[THE TSUNAMI of cheap credit that rolled across the planet between 2002 and 2007] wasn't just money, it was . . .
. . . temptation. It offered entire societies the chance to reveal aspects of their characters they could not normally afford to indulge.
Entire countries were told, "The lights are out, you can do whatever you want to do and no one will ever know." What they wanted to do with the money in the dark varied. Americans wanted to own homes far larger than they could afford, and to allow the strong to exploit the weak. Icelanders wanted to stop fishing and become investment bankers, and to allow their alpha males to reveal a theretofore suppressed megalomania. The Germans wanted to be more German; the Irish wanted to stop being Irish. . . .
. . . .
As it turned out, what the Greeks wanted to do, once the lights went out and they were alone in the dark with a pile of borrowed money, was turn their government into a pinata stuffed with fantastic sums and give as many citizens as possible a whack at it. In just the past decade the wage bill of the Greek public sector has doubled, in real terms -- and that number doesn't take into account the bribes collected by public officials. The average government job pays almost three times the average private-sector job. . . .
The average state railraod employee earns 65,000 euros a year. Twenty years ago a successful businessman turned minister of finance named Stefanos Manos pointed out that it would be cheaper to put all Greece's rail passengers into taxicabs: it's still true. . . .
The Greek public-school system is the site of breathtaking inefficiency: one of the lowest-ranked systems in Europe, it nonetheless employs four times as many teachers per pupil as the highest-ranked, Finland's. Greeks who send their children to public schools simply assume that they will need to hire private tutors to make sure they actually learn something. . . .
The retirement age for Greek jobs classified as "arduous" is as early as 55 for men and 50 for women. As this is also the moment when the state begins to shovel out generous pensions, more than 600 Greek professions somehow managed to get themselves classified as arduous: hairdressers, radio announcers, waiters, musicians, and on and on and on. The Greek public health-care system spends far more on supplies than the European average -- and it is not uncommon . . . to see nurses and doctors leaving the job with their arms filled with paper towels and diapers and whatever else they can plunder from the supply closets.
Where waste ends and theft begins almost doesn't matter; the one masks and thus enables the other. It's simply assumed, for instance, that anyone who is working for the government is meant to be bribed. People who go to public health clinics assume they will need to bribe doctors who actually take care of them. . . .
. . . .
The costs of running the Greek government are only half the failed equation: there's also the matter of government revenues. . . .
. . . .
. . . . [One source] just took it for granted that I knew that the only Greeks who paid their taxes were the ones who could not avoid doing so -- the salaried employees of corporations, who had their taxes withheld . . . . The vast economy of self-employed workers . . . cheated . . . . "It's become a cultural trait," he said. "The Greek people never learned to pay taxes. And they never did because no one is punished. No one has ever been punished. . . ."
. . . .
And he went on, describing a system that was, in its way, a thing of beauty. It mimicked the tax-collecting systems of an advanced economy -- and employed a huge number of tax collectors -- while it was in fact rigged to enable an entire society to cheat on their [read its] taxes. . . .
. . . .
The Greek state was not just corrupt but also corrupting. Once you saw how it worked you could understand a phenomenon which otherwise made no sense at all: the difficulty Greek people have saying a kind word about one another. Individual Greeks are delightful: funny, warm, smart, and good company. . . . [But they] do not share the sentiment about one another: the hardest thing to do in Greece is to get one Greek to compliment another behind his back. No success of any kind is regarded without suspicion. Everyone is pretty sure everyone is cheating on his taxes, or bribing politicians, or taking bribes, or lying about the value of his real estate. And this total absence of faith in one another is self-reinforcing. The epidemic of lying and cheating and stealing makes any sort of civic life impossible; the collapse of civic life only encourages more lying, cheating, and stealing. . . .
. . . . [The] credit booms has pushed the country over the edge, into total moral collapse.
(Michael Lewis, "Beware of Greeks Bearing Bonds," Vanity Fair, October 1, 2010 (reparagraphed))
Mr. Lewis makes no analogies between Greekonomics and Obamanomics, but the two economic theories have much in common. We are still far behind the Greeks in implementing our spendthrift theories, of course. But the administration's eagnerness to spend borrowed money for favored constituences is more like a pinata than not.
America also has its share of tax cheats, at least one of whom is secretary of the Treasury and others of whom serve in Congress. We are almost to the point where 50 percent of filers pay no federal income taxes. The remarkable thing is that this tax avoidance is not illegal. It's policy.
The purpose, I believe, is to create a constituency for the Democratic Party. A majority of takers who can, in theory at least, always outvote the minority of makers who pay all the bills.
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