The Greek Debt Crisis – 5 Minute History Lesson

The Greek Debt Crisis - 5 Minute History Lesson

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The Greek Debt Crisis was one of the more recent economic disasters that required three bailouts. While Greece is far from out of the woods, here’s a brief history lesson on what happened.

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Faster Does It by Kevin MacLeod is licensed under a Creative Commons Attribution license (

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18 thoughts on “The Greek Debt Crisis – 5 Minute History Lesson

  1. When Germany will give us the 100.000.000 money who owes us from World War II,we will not have debt.

  2. Just to mention that by the time you made the video Greece was having a fiscal surplus already (for a couple of years I think), which of course doesn't mean economic recovery. On the other hand, you seemed much more favorable to the surplus of 2014, which you interpreted as actual recovery even though the economic was still shrinking, let aside the social impact of the austerity. What I mean is that the image of a reviving economy before the 2015 elections is quite biased, as the actual policies enforced by the Syriza government were the same and as you recognize they didn't lead to growth nor the decrease of the debt, despite the fiscal surplus, so we could agree I think that neither the previous government would have achieved an actual recovery, even if they have stayed on power. As for the fact that Greece could borrow in 2014 in open market didn't reflect economic recovery but it should be viewed as politically motivated. The investors were prompted to start again lending money to Greece by the ECB, in order to help the government to present the image of a healthy economy in the interior for the upcoming European elections. The fact that investors didn't have a problem to borrow money to such a bankrupt state (the dept-to-gdp ratio never decreased during the crisis) is only due to the fact that they know that ECB supports this debt, that is that they would not leave the country default no matter what. The same holds today, when the debt-to-gdp ratio is over 200%, there is no growth compared to 2019 but open markets still lend money to Greece. All that said just to state that the program that was supposedly interrupted in 2015 (in practice it wasn't) wouldn't bring recovery, and it didn't up to today.

    Besides this, I have to admit to that the info presented in the video is quite accurate, and in five minutes I suppose you couldn't go in that detail, but the image you implied about 2015 is very much used in the political discourse in Greece to blame the people for voting against austerity in 2015, that with that choice they blew up a program of a supposed economic recovery.

    P.S. The photo with the too many Greek flags doesn't show an anti-austerity protest, but a nationalistic demonstration about a dispute with North Macedonia, and doesn't reflect the political imprint of the anti-austerity movement.

  3. I love how you present it as if everything was going perfectly fine and dandy until those idiot from Syriza came around and ruined everything.
    Yeah, it's obvious you are right leaning and let that affect your judgement.

    I guess you'd also prefer to let people starve and be homeless aswell, right?
    I mean, those kinds of problems probably never affected you…

  4. Yup. Amazing. Goverments that we didn't elect taking actions that we had no say in fucking us over. Very nice.
    Good job democracy

  5. This is a perfect story to explain why I'm against excessive government spending. Thank you.

  6. Here’s an essay I wrote back around 2012 on Greece’s financial crises.

    Greece has several interacting issues:
    1. Its debt is about 3X its 200 billion Euro GDP and also about 2X the value of government assets.
    2. Its tax receipts don't cover government outlays for services and government worker salaries.
    3. Citizens have no faith in its corrupt government and so resent paying taxes, and many avoid paying altogether.
    4. It has run out of sources of new debt financing.
    5. Its weak political structure hinders real reform.

    The underlying issue is the fact that Greece is not a highly industrialized country like Germany, and yet its government has promoted a lifestyle for its citizenry on par with the rest of Europe. This disparity has been ignored for too long and has caused Greece to live beyond its means and run up unserviceable debts and deficits.

    Given the above problems, there are very few real solutions:

    a. Greece could privatize more government assets (it began doing this in ernest about a year ago).
    Privatization of public assets can yield three simultaneous benefits:
    – Privatization allows the government to raise cash which can be used to pay down its debts.
    – Privatization eliminates government costs in maintaining and operating the assets that are sold.
    – Privatized assets are often more efficiently managed by private enterprise, which then pays taxes on the ownership of the assets (think property taxes) and on any profits generated from the ongoing operation of the assets.

    The problem of privatization is that, on its own, it doesn't fully resolve the underlying problem. It can help to reduce government expenditures, but unless the government has a lot of assets to privatize, it will run out of assets before it gets its house in order.

    b. Greece could implement austerity programs to reduce the costs of operating government services. Unfortunately, cutting spending can deepen the country's recession. Greece does not have the alternative option of monetary easing, as it doesn't control its currency (the Euro). But if you are spending more than you are able to take in, then you really do need to cut spending, and so Greece should embrace the austerity measures being demanded by its creditors.

    Greece could, and should do both A and B, above.

    c. Greece could default on its debts and leave the Eurozone. This would allow it to print its own money to fund its government, but the value of that money relative to other currencies would greatly diminish the wealth of its citizens, many of whom are already on the edge of being totally insolvent.


    In the end, the problem of Greece is that it's a country with mostly agricultural resources and not much in the way of industry compared to countries like Germany, for example. Greece should have remained a small country with a small government until it, on its own, could have caught up to the rest of the more industrialized nations of Europe. The Eurozone may ultimately not hold since rich industrialized countries that run a trade surplus (because they produce lots of output that is in high demand) will never be happy supporting the populations of less industrialized countries that run a trade deficit at a standard of living nearly equal to that enjoyed by the richer, more industrialized nations. Due to differences in geography, life philosophy, and even luck, these countries are not equal and cannot continue to pretend that they are, and that their citizens all deserve the same benefits and standard of living.

    If Greece doesn't exit, Germany, eventually, will. If Germany leaves, or even France, the Eurozone is dead (ergo, Greece will exit because all 17 members will exit all at once).

  7. As someone who works in finance/investing, I'm honestly CONSTANTLY in SHOCK when I discover just how many entities are as short-sighted as a man who is currently on death-row.
    The infrastructure of most economic systems is engineered to create more through-put, yes, yet this is done by substantially increasing volatility.

    Consequently, when times are good in the world, no major wars, no fanatical political regimes stirring the pot, no serious environmental catastrophes, one could argue the engineered economic systems are superior.
    HOWEVER, in times of chaos, these systems break-down. Always. Every time.

    The perfect microcosm for this is stock buy backs. (Some stock buy backs are valid strategic approaches, but many are invalid.)
    Company X makes a profit for the first time in awhile. Yet, instead of investing that money into something that promotes stability, or paying off some of their debt ahead of schedule, they buy back their own shares. This will make shareholders happy, and more importantly, attracts new shareholders.

    Then, when something unforeseen happens, and share prices PLUMMET, the Board Members throw their hands-up saying, "WELP, NOTHING WE COULD HAVE DONE!"

  8. I’m Greek/American, and it’s a shame that this five minute video told me more than I’d ever learn with some Greek articles I had found online.

    Doing a 1000-word essay about the Crisis that’s due tonight. Wish me luck!

  9. Bottom line Greece’s currency before the Euro was Drachma, how can a country adopt a currency that overnight is stronger than US dollar makes no sense!!! That means you have to trade all of you Drachmas in for Euros which means all of your costs go up by like 5x’s… this isn’t a debt problem its a currency problem. If Greece kept their own currency they would be prospering… how can let another country control your currency and print your money which is Germany.

  10. The next video will be about Sri Lanka, which was bankrupt recently

    But there will be no entity like "The Troika" to save us

  11. Aftermath of economic Prosperity period:

    Recessions, economic crisis, national debt: ALLOW US TO INTRODUCE OURSELVES

  12. Thank you God. You could have been born in Turkey. Annual inflation is 170%. ):

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