Greek crisis is the failure of tax collection and the size of the shadow economy.
My comment was:
What this illustrates is the importance of a competent, respected and trusted public administration. People will pay taxes if they are convinced that the officials assessing and collecting them are not politically biased or corrupt, if the money will be used for the public purposes for which it is collected and if the public services provided are also unbiased and not corrupt. That is why the most commonly autonomous public agency is the tax collection agency (in the UK the only significant government department that is based on legislation and not the whim of the PM is HMRC).
I would argue that good public administration and democracy go hand in hand, and the reason Greece has such problems is because of the legacy of fascism and dictatorship. Note that the PIGS – Portugal, Italy and/or Ireland, Greece and Spain – were all formerly dictatorships, in three cases only a generation ago. Ireland was not a dictatorship but was for a long time almost a one-party theocratic state in the 1950s. None if these has really thoroughly thrown off this history.
One thought on “Why Greece is a Basket Case?”
Personally I hope they all default !