I've been wondering why Greece is so fucked. Turns out, it's not because of austerity or debt. It's not because of demographics or a lack of monetary or fiscal policy by the EUCB. And it's not because of Merkel. Greece is totally fucked because of the completely broken tax system which prevents the government from actually collecting the taxes that need collecting, and because of a political system which makes taxing the rich (particularly the celebrity-rich) impossible. For example you can look at people who were brought in to try to fix the problem, but who were completely unable to do so because everyone from the Finance Minister to the lowest level tax collectors doesn't actually do their jobs. Even when they try manfully and spend a huge amount of effort on high-publicity stunts, they don't recover more than a tenth of what the delta is. Page two is particularly telling; basically, people don't trust the government, so they don't pay their taxes if they can possibly avoid it. Then there's the question of tax morale, and it being cheaper to buy yourself massive tax loopholes than to pay your taxes. How do you fix a problem like that? The EU - well, Eurozone, I guess? - has a massive carrot (the Greek debt obligations) and somewhat of a stick (expulsion from the Eurozone?) but I don't see what solution will actually work. When it's cheaper to just cheat on your taxes and bribe the tax collector than it is to pay your taxes, and there's no likelihood of serious consequences for you personally, the system is broken. It's the age of civilization. You can't just start chopping off heads, China notwithstanding. So how do you solve it? Have Greece hand over their tax collection to Germany? That seems completely politically and culturally impossible. Wait until they fix their own shit? That basically means cutting them off and dealing with the fallout, then letting them rot for a while. Highly suboptimal in its own right. For bonus points, and fuck if I know if this site is actually legit, but apparently Greek GDP has been going steadily down, unemployment is rising, and the proportion of the economy that's a "shadow economy" and entirely untaxed is estimated as being 20% to 25% of GDP, literally the worst of the OECD countries and almost triple that of the USA. Incidentally, that last link is to paper published by the South Eastern Europe Journal of Economics, SEEJE. I was unable to, on a cursory search, find any strong information for or against them as a journal.