It can be argued that at the very core and foundation of a country the most valued structure is the economy. At some point in time, an economy may be in crisis due to many reasons. There are several reasons that can portray an economy as stable or as unstable. The ongoing ominous financial crisis has had a massive impact on the country of Greece and its’ citizens as well. The causes and effects are not only interconnected on its’ national level but globally as well. How is it that a country can ensue and continue to go into a downward spiral so quickly? It is important, on a national and a global scale, to understand the implications and effects that it has had on the citizens. When it comes to the people and its’ country there is a livelihood to protect, every aspect of life should be taken into consideration. How a society rises to success and bounces back from misfortune, how it learns to adapt and function is determinant of its’ existence.
What’s the cause?
Euro
Greece is a member of the European Union, and shares the same currency (Euro, €) with 23 other countries (Rosenberg, 2017), which sit in a range of financial positions. The euro is being weighed down by countries collectively known as the ‘PIGS’, Portugal, Ireland/Italy, Greece and Spain (Applebaum, 2010), with Greece sitting in what is, perhaps, the worst position.
European Union
We suggest that the European Central Bank, in determining monetary policy for all of the eurozone, set rates that were too low for the economic conditions in Greece. A continued period of low nominal and negative real interest rates may have exacerbated sovereign debt bubbles, which Greece, as a euro member state, could not simply in ate away. In addition to the scal element that is often and rightly emphasized, we now add that monetary policy might also have contributed to Greece’s sovereign debt crisis (Seyler & Levendis, 2013).
IMF
Politicians
Michel Foucault argues a number of points in relation to power and offers definitions that are directly opposed to more traditional liberal and Marxist theories of power. Foucault believed that power is never in any one person’s hands, it does not show itself in any obvious manner but rather as something that works its way into our imaginations and serves to constrain how we act. For example in the setting of a workplace the power does not pass from the top down; instead it circulates through their organizational practices. Such practices act like a grid, provoking and inciting certain courses of action and denying others. Foucault considers this as no straightforward matter and believes that it rests on how far individuals interpret what is being laid down as “obvious” or “self evident”, institutional power works best when all parties accept it willingly. Foucault’s notion of power is a difficult notion to grasp principally because it is never entirely clear on who has the power in the first place, once the idea is removed that power must be vested in someone at the top of the ladder, it becomes much more difficult to identify what power is or where and whom it lies with. Foucault believes that we are used to thinking about power as an identifiable and overt force and that this view is simply not the case, because it is taken for granted that the above statement is true then it is much more complicated to comprehend power as a guiding force that does not show itself in an obvious manner.
Foucault’s investigation on governmentality, focused on the problem of personal subjectivity, is to care for the problems of “who are we” and problems that we are facing. Foucault also pointed out that, the main purpose was not on “what are we” but is to refuse to be “what are we”, his words are:
“The conclusion would be that the political, ethical, social, philosophical problem of our days is not to try to liberate the individual from the state and from the state’s institutions but to liberate us both from the state and from the type of individualization which is linked to the state. We have to promote new forms of subjectivity through the refusal of this kind of individuality which has been imposed on us for several centuries.” (Foucault, 1982)
What’s the effect?
From the bailout packages, demands have been harsh and have taken a toll on Greek society, this is all occurring simultaneously as the state is continuing to still be running a budget deficit and even experiencing a political crisis. The civil dispute has grown out of the unreasonable spending cuts. Instead of lowering the government workers’ wages, the statesmen started reducing the funding of social insurance, health-care system and even churches (Economides, 2011). Due to this the society has become restless, frequently participating in strikes and demonstrations.
And how does this fit globally?
The pursuit of profit in capitalism encourages competition and development amongst firms which in turn leads to lower prices for the consumer, who benefit from increased consumer welfare, and increased satisfaction. Capitalism has evidently become the most efficient and productive economic system.
To state that capitalism is effective for all would be entirely inaccurate. As Marxist Political Economists would argue a firm’s primary initiative remains to make profits, regardless of the potential risks and consequences and this has become evident during the 2008-banking crisis. Capitalism, alongside globalization, has also lead to the rise of the multinational companies and the resulting exploitation, which has become evident in countries worldwide.
Since the instituted euro
I don’t believe that there is a clear-cut divide of institutions or persons of power to take blame, but in fact, that many factors in which they are interconnected. When it comes to economics, it’s not just about cold hard concrete numbers, it’s also about power, political power most importantly, and which institutions and whomever harnesses such power in the
Social, cultural and political factors have negatively affected the country’s economic and business performance. The current financial crisis and debts of enormous proportions is the end result of this situation.
In summary, the EU and the IMF have evidently failed to provide a reasonable solution to end the Greek economic crisis. It is also quite clear that the funds, provided by the international community, were distributed among the interest groups and state officials. Thus, the government has been unsuccessful in re-paying public debts and improving the welfare and social situation of Greece and its’ citizens. This paper attempts to give some effective solutions to the current Greek situation, while using credible sources and analyses of possible policies, which can be adapted to decrease the Greek national debt and overall financial crisis. As a result, the resolutions this document offers include reasonable budget cuts, possibility of dropping the euro currency and officially declaring a default.