I have sworn off factoring the news relating to what form Greece’s default will take in my assessment of the financial markets, but I still follow the news. Here is perhaps the biggest “head news” bombshell of this saga. It appears as though there has been little seriousness at all about the debt crisis in the Greek government. Here is the lede from ekathimerini in Greece fails to collect tax penalties:
Had the government been able to collect just a third of the fines imposed for tax evasion and other tax-related offenses over the last two years, Greece would not have had to negotiate almost 3 billion euros in savings for 2012 with the European Union and the International Monetary Fund as part of its new bailout agreement.
This conclusion can be drawn from the statistics provided to Parliament on Thursday by Deputy Finance Minister Pantelis Economou but also by the data that he did not share with deputies.
Economou informed Parliament that the state had issued penalties worth 8.6 billion euros over the last two years, but what he did not share with lawmakers was the fact that a negligible amount of these fines have been collected.
Sources told Kathimerini that only 1 percent of the 8.6 billion euros has in fact been collected, meaning that less than 100 million euros has entered public coffers. These figures underline why Greece’s lenders no longer take into account in their assessment of the Greek economy any projected revenues from fines on tax evaders and other offenders.
It has previously been reported that tax collectors live very well in Greece. Perhaps the tax collectors considered that there was a public-private partnership between the government and them, external debts be damned. One has to wonder what really happened.
We will just have to see what ensues. It’s looking to this observer as though the Greek government accepted hundreds of billions of euros in loans over the past decade with little if any intent to pay much if any of it back. Why the lenders kept lending is unclear.
This news fits with an “America First” investing strategy.