The Guardian, a U.K. based news organization, headlined its reporting of today’s anti-austerity, pro-Syriza rally in Greece with the quote:
It’s a question of dignity.
Greece is on the verge of defaulting on a debt payment to the International Monetary Fund that is due today. This payment’s deadline isn’t coming as a surprise to anyone, and Greece’s politicians and bureaucrats have known for years that the country’s governmental finances are so catastrophically out of whack that there’s a very real chance – some say an inevitability – that Greece will be forced out of the Euro zone.
How did things get to this point? How did the Greek government fail its citizens so badly that things got to this state? Many adages and proverbs come to mind, including the French philosopher Joseph de Maistre’s “Every nation gets the government it deserves” and H. L. Mencken’s “Democracy is the theory that the common people know what they want, and deserve to get it good and hard.”
There are many guesses as to what will happen should default occur and Greece return to its own currency, but none of them suggest anything but hardship for the Greek people in the near and medium term. Yet, rather than demand that politicians work mightily to avoid this default, some Greeks choose instead to speak of dignity.
Self-delusion and abdication of responsibility are common phenomena in voters, but whence dignity?
Greece has buried herself under a mountain of debt, mainly by living beyond her means. Public education through the tertiary level, socialized medicine, a complex and interwoven system of retirement pensions, nearly a quarter of the workforce working in the public sector, 40% of the nation’s GDP generated out of the public sector – all financed and maintained by borrowing euros. The bad state of the economy, itself a product of government bloat and a stultifying regulatory environment, compounds the problems caused by profligacy. In short, Greece has done this to herself. Yet, rather than admitting this, protesting Greeks speak of dignity.
I recall, a while back, an Internet discussion about food stamps and government efforts to restrict what can be purchased with them. It would seem rational that, if someone’s receiving largesse in order to provide the first element of the food-clothing-shelter trio that are the basics of subsistence, the bestower of that largesse might attach some strings, if only to maximize the efficiency with which a scarce resource is used. And, despite many incendiary (and false) stories that fly all over the Internet, the SNAP program does restrict what can be purchased with food stamps. In the discussion, however, one writer posited that restricting what a recipient could do with largesse was an affront to his or her dignity, and that people were entitled to live their lives as they wished even when supported by the State or by charity.
Roll back the time machine a bit, to the 1970s. Bad economic times, especially for the poor. Many ended up relying on welfare to get by, but taking welfare was a stigma, and many who were forced onto it by hard times and bad luck felt as if they had failed themselves and their families. I recall an episode of the TV series Good Times that illustrated this attitude when the father came home one day and told his wife that they were going to have to go on welfare. He looked like a broken man.
If that attitude and outlook exists today, it has been buried by social media that present public support as something people deserve, and that they should not only accept but pursue as part of their rights as citizens and residents. A sense of entitlement to other people’s money has replaced the obligation to rely first on one’s self and the satisfaction of being able to do so. The inherent and obvious dignity associated with the latter is incompatible with a presumption that dignity exists unmarred when one lives off the largesse of others.
Debt, of course, is not largesse. Debt is a useful and important economic tool and engine for wealth creation. Debt, however, comes with a obligation – that it be repaid. Repayment of debt not only rewards the lender for the trust he placed in the borrower, but it builds the reputation of the borrower as well. Consider in the Game of Thrones books and television series, the oft repeated declaration a Lannister always pays his debts. It is a declaration of reputation, and is used time and again as a strong currency with which to establish trust and pursue benefit. More broadly, countless cultural references (and scripture) include the observation that a good man pays his debts, an observation that should ring true for most of us.
Contrast this with the person who defaults on a debt. In our society, and in most that function reasonably well, it will be less likely that such a person will be trusted again should he seek to borrow. His credit score will decrease, his access to credit will be curtailed, and if the debt was to a friend or relative, his relationship with that lender will be damaged on a personal level. That’s hardly the stuff of dignity.
What of the person who borrows, knowing full well he has no plan in mind that will enable repayment? Is there a shred of dignity in such an act? Is it anything other than a planned theft? It takes a special sort of hubris to even declare that one has any dignity under such circumstances, let alone demand that creditors respect that dignity. Yet that’s what seems to be the case in Greece, as plans for repayment of the mountain of debt that Greece has accumulated, debt that has reached 175% of her GDP.
There is dignity to be had when in debt. However, that dignity is achieved when the debt is repaid, not by demanding that it be forgiven.
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