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Shocking Austerity: Greece’s Poor Lost 86% Of Income, But Rich Only 17-20%
Submitted by Keep Talking Greece
Greece’s unbalanced austerity and drastic increase of poverty. The poorest households in the debt-ridden country lost nearly 86% of their income, while the richest lost only 17-20%. The tax burden on the poor increased by 337% while the burden on upper-income classes increased by only 9% !!! This is the result of a study that has analyzed 260.000 tax and income data from the years 2008 – 2012.
According to the study commissioned by the German Institute for Macroeconomic Research (IMK) affiliated with the Hans Böckler Foundation:
- The nominal gross income of Greek households decreased by almost a quarter in only four years.
- The wages cuts caused nearly half of the decline.
- The net income fell further by almost 9 percent, because the tax burden was significantly increased
- While all social classes suffered income losses due to cuts, tax increases and the economic crisis, particularly strongly affected were households of low- and middle-income. This was due to sharp increase in unemployment and tax increases, that were partially regressive.
- The total number of employees in the private sector suffered significantly greater loss of income, and they were more likely to be unemployed than those employed in the public sector.
-From 2009 to 2013 wages and salaries in the private sector declined in several stages at around 19 percent. Among other things, because the minimum wage was lowered and collective bargaining structures were weakened. Employees in the public sector lost around a quarter of their income.
-The extent of the wages cuts were grossly overstated - at least ten percentage points, the study researchers estimate.
Unemployment & Early Retirement
Unemployment surged from 7.3% in the Q2 2008 to 26.6% in the Q2 2014. among youth aged 15-24, unemployment had an average of 44%.
Early retirement in the Private Sector increased by 14%.
Early retirement in the Public Sector* increased by 48%
The researchers see here a clear link to the austerity policy, that’s is the Greek government managed to fulfill the Troika requirements for smaller public sector. However, this trend caused a burden to the social security funds.
* Much to KTG’s knowledge public servants with 25 years in the public administration rushed to early retirement in 2010 out of fear of further cuts in their wages and consequently to their pension rights.
Taxes
Taxes were greatly increased, but they had a regressive effect.
Since beginning of the austerity, direct taxes increased by nearly 53%, while indirect taxes increased by 22 percent.
The taxation policy has indeed contributed significantly to the consolidation of the public budget, but by doing so the social imbalance was magnified.
Little has been done against tax avoidance and tax evasion, however, the tax base was actually extended “downwards” with the effect that households with low-income and assets were strongly burdened.
Particularly poorer households paid disproportionately more in taxes and the tax burden to lower-income rose by 337%. In comparison, the tax burden to upper-income households rose by only 9%.
In absolute euro amounts, the annual tax burden of many poorer households increased “only” by a few hundred euros. However, with regards to the rapidly declining of incomes and rampant unemployment, this social class was over-burdened with taxes.
The Poor suffered more
On average, the annual income of Greek households before taxes fell from €23,100 euros in 2008 to just below €17,900 euros in 2012. This represents a loss of nearly 23 percent.
The losses were significantly different to each income class with the poorest households to have suffered the biggest losses.
Almost one in three Greek household had to make it through 2012 with an annual income below €7,000.
Income losses 2008-2012
1. Class: i.e. 10% of Greek total: households that have lowest income: loss 86%
2. and 3. class: loss between 51% and 31%
4. – 7. class: households with higher income: loss between 25% and 18%
8. Class: 30% of Greek total: households with the highest income: loss between 20% and 17%.
Study Summary in German here
Full Study in English (143 pages) in pdf here
Shocked?
KTG has been saying this since 2011, has been saying this and criticizing every new taxation law: that the burden to the poor, the low-incomers, the low-pensioners and even the jobless was over-proportional when compared to the economically better society classes.
I wonder what a study will bring in results for the years 2013 and 2014 that were the worst years of austerity.
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Well duh. Wonder what it has been for 'mericans? Remember "trickle down" eCONomics..?
At least Reagan had the fucking sense to send over 1000 of the bankers and financiers to prison after the S&L crisis (the first time these fuckers tried to securitize/financialize mortgages...)
Xinhua: China And Germany Deepen Financial Cooperation, Germany Joins AIIB And Supports RMB Inclusion Into SDR https://www.bullionstar.com/blogs/koos-jansen/xinhua-china-and-germany-d...
So the plan worked the way they wanted. Too bad the public won't learn from this and demand real change,
When will the Greeks contemplate returning the almost new, never used equipment to Germany?
http://www.zerohedge.com/news/greece-spends-bailout-cash-european-military-purchases
Greece Spends Bailout Cash On European Military Purchases
just-released report, Arms Export in 2010 after the Portuguese, the Greeks - a state on the verge of bankruptcy - the largest buyers of German war weapons.
"In Greece, the arms deal as a give and take anywhere. What do I get in return when I buy a tank with you? Always it was also about compensation. Any politician who signed a treaty with the Germans hoped that a corresponding portion flows back. "
Those losses percentage wise sound like the Great Depression 2.0
I guess its starting in Greece, only a matter of time before the contagion spreads, the rot is everywhere.
So how long till the men start marching down the street wearing arm bands for the Golden Dawn?
There wil be a distaction before that is ever a real threat.
Yes, i.e. "9/11", allow us to print more money and tax you more in order to "save" you.
Fuck em.
Almost as if we have seen this movie before.
Simple, refuse to use funny money fiat. Don't use banks. Fuck the bankers.
https://www.youtube.com/watch?v=BatgvSN2Z7M
If Greece was smart, they'd surrender and put the ECB on the hook for a big bailout using the standard 'austerity' then spending like there's no tomorrow and keep spending till they won't pay you any more. Now defualt on everything and drag the EU into court and tie them up for a few years.
That was mt first thought too Laws of Physics. I would love to see the same stats for The Great We Say Its Ended (But Its Not Really Over) Recession for the US.
Socialism/leftism performed as designed.
save the banks and corrupt rich at all costs
fascism more like it
That as well. But that is the evolution, not the original design. Just as communism turns to totalitarianism as it takes hold.
It's theftism or greedism. Since we're talking 'isms.'
"I ism coming boss!"
The difference between fascism and socialism is one of degrees, not ideology. Socialism is fascism taken to a whole other level. Greeks still couldn't figure out this system, which caused their ruin (no, hate to tell everybody but Goldman didn't bankrupt Greece). Instead, they elected a bunch of socialists dimwits in Syriza who were going to continue these idiotic policies.
Can we please stop with this socialism/leftism BS? Some people are still talking about stupid labels - socialism, leftism and all that other crap. All these terms have lost their meaning quite a while ago. Labels mean NOTHING today. There is no difference - left or right, black or white and whatever. There's the psychopatic elite and there's the rest... socialism for the 1% and capitalism for the rest... that's the design.
No, we can't.
Right :) But, seriously, what is the actual difference between socialism and capitalism these days? Is it socialism for Wall Street and capitalism for Main Street or how does that work? What't the difference between a democrat and a republican in the US these days? My point is that the ideological lines between systems and movements have blurred to the point of becoming completely irrelevant. People are confused and being offered a spectacle, an expensive farce called an election and people think - oh, this party is rubbish so I vote for the other one or that candidate is better than the other one (Bush or Clinton, - very tough choice indeed...) So what difference does it really make? The true masters are behind the scenes, they put money on BOTH (there was a good article here about the ROI of this 'investment'...) so if that is the case why are people even bothering to vote? Don't they see that it makes no difference whatsoever? I guess some people think choosing the 'lesser evil' or something along those lines... still, makes no difference as long as the parasitic psychopaths keep pulling the strings.
Sounds like it's time to start throwing bricks.
Almost one in three Greek household had to make it through 2012 with an annual income below €7,000.
These shall be known as the good ole days in the not too distant future.
> Revolution
> Revolving door
--your choice!
I'm sympathetic to the actual Greek "Producers". If you're living a euro-socialisim nightmare that turns into an austerity imposing foreign takeover of your economy it could be seen as an improvement... Not saying them selling out their Greek brothers to the Troika is a good thing. But to be fair the Greek government had been selling them out for some time. Morality and ethics get really cloudy in a socialist state.
Yes, precisely why you go long black markets and sharecropping.
What the Greeks need to do is vote for even more socialism and that way "they" will get to take all of the rich folks money and redistribute it! Cause some folks have to much money!
None of the crap that is happening to them is a surprise or should be a surprise to anyone.
The Greeks are just as stupid as anyone else that thinks big gubmint will take care of them.
So how is it working out for you so far? Cause it's about to get much worse!
a modern day reactment of 1930's...before your eyes! Can hardle wait for the 1940's
Modern slavery is much better for slave-owners.
Me thinks the slaves of the Spartans had it better than today's destitute Greek lower class. And those slaves had war declared upon them once a year so Spartan's could kill them legally...
It's draghinormal, poor greeks :(
I sure wouldn't have bet against this outcome.
Wanted to correct the author for using "Shocking" in the title, but then they finish the article with the same statement. What dope reading this thinks austerity plans benefit the needy?
''Austerity is merely code for NOW IT'S TIME TO PAY US THE INTEREST''---trav7777
HAHAHA
I am surprised the wealthy took a hit at all.
Pretty sure that the Socialist Party leaders won't take a hit. In fact, they will see their incomes grow by leaps and bounds - while they complain about the 1% for showmanship.
The socialist party (PASOK) is polling under 2.5% at the moment; back in the 2009 election it got over 40% of the vote. Papandreou has formed his own party (polling at a glorious 1%) and Venizelos (the fat guy, FinMin during PSI and current PASOK leader) may be implicated in several arms deals from the turn of the century that the new government of SYRIZA (left, never in power previously) is now examining.
They may be taken to account yet. Tsoxatzopoulos, former DefMin and almost-leader of PASOK has already been imprisoned for taking bribes in a submarine contract with a German (of course) company.
The biggest proof of the small-medium businesses systematic extinction on the altar of the big corporations.
Best possible outcome for future of human species is for Greece to completely implode economically and civil war that totally destroys the entire country and wipes out most of the population. This will be Greece's contribution to the modern human world.
THEN rest of world can have a good example of the consequences of socialism and government corruption run amok, since ALL other proletariat democracies are racing to pass Greece into the cesspool of ruin and IF people wake up, then there is still time to slam on the brakes, ie recycle ALL the socialist parasites.
So long as the people accept being ruled by the bankers printing money out of thin air, they will be fleeced. https://www.youtube.com/watch?v=p5Ac7ap_MAY
I am sure that, if similar studies were performed in Argentina or Brazil or Ukraine, the results would be similar as well. We have had plenty of studies made in America to show that the situation is similar here.
Crony Capitalism is as much responsible for this as is Limousine Liberalism. The two elitist systems converged and begot this monster called Globalism. So now, even if some populist like Theodore Roosevelt (or Morsi or Putin), coulld emerge and secure an overwheming majority of the public to support him, "Laws and Treaties" will frustrate every attempt to put the economic-social order back into balance.
No such thing as crony capitalism. There is only capitalism. It's not a static system, but rather a system that grows and evolves. It starts as a multitude of small efficient businesses, and over time consolidates into a handful of gigantic economic entities. When they reach sufficient size and wealth, they purchase the politicians as they did in the US and then begin the process of harvesting the working class. In its last stage, it collapses into a neofeudal system with a tiny handful of super wealthy, and a vast sea of serfs and slaves. The disaster you see today is just part of the normal lifecycle of capitalism.
When Socialists take over, everyone eventually loses 100% of income.
I see that plan is unfolding.
Wrong. Try again.
They are all about sharing zero equally!
Shocking? To fucking whom is this shocking? Those who still have their heads either buried in the sand or up their asses and don't believe that there was a global class war, and it was won by the rich?
Yet another shining Socialist success story to throw on the wood pile!
Yes because Thatcher's policies have delivered an economic paradise unto the UK, right? The mind boggles at these idiotic statements about this or that ism, the whole damn point of policies by any government during the last few decades (or, well, ever) has been to shift wealth towards the very rich - in ANY country. Even in Soviet Russia policies favored the party over the rest of the folks!
The worst part is that as wide as the wage gap was between public sector and private, each crisis widens the gap further. Socialist countries always become more socialist until they achieve full socialism. If you haven't emigrated by then, you'd better know which weeds are edible!
And most people don't, so it will be the other white meat for dinner. You know, Constantine who used to live across the street until you caught him, slow roasted him over the coals, and devoured him.
Oh, he was an illegal immigrant. He chose to ignore our nation's laws, and so did I.
Comming to most mirrors in Merica shortly. For many is it here now.
Lots more weopens being loaded shortly there after. Milestones
"We taxed some asses of some folks"
Nobody paid anyway!
The socialism was was workin' great 'till the other guy ran outta feta!
http://www.tradingeconomics.com/greece/government-debt-to-gdp
Yeah that one-time 14% drop in 2013 followed by an 18% surge is SHOCKING austerity. Keep pushing the austerity lie. Let's wait for that fiscal 2015 drop. Any second now.
When they say that nominal gross income dropped by almost 25%, I wonder how much just went off the books? Im seeing more and more of that here in my area of mid-atlantic US and it isn't just plumbers and hair dressers.
Yeah...um..'shocking' ? Not really.
Socialist's generally don't have very good credit ratings.
The Western media is totally silent on the subject of Austerity in Ukraine. We all know why, because the West is backing the Junta. But that does not mean reality is not going on right now. Kiev's main airport just saw a mass firing of staff. Coal mines have been closed, all staff fired. Public servants are next, with 500,000 to be fired. Most of the major defense industries, rockets and aircraft that serviced Russian customers are shutting down, 10,000 of high tech jobs will go, the layoffs have already started. Wages everywhere are crashing. But the West says nothing, because the media has been ordered to be silent. We can read all about Greece, but not a word about a country far bigger, in the grips of a brutal depression that has only just begun. Don't expect CNN to cover it.
But CNN is covering the former allies of Amerikka joining the AIIB, right ?
Not to worry. Asst Sec of State Victoria Jane (FU) 'Toria' Nuland (nee:Nudleman) Kagan will be handing out all the cookies they wil need!
And if it ever does happen to get reported it will all be blamed on that debbil Putin.
you can't spell "fEUdal society" without EU
I hardly think anyone wants Greek people to be their military slaves. Nor do I believe that the EU would provide military protection for the obedience of Greece.
Not surprising. For the educated, taxation on the poor is mainly on labor, wages.
While taxation on the wealthy is generally on assets.
Let's say we tax both equally at 25% (even though the tax rate probably isn't like it isn't in the US).
It is easier and more comfortable for a billionaire to pay 25% on assets and do nothing but live the high life.
While with the wage earner, a 25% tax makes a big difference. Even if you were to tax the wealthy at double (50%), the lower wage earners still feel the pain of the 25% more then the wealthy feel pain.
---
Everyone is heading in this direction. Don't look at it emotionally. You get caught up in headlines and class warefare that way.
Well the flaw here is the assumption that only "billionaires" and "rich" own assets. Taxing assets hurts the everyone. Every homeowner and every fool with a 401k is hardly anywhere near "rich".
Where is Zorro? Take from the rich and give to the poor (and have lots of babes with low cut blouses).
Taking from the rich to give to the the poor is the end game!
Zorro should learn to respect private property rights.
It seems that Zorro has been replaced by Dennis Moore:
https://www.youtube.com/watch?v=qLkhx0eqK5w
The ultimate goal of communism is taking over the means of production. That is when the real pain & suffering starts for all!
Just wondering where in the unicorn pasture I can find the austerity. Thanks.
Well I, for one, am shocked, SHOCKED I tell you, by this report from the Germans.
(I understand the sub-title of this report is "We fucked them in WWII and we are fucking them again", but I do not read German well, so maybe I got it wrong?)