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Greek fire and the crowds in Athens.

Leading article [Wall Street Journal – The fires in Athens are the result of the combustible mix of a desiccated welfare state and the burning embers of Keynes’s cigarette. Don’t expect those fires to be put out by this latest round of austerity. In theory, Athens has agreed to carve €3.3 billion out of this year’s budget (including €300 million out of pensions), slash the minimum wage by 22%, and eliminate 150,000 government jobs by 2015.

These are necessary measures for a government sliding toward a debt-to-GDP ratio of 160%. But they do nothing to address the growth side of Greece’s problem. They will also create an intolerable political problem for Greece’s government as state workers are laid off into a shrinking economy. Expect a fresh exodus of Greek labor, along with increasingly powerless (and short-lived) Greek governments.

With Sunday’s vote, Greece has dodged a disorderly default, at least for the time being, and Greece’s private creditors can consider themselves lucky for taking only a 50% haircut under the latest proposed restructuring deal, when they might have had their heads shaved. But the crisis will not end until Greeks understand that they must live off what they produce, and adopt the policies that enable them to produce more. The larger question is whether the rest of Europe and America will learn from Greece’s chaos before they experience the same fate.

Continued at The Wall Street Journal |

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A tragedy in tweets.

[Mashable] – Greek parliament approved a controversial austerity deal Sunday so the indebted country can get a bailout from the European Union. After the vote, angry Greeks began rioting and hurling fire bombs and stones at police and storefronts.

By Monday morning, the violence had subsided. The EU told Greece that the vote was welcome, but more action was still needed to avoid default and “disastrous consequences.”

Greeks used Twitter and YouTube to share scenes of the turmoil with the rest of the world. Mashable has collected tweets, photos and videos that best represent the riots and the day-after reckoning of the damage.

Continued at Mashable | More Chronicle & Notices.

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