Our children will foot the bill
In 1985, when the current account balance reached 8.1 percent of gross domestic product (GDP), the government at the time devalued the drachma and enforced a two-year stabilization program which brought about a 15 percent decrease in real salaries. Right now, the current account deficit is at an all-time high (14 percent of GDP) and it was announced on Wednesday that this number is growing. Yet, this did not ring any alarm bells – no one seemed to be paying much attention. Often things that ought to cause a stir, don’t. The government is hoping for silence because the data proves that all the bragging about a strong economy is a joke. The opposition, in turn, seems not to comprehend the problem nor does it have the gumption to push for much-needed reforms. But, after all, the numbers simply reflect the economy’s structural problems. What do they tell us? That our economy is not competitive, that the products we want to sell are not satisfactory to foreign markets. That we lack specialization: The Greek economy focuses too much on the service sector at the expense of industry and manufacturing, while just 10 percent of our exports are high-technology products. We are self-taught: We do not promote rigorous training because this requires economies of scale and the adoption of new technologies. We are small-time businessmen: The percentage of businesses with less that 10 salaried employees in Greece is the biggest in the EU 27. We have low productivity: Productivity in Greece is the lowest among the EU’s 15 original members, with the exception of Portugal. So, self-satisfied in the fact that we are in the safe eurozone, we avoid dealing with our economy’s downslide and the constant erosion of our productivity. Resting on our laurels, we accrue debt to import and consume more than we produce and, without a care in the world, we bequeath that bill to our children.
