Saturday 29 May 2010

IMF's "Herculean" task in Greece

Some of the best coverage of the Greek debacle has come from the Wall Street Journal. Most of the European coverage has of course been heavily slanted towards national interests, with the bulk of the German reporting coming across as unsurprisingly harsh. The most recent WSJ assessment of the situation in The Word on IMF's Task in Greece: Herculean is no exception and is well worth the read. One thing caught my eye that deserves to be highlighted.

"For Savvas Tsakiris, the coming changes mean lower profits, lower pay and more competition. Mr. Tsakiris, a 48-year-old pharmacist in Athens, fears deregulation will mean "handing over the profession to multinationals that are not pharmacists, but entrepreneurs.""

My question to Mr. Tsakiris is this; is it really any better for government bureaucrats to have control over every square inch of Greece's legal economies that multinationals? Obviously, one of the main reasons for Greek's current crisis is the lack of economic growth that is directly related in part to the country's heavily regulated method of doing business. According to the economic freedom index as published by, Greece ranks below such free-market titans as Mexico and Albania. Why do many persist in thinking that bureaucratically directed markets are safer for them than a free-market that allows more competition? At any rate, we'll see if the Greeks are able to muscle through some rather tough reforms. It has been my experience that people are reluctant to give up the their float in the dole parade without a fight.

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