Greece keeps teaching us valuable lessons

News. March 3 (Bloomberg) -- Greek Prime Minister George Papandreou announced an additional 4.8 billion euros ($6.6 billion) of deficit cuts as he tries to convince European allies and investors that he can tame the region’s biggest budget gap.

My point.The cuts include deep salary reductions for public employees, increased taxes across the board, and reduction of benefits.

This is an important lesson for all countries giving disproportionate financial advantage to special groups without considering the other side of the coin. Who is going to produce the wealth needed to finance the generosity?

It should be a lesson for all governments. Including ours. Printing money and giving it away to politically favored groups is not the way to run a country. Favoritism to unions, housing, and now extending benefits to the unemployed are all political moves that eventually damage the country.

In my humble opinion, a country should concentrate in creating wealth and contain public costs. Then, redistribute the wealth. Greece continues to teach us valuable lessons. But we are not learning, unfortunately.

Government leadership is about understanding the needs of the country and what it can afford. Set the rules of the games and be a good empire. Not an owner of the resources.

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
Ranked Top Market Timer in 2009 and 2010 by Timer Digest

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