To help Greece return to growth, the euro zone and the IMF are discussing giving Athens an extra two years to reach a primary surplus of 4.5 percent of GDP,

That\’s gotta hurt, being forced to run a primary surplus of that size.


9 thoughts on “Ouch!”

  1. In the 1920s the UK ran primary surpluses of 7% of GDP. The IMF was not exactly complimentary about this policy in its recent report. Admittedly 4.5% is not as much, but it seems odd that IMF are in favour of the same policy in Greece that they criticised in the UK.

  2. If we had been running a 4.5% surplus when the banking crisis hit us, what would have been the result?

  3. John,

    “Primary surplus” is the excess of government income over spending before debt interest costs.

  4. So Much For Subtlety

    With the Greeks, the safe bet is that only half the plan will be implemented. And in this case, smart money ought to be on the “two years” half, not on the “primary surplus” half. They are just delaying the inevitable once more. Greece has no more chance of being in primary surplus by then than I have of being the next James Bond.

  5. My god, paying back your debts rather than consuming your income?

    Isn’t that just what one has to do when one has run up debts? Stop partying and start working? The rest of us have to do this, so Greece should likewise knuckle down and work it off.

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