Those numbers all sound HUGE don't they?
That's because compared to a household, economies run on SPECTACULAR budgets.
So, Germany has remitted 50Bn - sounds MASSIVE!
But, the current German debit is over €2,000,000,000,00, so €50,000,000,000 is not actually that much in national debt terms.
Also - what hardship has this caused? Were there big cuts in Germany to pay for this? Lots of people fired? Nope, because Germany can borrow for a pittance, so there was no actual sacrifice.
National debt, unlike household debt is never paid off. All you ever pay back on national debt is interest. At the moment Germany is basically borrowing for free:
http://refhide.com/?http://www.wsj....ive-yield-for-first-time-on-record-1424871074
What happened Greece is that interest rates went bat-shit-crazy on their government bonds, so paying back the interest became a problem. What should have happened is that the ECB should have stepped in to support Greece by lending it money at an affordable rate, and that could have been that.
Instead, the ECB, the IMF, and European Commission (the Troika) forced Greece to kill their own economy in the middle of a crisis on the promise that doing exactly the worst possible thing under long-established economic theory would actually fix their economy. It didn't - it made it all much worse, so now Greece is in even bigger trouble than when all this started! Telling Greece to keep doing what is making its economy sicker is nuts, and the Greek people have realised that an elected a new government with a strong mandate NOT to keep doing more of the same.
Doing the same thing over and over again and expecting a different outcome is insane. Why does anyone think the Greeks are going to accept that as a 'solution'?
Would you?
Imagine your doctor fed you something scientists have said for almost 100 years is toxic on the promise that an un-tested theory says it will cure you (expansionary austerity). You reluctantly try it for 5 years, and, unsurprisingly, you are not better, but sicker. When they doctor comes back and tells you you need to take MORE of this 'medicine', how would you respond?
So - Greece was forced to impose draconian cuts in the middle of a deep recession, exactly what economists have known for almost 100 years is the absolute worst thing to do in that situation, on the promise that it would create 'confidence', which would somehow create growth, which would lift the economy out of recession.
They tried that, turns out what we learned during the great depression is still true, and that doing exactly the same thing they did in the 1920s that extended the great depression, also extended the great recession. Imagine that. Repeating the same mistakes from a century ago gives the same disastrous results!
If something is not working, you STOP. You find an alternative, and you give that a go instead. That is what the Greeks are asking for. That is what the German Government is hell-bent against.
B.