Greece Has Its Fill of Austerity

by Costas Paris and Terence Roth

Wall Street Journal
September 2, 2011

The Greek government is saying that the country has taken about as much austerity as it can stand.

“It’s killing us,” says one Greek cabinet minister.

Athens can’t force through another round cuts to pay pensions and social services: “An angry population will take matters into its own hands, the government will collapse and we may end up with political crisis in a near-bankrupt euro-zone country which nobody will know how to control.”

The suspension of talks between Greece and its creditors Friday highlights the Greek dilemma. Slow economic growth and increased budget deficits move the European Union, European Central Bank and the International Monetary Fund—the “troika”—to demand still more cuts to cover the gap. The Greeks see that as a recipe for a protracted recession, chronic deficits and an unhappy population.

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