Threat of Grexit Looms as Things Heat Up (Again) in Europe

Greece is promising once again to come up with a list of reforms.


Greek PM Alexis Tsipras

Greece has promised to fulfill an earlier promise to present European leaders with a list of financial reforms it promises it's going to implement. Got that? Reports Reuters:

Greece said it will present a package of reforms to its euro zone partners by next Monday in hope of unlocking aid to help it deal with a cash crunch and avoid default.

"It will be done at the latest by Monday," government spokesman Gabriel Sakellaridis told Mega TV.

Greece's left-wing government and its euro zone creditors agreed last week that Athens would come up with a list of its own reforms, which must achieve a similar budget impact to measures agreed by the previous conservative-led administration.

All of this is the inevitable second act following a recent last-second deal, which I reported on in February, to avert crisis and a Greek exit from the Eurozone. Back then, newly elected Greek Prime Minister Alex Tsipras agreed to hit pause on plans to roll back austerity in the struggling Mediterranean country. In exchange, he received a four-month extension on paying back more than $270 billion worth of loans—with the condition that he lay out for approval a schedule of reforms meant to get the nation back on firm financial footing.

That never quite happened, as The New York Times explains:

Four weeks after undertaking to do so, Athens has yet to present a list of detailed reforms that it would carry out to get the next installment of credit from its three main creditors — the International Monetary Fund, the European Central Bank and the European Commission, which is acting on behalf of the 18 other members of the eurozone.

The Greek failure to present clear demands has infuriated many Germans, with public opinion polls showing emotions rising against further rescue. 

Time is running out for the two sides to come to an accord to keep the money flowing. On Monday came news that Tsipras had sent a letter to German Chancellor Angela Merkel warning that Greece is low on cash and will soon have to choose between servicing its debt and paying public employees' salaries and pensions. Merkel for her part insists she doesn't have the authority to approve a reform program herself. Instead, she has said, it must be submitted to the larger group of European leaders and institutions for evaluation.

Tsipras is expected to promise a series of bold efforts to combat tax evasion in the country. Athens has always had trouble collecting the taxes it's technically owed, and recent uncertainty about the chances of Grexit has only made that problem worse. According to The Wall Street Journal, some $86 billion worth of taxes remained unpaid by the Greek people, as of the end of last year.

Tsipras hopes that if he can find a way to increase revenue collections, Merkel and the others will allow the extra money to go toward easing the (highly unpopular) austerity program that was imposed as part of the previous bailouts.

NEXT: Extremely Limited Medical Marijuana Use May Be Coming to Georgia

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Like I’ve been saying, complete Greece’s transformation into a theme park.

    1. Will there be an adults-only section of the park?

      1. Complete with Anal-eze fountains…

      2. Sure. It’ll be like a Disney cruise ship, with all of the kid stuff and a whole section for adult stuff.

        Legally, I suggest granting Disney a 99-year lease to the country, with total control. For the duration, Greek citizens will be employees of Disney.

    2. I make up to usd90 an hour working from my home. My story is that I quit working at Walmart to work online and with a little effort I easily bring in around $40h to usd86h Someone was good to me by sharing this link with me, so now i am hoping i could help someone else out there by sharing this link……… Try it, you won’t regret it!…

    3. I make up to usd90 an hour working from my home. My story is that I quit working at Walmart to work online and with a little effort I easily bring in around $40h to usd86h Someone was good to me by sharing this link with me, so now i am hoping i could help someone else out there by sharing this link……… Try it, you won’t regret it!…

  2. If Greece is having so much trouble collecting taxes, why not just go to a straight sales tax and eliminate all the others?

    To simple?

    1. Absolutely. Squeezing more money out of people is sure to improve their economic situation.

      1. Not saying Greece should squeeze more, just saying that if their tax regime is so complex it makes dodging easy and enforcement difficult…why not simplify it? Of course, Greece needs to drastically reduce outlays but this is unlikely to happen.

        1. I’d agree with simplification, but doubt that Greece will do anything so sensible. More likely they will just engage in more wasteful government to address the wasteful government they currently have, and that takes more Other People’s Money.

          1. Clearly we can all agree the answer is to continue the cradle-to-beach-to-grave welfare state. Right?

    2. Did you see the thing (last year?) about a gas station owner driving a tax collector away with a whip? Tax collection in Greece is not easy.

      The tl;dr message from Greece seems to be: “Give us more money or we won’t pay you what we owe you!”

      1. They’ve been making moves toward Russia as well. I little veiled threat with that Fuck You?

        1. Looks like we should have let it go commie back in the 50’s.

          1. Maybe we did.

    3. They’d probably have to outlaw cash transactions. Like France.

      Pushing 75% of your commerce into the black market doesn’t seem like a good way to implement a sales tax. But it will certainly allow the market to decide which currency it wants to use.

  3. find a way to increase revenue collections

    Sic our IRS on them.

  4. Fuck Greece, right in the ass

    1. Well, it’s traditional.

    2. Fuck Greece, right in the ass

      That’s what the Spartans said.

  5. Is Greece worth enough for Germany to just annex? South Germany?

    1. Greece could be Germany’s Florida.

      1. Will there be ‘Greek Man’?

        Er, I think there already is.

  6. “Fool me once, shame on … shame on you. Fool me… You can’t get fooled again!”

  7. 86 billion? How much is that for every Greek person?

    1. Are you suggesting that we just purchase Greek People?

      1. We could open up a diner with dynamite coffee and pancakes.

        1. *polishing my monocle and eyeing orphan Greek children*

      2. I would think they would be expensive and judging from the state of the country, pretty lazy and useless.

        1. Well, um, German ‘investors’ might be motivated to, you know, go down there and make them work…

          1. Look, Restoras, everyone knows that work will set you free…of debt.

    2. 8600 per person

  8. “According to The Wall Street Journal, some $86 billion worth of taxes remained unpaid by the Greek people, as of the end of last year.”

    Based on the overall employment rate and general lack of work ethic, I’m going to ballpark this $86 billion to about 50 years worth of government receipts outstanding.

  9. I predict 300 Greeks will rush to Thermopylae and push back the advancing Germans, er, Persians. But first they should consult the Oracle (Warren Buffet).

    But the long term outcome will be less than desirable. 🙁

  10. The New York Times employs some of the dumbest people in the known universe. Check out this missive they sent out on the Bergdahl being charged with desertion story.…..elievable/

    1. LOL. In the old days, being convicted of desertion didn’t just “hinder your job prospects,” it hindered your breathing prospects.

      Now I get to email an old friend and yellow dog Democrat who said I was being unfair to Bergdahl last year. I told him, but he wouldn’t listen….

      1. That they would think there is a possibility the Army would give someone convicted of desertion would still get an honorable discharge boggles the mind.

        1. It does. It’s a level of cluelessness equal to “Where does Ted Cruz get the wacky idea that rights come from God??”

    2. Wow. Would Bergdahl even be eligible for anything higher than OTH if found guilty of desertion? I’m not familiar with the UCMJ.

      1. Bad Conduct at a minimum.

  11. You know who else found that Greece was more trouble than it was worth?

    1. Socrates?

    2. Eva Green in a rather lackluster movie sequel?

      1. Except for the hot as the sun sex romp, but yeah…

        1. There was a definite thickening during that scene.

    3. Jacqueline Bove Kennedy?

    4. Xerxes?

    5. The Ottoman Sultan?

  12. Tsipras is expected to promise a series of bold efforts to combat tax evasion in the country.

    Bold effort suggestion: Let’s export our great tax visionaries like Buffett and Krugman to Greece.

  13. Here’s some Guardian Derp on Greece:

    mariavincent bruxxman 5h ago

    I don’t know what Estonia or Latvia’s reforms consisted of, but you can’t reform an economy by firing people, kicking 1/3 of the population off healthcare, closing businesses, increasing unemployment to nearly 30%, reducing the standard of living by 25%, etc. For the past 5 years, Greece has been going through what the US went through during the Great Depression, but there is no Roosevelt in sight, only a bunch of Hoovers in Brussels calling the shots.

    1. typical of what passes for greek economic deep thoughts

  14. WitchDoctor 6h ago

    Funny this takeover of the Guardian live blog by the hordes of Volunteers of the Cult of “living within your means”.
    Considering that we live in the debt driven economy, where the money in circulation is debt ( or for the pheasants it is the loan/credit), and taking in account that average Western household is indebted around 200% of its income, the pushers of the simpleton household economics of the living within your means should consider that their ideological trolling will
    bring the West to the end of life on Earth as they know it and as they consume it.
    So dear lonesome reader, consider this:
    there is a Big pigpen where the money is so high, as it was never in the history of the mankind.There are streets paved with this Fiat. There is Fiat Money, money out of thin air, there are quadrillion of derivatives and of the shadow banking , dear reader, you can not even dream of.The Upper Pigpen is completely loaded, and is loading more and more.
    There are Pigs so fat, that there were none till today in whole history.
    And there are other pigs, much more skinny, but they aim in vain to become fat.
    The biblical corruption of the bodies and minds.
    And dear reader, if they told you that you have to pay fort he skinny pigs, and you believed them, think.

    1. Continued It is a trap, they are just going for your money, when they print theirs.
      So forget living within your means, you will loose the pants, too.That is the game.
      So who is culpable in this dichotomy of the pig pens?
      The parable of Lot comes in very handy.
      Witchdoctor, ya, the voice from Babylon

    2. The cult of living within our means……I can’t even.

  15. “series of bold efforts to combat tax evasion”

    Greece’s insane commitment to an overburdensome regulatory and tax regime is part of the two edged sword that got them into this mess (the other half being the govt corruption and cronyism that inevitably grows like a cancer from such a system).

    Greece must be removed from the EU. There is no chance of real economic reforms being made. I suspect that if by some miracle a sane, honest free marketeer dound his way to the helm he would be promptly forced out or assasinated.

    Greece is now a formal kleptocracy. Every ounce of popular support is behind not just running business as usual but making all of the problems worse – stealing more from the EU, printing more money, hiring more govt workers.

    Allowing Greece to continue its sick relationship with the rest of Europe speaks to jusr how degenerate the EU’s economic thinking is: “If we hold on just long enough, we can print enough money to gice to greece so they can pay us back again”.

    That is not to say Europe should forgive the debt. Initially this was the way to go, but Greece has shown itself two blind & insane to be tempted by such a carrot. Forgiving the debt at this point would merely prolong the inevitable. Greece must be forced to govern with access to the money of others.

    1. Greece was allowed in so France wouldn’t look corrupt in comparison.

    2. Want to start a business in Greece? Be prepared to submit lung x-rays and stool samples to the Department of Health.

      Oh, and make sure your website is in Greek, even if your customers are not Greek.

      1. A gem from the comments:

        This has nothing to do with “Socialism”, as there are Socialist countries in Europe that are doing well and are supporting the right business (with the right limits and regulations while demanding accountability and responsibility from these businesses).

        It is the attitude of people who accept too much corruption and make it cultural – like India, and then whine, complain, rant and rage about other people, politicians and political leaders who are the problems. Who elected these politicians, who supported them and who voted them in? The people!

        Oh, if only the government would just dissolve the people and elect a new one!

  16. beware of Greeks bearing grifts.

  17. Time for Greece to bail on the Euro experiment. Short term pain while they create their own currency, inflate it to cover domestic debts, default on international debts, and use the new weaker currency to undercut Euro member manufacturing to grow their economy.

    They’ll be better off in the long run.

Please to post comments

Comments are closed.