Having just read the first releases on the “economic
austerity plan” imposed by the EU on Greece, there was one reformation that
caught my eye. The Greek government is required to raise the minimum wage rate
significantly, while at the same time drastically reducing government welfare
programs. The premise being that it will incentivize people to work and
significantly reduce the cost of the welfare programs AND reduce dependency on
the government. There will, of course, still be welfare for the most vulnerable
in society, but this would mean the end of generational dependency on the Greek
government.
As more details are released on this plan, I would assume
that the government would offer incentives to businesses to expand with part of
the savings from the reduction in welfare spending. The balance of the savings
would go toward PAYING DOWN DEBT. This shift from government dependency to the
private sector is a model that makes sense in my opinion, as the private sector
is ALWAYS more productive with capital than government, no matter where in the
world one lives. Maybe one of our Presidential candidates will go out on a limb
and suggest something with economic teeth rather than vague, toothless slogans.
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