A Communist leader, 37-year-old Alexis Tsipras, has been elected in Greece in a clear vote against austerity. His party is called the “Coalition of the Radical Left” and his vision is that the European Central Bank would provide direct loans to Greece, specifically placing the “burden and risk” on the wealthy European countries.
Tsipras invoked the name of Warren Buffet as an example of what the rich should offer the poor. He said, “Do you know what Buffett said? … He said, ‘Come on, let me pay’… He said that because he could understand the danger, the danger for his class if everything is burned,” as reported by CNBC.
The new Communist leader wants to “cancel the bailout loan agreement Greece’s leaders have signed with euro-zone countries.” He told supporters that the “austerity policies of German Chancellor Angela Merkel “have suffered a crushing defeat.” Many Greeks resist austerity measures, which have thrown many into a state of poverty and have prompted widespread and violent protests, as well as a 40% increase in suicides. They also want to continue to use the Euro as their form of currency.
The State of Greece
Greece may have no choice but to leave the Euro, or be forced out, which may not only cause even more austerity, but will have further disastrous consequences of leaving them to fend completely for themselves, as the “government of Greece spends more money than it raises in taxes,” as reported by NPR. Greece received “its second multibillion-euro bailout package from the International Monetary Fund, the European Central Bank and its European partners since it ignited the euro crisis with fears of a default three years ago.”
The “solution” of getting more “loans” to maintain an already indebted country certainly does not seem to be a step in the right direction. However, if they default on their loans today, the government would avoid having to pay the exorbitant interest payments from foreign lenders.
The plight of the people in Greece should serve as a lesson to the United States. Currently, the US is borrowing money every day and there is no end in sight. White House chief of staff Jack Lew famously said in relation to President Obama’s failed budget for 2013 (voted down 414-0) that “There’s pretty broad agreement that the time for austerity is not today.” Unfortunately, changes will have to be made eventually in the ridiculous amount of wasteful spending in the government or America, too, will go the way of the Greeks.