Starter for ten, diagnosis whose public finances in the Eurozone are the most wrecked? Ok the graph gives the game away, levitra but I for one expected Greece to top the charts for deficit running government. After all, sick we are often told that those Greeks aren’t the best for collecting tax. You could certainly be forgiven for thinking that those “lazy Greeks” haven’t been addressing their problems, while we have been taking our medicine.
We often hear senior German politicians saying that Greece has to commit to eliminating its deficit, as if it has made little effort to do so already, or at a very slow pace (some senior German politicians have described giving money to Greece to be “pouring water into the desert”). The reality is somewhat different. Serious efforts have been made in Greece to get the public finances in order and now they are no longer the country with the largest deficit. There may be huge public disquiet and political fallout from these unpopular measures, but Greece has made significant steps towards bringing about a balanced budget. While Ireland may take the plaudits for tackling these issues without any protest or public outcry, it does not hide the fact that Ireland had the highest deficit of all Eurozone members.
It is also noteworthy that 11 out of 17 countries are in breach of the stability and growth pact rules that countries should have deficits of no more than 3% of GDP. It shows what an inflexible rigid rule this is. There has been no real desire up until now to enforce these fiscal rules, particularly when the larger countries are in breach. While there is now more appetite for a fiscal union, one would have to be sceptical about the potential enforcment of these rules. The new fiscal stability treaty, ratified here in May provides for bringing countries to the European courts of justice if they do not comply with the new rules. If past performance is any guide this will be discarded with once one of the big nations is in breach. Germany (and others) blatantly ignoring the stability and growth pact in 2002 undermined those budgetary rules. Who knows which country will be first to do so with the new rules.