Tuesday, June 30, 2015

Where Did All The Money That Greece Borrowed Go?



Phillip Inman, The Guardian: Where did the Greek bailout money go?

Less than 10% of the money was used by the government for reforming its economy and safeguarding weaker members of society.

Only a small fraction of the €240bn (£170bn) total bailout money Greece received in 2010 and 2012 found its way into the government’s coffers to soften the blow of the 2008 financial crash and fund reform programmes.

Most of the money went to the banks that lent Greece funds before the crash.

Unlike most of Europe, which ran up large budget deficits to protect pensioners and welfare recipients, Athens was then forced to dramatically reduce its deficit by squeezing pensions and cutting the minimum wage.

WNU Editor: This analysis ignores the years before the 2008 financial crisis when the Greek government .... with the backing of the voters who voted them in .... spent the money that they borrowed on projects like the Olympics in 2004 and .... of course .... social programs, infrastructure, and government jobs. Money that bought votes .... but money that had to eventually be paid back one day. But Phillip Inman is correct that after 2008 .... with exposure running in the hundreds of billions in Euros .... the "powers that be" scrambled to convert this debt exposure from private institutions to the public ones .... hence socking today's taxpayers with the bill.

2 comments:

Philip said...

the "powers that be" scrambled to convert this debt exposure from private institutions to the public ones

Pretty much the same thing that happened in the U.S. after 2008.

Aizino Smith said...

Michelle Bachman was against the bailout, but according to many she's the crazy one.