There was some hope that Greece, which for the past few months was desperately trying to show it has a primary surplus when in fact it was merely shoving unpaid bills under the rug, was at least getting its runaway deficit situation under control. This, despite what many sensible people pointed out was the return of nearly daily strikes, which meant zero government revenue as zero taxes could be levied on zero wages. Turns out the sensible people were again right, and the Greek and European propaganda machine has failed once more as the Greek Finance Ministry just reported that despite big tax hikes demanded as part of austerity measures by international lenders, tax revenues fell precipitously in January, with the Greek Finance Ministry reporting a 16 percent decrease from a year earlier, and a loss of 775 million euros, or $1.05 billion in one month.
This means that the government took in only €4.05 billion ($5.47 billion) in tax revenues in January, far short of its target of €4.36 billion ($5.89 billion), a $420 million shortfall in one month, which also came during an annual holiday sales period for shops who are bleeding customers and shutting down by the thousands.
It is all downhill from here as the feedback loop of more spending cuts is activated to offset declining revenues, leading to even less revenue, and culminating with the complete collapse of Greek society.
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Duh...When you tax something you get less of it.
ReplyDeleteSurprise surprise! Wait until the full tax implications of the Obama/commie care kick in, can anybody say GREECE.
ReplyDeleteIt's no secret that the more you tax, the less revenue the activity generates. Incentives to produce more go down, while the benefits of cheating the system go up.
ReplyDeleteThe powers that be are not so stupid that they don't understand that this is the case. And since they want higher taxes, they obviously want a different kind of outcome than they are telling you.
I'll bet anyone a dollar that when the full-on depression hits Greece, foreign interests will be there to snap up property and businesses for previously unheard of prices. This whole thing is, essentially, an economic siege on the people of Greece.
The same thing is playing out in America. Study up on Greece, Spain, and how things went differently in Iceland. Plan appropriately.