Not for the first time in her modern history (see Chapter 1), Greece is having grave difficulties with her public finances. A series of Government Ordinary Budget1 deficits run in the 1980s in order to curry favour with the electorate, plus pervasive tax evasion, have placed Greek governments in the 1990s in a vicious circle of running deficits (that is, borrowing) in order to service what is, apparently, EU’s third largest public debt. In the same vein, all Greek governments’ singular failure to privatise almost anything adds to the budgetary difficulties, themselves a result, in part, of Greece’s populist version of democracy.
KeywordsPublic Debt Budget Deficit Informal Economy Political Business Cycle Defence Spending
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