Last week, I mentioned a rumor that the Greek government didn’t actually cut spending and lay off public employees at the level that it had committed to in order to meet the bailout requirements. Now, it is official. According to Reuters:
Greece conceded on Thursday it had slipped “in some respects” in implementing the cuts and reforms demanded by lenders in exchange for saving Athens from bankruptcy, and tried to persuade them to cut the country some slack.
Finance Minister Yannis Stournaras made the admission after meeting senior officials from Greece’s “troika” of lenders from the EU, European Central Bank and International Monetary Fund, whose inspectors have begun picking through the country’s books after weeks of political paralysis.
According to the report, in 2010 and 2011, rather than cutting spending as the Greek government had promised, it actually hired as many as 70,000 public employees. Now that they are exposed, the government officials are trying — it seems — to sell the deception as a good thing and as consistent with the European focus (driven by the French president) on growth. Growth, in theory, is supposed to materialize through government spending and the employment of bureaucrats.
I had mentioned my doubts about Greece’s actual commitment to cutting government spending after reading reports that the country’s “parliament kept full pay, full benefits, its fleet of BMWs, and a full staff. Greece maintained its sweetheart subsidies for businesses, banks, the army and those who choose not to work. Its sizeable delegations and facilities in Brussels, Vienna, Geneva and Washington are still large, as are the life-time pensions for politicians.”
The whole thing is here.
The one and only.