Eurocrisis: The Holiday, Like the Olympics, Is Over

Tourism in Greece this summer has been better than hoped, or rather feared.

On Monday, data from the Hellenic Statistical Authority (ELSTAT) revealed that Greece’s economy has shrunk to its 2005 level in the second quarter, the worst in the last eight years. Greece’s gross domestic product decreased by 6.2 percent (which was actually better than the 6.5 percent predicted).

Overall, Greece’s economy has shrunk 17.4 percent since the second quarter of 2008, which was the first quarter the country entered a recession. The Greek economy is 13 percent smaller than it was two years ago, leading some to say that it is not that the country is in a recession (for the fifth straight year) but a depression. A graph in the Guardian shows “how the Greece economy has been contracting almost non-stop since the start of 2009.”

As a former member of the Greek Vouli (Parliament), Elena Panaritis, commented: “We keep on pushing more austerity simply because we have to meet conditionalities, and there is very little done really in terms of growth.”

Germany’s economy minister, Philip Rosler, made it clear over the weekend that he is not happy with Athens’ “failure” to implement reforms and that “I’ve lost my illusions” over Greece’s being able to change. With other German politicians calling for Greece to leave the euro as they do not want to pay out more bailout funds for the weakest economy in the euro zone, Chancellor Angela Merkel, just back from a holiday of opera-going and hiking, has plenty to keep her busy for the rest of the summer.

French president Francois Hollande is also back from his vacation and, with August 13th the symbolic 100-day mark of his term, the honeymoon is quite over for him. Opinion polls suggest that, while a majority (57 percent) think he has kept his election promises (lowering his salary, raising taxes on France’s highest earners, withdrawing troops from Afghanistan), public confidence is waning about whether he can resolve the greatest problems facing France, “the huge public deficit, record 10 percent unemployment and the death of French industry.”

51 percent of those polled think that France is changing for the worst.

Hollande, who campaigned on an anti-austerity platform, is now facing the music as he confronts mass layoffs as well as “an uncompetitive labor market and an inability to pay” for France’s public services and generous welfare state. He must find 33 billion euros by raising taxes (that on the wealthy is not enough) and making budget cuts. Plus, he faces criticism from inaction on the protracted, bloody conflict in Syria.

Yes, talk of Greece leaving the euro for the drachma is again in the air. With commercial real estate markets in Italy and Spain having all but collapsed, murmurs about their continued membership in the euro zone may soon be more loudly voiced.

Related Care2 Coverage

Eurozone: A Not So Happy 5th Anniversary For the Financial Crisis

Eurocrisis: Euro Zone Is At Risk of a “Psychological Break-up”

Greece Rounds Up Immigrants in Athens, Will Deport 1,600


Photo Olympics venue built in 2004 in Athens by Metro Centric

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Benny R.
Benny R.2 years ago

The infrastructure should be partly used for sport, accommodation should be used to house many of London's homeless. Since Margaret Thatcher bribed the public aspiring to own their own place but living in council's property (social housing) the right to buy (at much reduced prices) in the 1980's, there is distinct lack of social housing ever since.

Especially homeless families and military veterans are the Great British scandal.

Michael Mifsud
3 years ago

All this baloney with respect to austerity measures and cut backs sound as hollow as the people who propose them The reality is that the bureaucracy in these backward countries is rife with corruption and self interest and what they do not want is their fairytale lifestyles, grossly inflated incomes and sense of superiority over the rest of the mob to be affected in any way. What Spain, Greece and Portugal are afraid to touch is the bureaucracy because it has become the real emerging Orwellian nation behind the scenes. The rest are watched and bullied with every form of taxation that will prevent them from getting off the ground. What is needed is a real application of civic concern and demolish the antiquated and unfair civil service structure handing the dismissed their indemnities in equal terms to that offered to mere mortals of the enslaved general public. Taxes should be removed or reduced and public spending cut down to the very basic needs run by a new breed of people genuinely motivated by contribution to their society with no millionaire bosses to destroy their motiviation. A model country with a broad smile on their hospitality (which is lacking in many of these so called tourist targets) and value for money will ensure the survival of the low economic grouping based on this export.

Cottage industries for every single thing that can be manufactured manually with added elegance i.e. the local stamp of personal touch . soaps, jewellery, carpentry, clothing

Diane K.
Diane K.3 years ago

Sounds like the economy isn't good anywhere in the world, right now. Maybe all the banks need to restructured?!$$$ Thanks for the article.

Debbie L.
Debbie Lim3 years ago

They always leave for vacation during the worst times... Thanks for sharing.

Toby Seiler
Toby S.3 years ago

Here is my solution. A Greek currency that is equity in all of the publics assets, including precious metals, real estate, and all property owned by the government. Set a value and issue a new currency, backed up by assets.

I suggest the same for the US by making a US Treasury Dollar, equal to a FED Reserve Note by law.

This requires a change from debt based money to equity or a combination, but stops the debt money monopoly on the the US money supply.. Give 10 years to spend money into existence funding government. Stop all income tax for 10 years.

Winn Adams
Winn Adams3 years ago


Magyar Girl
Past Member 3 years ago

Holiday/vacation? I haven't had one in 17 years.

Mukesh R.
Mukesh Ramteke3 years ago


Elaine A.
Elaine Al Meqdad3 years ago

What is London going to do with all the venues infrastructure, I wonder!

Terry Vanderbush
Terry V.3 years ago

thank you