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From looking quite closely, it was apparent that the tax evasion story was a bit overblown. I don't know where the tax revenue is coming from, maybe corporate taxes, but Greece was averaging 9.7k per capita in taxes, which was on the high side

I'm not sure about the absolute number, but on a per capita basis, Greece has the lowest tax revenue as a % of GDP of all EU15 members and quite a few EU27 members. This is due to both large tax evasion and a low and diminishing corporate tax and a skewed tax structure. Note too that (I can't find the stats right now, but take my word for it!) indirect taxes are not so lagging as per the EU (although VAT theft is an issue as well).

I'm not sure about the numbers regarding pensions and public sector wages either. The numbers I've seen are at 9% of GDP and that is close to 35% of public expenditures, 45% if you only count primary expenditures which I think some do, but never mention... anything beyond that requires statistical alchemy AFAICS. The numbers don't add up otherwise. This is the budget for 2009 (in greek!).

As for working in Greece: the pay and the conditions used to be horrible. Now they will be intolerable. I expect (and I am seeing already) a huge exodus of young, talented and highly trained people...

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Fri May 14th, 2010 at 04:58:36 AM EST
[ Parent ]
superb diary, thanks Talos. Looking forward to pt 2!

Italy will probably look like this within a year or two, barring a miracle...

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Fri May 14th, 2010 at 06:22:16 AM EST
[ Parent ]
Indeed. Structurally, I don't quite understand how it is that Italy hasn't been targeted by the wolf pack yet (it is in a much worse position than Spain, in many respects)

Best guess : it's because il padrone is one of the meanest m*****ing wolves in the pack.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Sat May 15th, 2010 at 01:22:30 PM EST
[ Parent ]
I've been very interested in the stats, but I'm about to give up since the OECD/Heritage Foundation numbers differ from what is on the Eurostat pages.

Eurostat has gov't worker pay at 29.5 billion, or 33% of the budget. The IMF says gov't worker pay and pensions is 75%. And yet the OECD numbers diverge.

http://epp.eurostat.ec.europa.eu/portal/page/portal/product_details/publication?p_product_code=KS-EK -10-001

by Upstate NY on Fri May 14th, 2010 at 08:26:46 AM EST
[ Parent ]
I think what is happening is that the oecd table includes social contributions as budgetary  revenue and social benefits as budgetary costs - while the Greek government tables exclude the costs and the benefits from their calculations in the main table - possibly because government has no direct control of these revenues, and theoretically simply "guarranties" most of the social benefit costs. The IMF then counts all social benefits as part of the wage bill, which is quite a trick IMHO. Hah, talking about cooking up numbers...

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Fri May 14th, 2010 at 08:53:43 AM EST
[ Parent ]
Maybe I just don't know who handles it, but it shouldn't be this difficult to find reporting on Greek finances.

Do the EU and/or national laws not require governments to produce CAFRs or other audited financial statements for the public?

You shouldn't need to go digging through Eurostat or the OECD to find out how much they're spending on this or that.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Fri May 14th, 2010 at 09:21:19 AM EST
[ Parent ]
Well, Talos provided the Greek figures.

The problem isn't that the figures aren't readily available, it's that they differ.

Right on the page for Eurostat statistics you'll find a Eurostat report dated January 10, 2010 that explains the Greek statistic situation. The short of it: Greece gave bad predictive statistics each year, and then Eurostat conducted a methodological review (each year) that gave the actual statistics.

by Upstate NY on Fri May 14th, 2010 at 10:06:20 AM EST
[ Parent ]

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