That’s it? That’s the best they could come up with? After four months of putting their neighborhood-class economic heads together, the financial advisors of the Looney Left SYRIZA party came up with raising taxes to save Greece?
Good idea: raise taxes in a growing recession, months after a recovery was looming. At least that won’t encourage tax evasion and foreign businesses are probably lining up to pay 29 percent taxes plus a 12 percent surcharge on their profits.
I don’t think they’ll go to other countries with rates half that and less when they can contribute to the recovery of Greek oligarchs and politicians. Why would a business stay in Greece – or come to Greece – when it go could right next door to FYROM or Bulgaria, where many were already fleeing, and pay 10 percent?
There are no patriots to be found among business executives, especially Greece’s shipping industry which, despite a promise by Finance Minister Yanis “The Gambler” Varoufakis to “crush the oligarchy,” have conveniently been left out of the new round of tax hikes breaking an anti-austerity campaign promise of Prime Minister Alexis “Che” Tsipras, who’d rather be ruling Cuba or Venezuela.
The Tsipras Plan goes after workers by making them pay far higher contributions to a failed pension system, and taxes tourists, shoppers and businesses – except for those shipping tycoons who in 2013 had 3,669 vessels, or 23 percent of the world’s fleet and paid no taxes – none, zero, tipota – on international earnings brought into the country under rules incorporated in Greece’s constitution in 1967.
Tsipras’ coalition, which includes the otherwise irrelevant Co-Dependent Greeks, on Feb. 20 was given a four-month extension on bailouts on the promise to come up with a credible – it should have been “sane” – list of reforms.
That was designed to release of a delayed 7.2-billion euro ($8.1 billion) installment from the heartless troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) that wants 100 percent tax hikes, 100 percent pay and pension cuts and balls-and-chains locked around the ankle of the few Greek workers who actually work.
A pox on both the houses because the troika wants relentless pay cuts, tax hikes, slashed pensions and worker firings, while Tsipras wants none, and wanted to keep the same breakneck pace of spending that the New Democracy Capitalists and the vanishing PASOK Socialists used to bankrupt the country.
Tsipras said he would never cut pensions again, but to keep that word had to break his other vows, especially hammering people and businesses with counter-productive taxes that history shows drives down revenues and encourages more tax cheating in a country where you can’t hit a golf ball downtown without hitting one.
Predictably, his crew, especially spokesman and paid liar Gavriil Sakellaridis are spinning that SYRIZA won, but forget to tell their own Members of Parliament, a big core of whom are up in arms over what they – not me – described as brutal terms that their leader was forced to accept, although there wasn’t much room left on a plate full of crow and his own words.
“There is full comprehension that there are measures in the proposal that are harsh, and they are measures that under different circumstances, if it was up to us, there was no way we would have taken,” government spokesman Sakellaridis Antenna TV.
First, it was up to them and they knew the circumstances coming in, but, as did all previous political leaders, lied their asses off just to get in power and try to get as many spoils as the could, only to find there weren’t any left.
Greece needed real structural reforms, not tax hikes – and what happened to that promise to get after tax cheats who owe 70 billion euros. If a fraction of them were held to account, arrested and prosecuted or had their assets confiscated, the tax hikes wouldn’t have been needed.
Instead, in real and disguised tax hikes, Tsipras is going after the very people he vowed to protect while whacking businesses, tavernas (with a 23 percent Value Added Tax), tourists and shoppers too.
Here’s what the Bloomberg news agency said Greece offered:
• Increasing national healthcare contributions – a levy paid by pensioners – to an average of 5% of pension income, up from 4%
• Introducing healthcare contributions for supplementary pensions, at a rate of 5%
• Raising social security contributions for supplementary pensions from 3% to 3.5%
• Increasing pension contributions for those working towards retirement by 3.9%.
At least Tsipras got it right in one area, cutting the defense budget by 200 million euros ($223.81 million), although it’s little more than symbolic and barely more than the cost of one F-16 plus some jet fuel.
Tsipras still will be left in the contradictory position of being a far, far-leftist leader whose country still spends about 2.2 percent of its Gross Domestic Product (GDP), proportionately the most in the world except for the United States.
Now he’s saddled with a plan doomed to fail because it won’t bring in more, or enough revenues. It was liberal John F. Kennedy, not a conservative Republican, who put it best: “It is a paradoxical truth tax rates are too high today and tax revenues are too low, and the soundest way to raise the revenues in the long run is to cut the tax rates.”