The mainstream media and Greek politicians are constantly pumping out articles which say that Greece is uncompetitive, how Greece should return to the Drachma, how the Drachma needs to be devalued to make Greece competitive and so on and so forth.
Thankfully not everyone agrees, including me and here is why.
Excuse me while I cut through the nonsense,bull**it and propaganda and look at the fundamentals.
Technology
Greece has access to the same technology as Germany. Whether it be software, manufacturing equipment, high-speed internet connections, machinery and so on. There is no technology that Germany has access to that Greece does not. In short, technology is not a reason for Greeks to be paid less than Germans.
Education
The standard of education in Greece is equal to that of any country in Europe if not better. Greeks have access to universities throughout Europe and most Greeks speak English or German as a second language and many speak 3 languages or more. So again, Greeks have the same educational opportunities as Germans so education is not an issue. In short, education is not a reason for Greeks to be paid less than Germans.
Resources
The population density of Greece is far lower than Germany. In Germany there are 229 people per square km, in Greece there are only 86 people per square km. Greeks have almost 3 times as much land person as Germans, so natural resources are not a reason for Greeks to be paid less than Germans.
You may say Greece is much more mountainous than Germany, okay, I take your point but let’s look at coastline.
Greece has around 13,000km of coastline, whereas Germany has only 2389km. If you add to that the much more central location of Greece and how much easier it is to access the Greek shoreline from around the world, Greece not only has more coastline but it is arguably more valuable than German coastline.
And that is not taking into consideration the climate where the coastline is located or the type of sea Greece has access to. I have never met anyone who went on a beach holiday to Germany, I have, on the other hand met countless people who have been to Greece for a beach holiday and I have never met anyone who has said they would not like to go to Greece on holiday.
Whats my point?
Even though Greece might be more mountainous than Germany and therefore arguably have less productive farmland per person, the value of the Greek coastline per km is many more time valuable than coastline in Germany, not to mention the fact that Greece also has around 6 times more if it.
Germany, assuming 60 million population = 0.00003 km per person
Greece, assuming 11 million population = 0.001 km per person
Greeks have around 30 time more coastline per person than Germany.
And this is ignoring the area of the territorial waters of the countries.
Greece has around 130,000 square km, Germany has around 8,000 square km.
Greece has approximately 80 times more territorial waters than Germany per person.
So not only is the coastline and sea in Greece much more valuable than German coastline and sea, Greece also has massively more of it per person.
In short, you can argue than Greece has massively more natural resources than Germany. So lack of resources is not a reason for Greeks to be paid less than Germans.
In conclusion.
Money is labour and resources in an easy to trade form. Greek labour is, or can be, just as skilled as German labour and each Greek has many times the natural resources of his German neighbour. So there is no reason for Greeks to be paid less than Germans on the basis of education or resources.
Technology is also equal between the 2 countries so the labour and land can be exploited just as efficiently and effectively in Greece as it can be in Germany.
There is no fundamental reason why Greeks should not be paid the same as Germans. Or to put it more accurately, there is no reason why a unit of Greek labour should be worth less than a unit of German labour.
Actually, when I started writing this article, I was hoping to be able to show that there is no reason why the wages in the 2 countries should not be equal. But as I have researched the links above, I now believe there is no reason why the wages in Greece should not be greater than those in Germany.
Given that education and technology are equal between Germany and Greece and that Greece has many times the resources of Germany per capita, it has taken an immensely corrupt, easily influenced by foreigners, incompetent, ignorant, selfish, misguided, immoral, cruel, short-sighted and disloyal political class to bring Greece to the point where it is dependant on handouts from an arguably inferior country (on the basis that technology and eduction is equal and Greece has much greater natural resources).
Greeks need to start asking questions as to how and why successive Greek governments have created such an environment where the Greek state is dependent on foreigners when arguably, if anything, it should be the other way around.
Only when Greeks start ignoring the advice of their political ruling class and start to understand the root and fundamental causes of the current economic problems can there be any hope of Greece establishing itself as a power-house in Europe. (Please see my other articles for my opinions on this matter).
I believe the solution to Greece’s problems is extremely easy. In fact I believe it takes a huge effort by foreign entities to make Greece as inefficient as it is. The Greek government simply has to do less, get out of people’s lives and let people be free to do what they want when they want as long as they do not restrict the freedom of others.
I believe it is infinitely more difficult to create the current economic problems in Greece than it is to create a prosperous economy. People just need to be free from government and that is not only a better way, it is also cheaper into the bargain.
Stupidity on its own is not enough to destroy Greece’s inherent competitive advantages over northern European countries. It takes proactive and deliberate measures, Greek need to identify how this is happening and what they can do to make their political class less easy to manipulate.
That is my opinion, I would love to hear yours.
I agree on your evidence they could potentially be the same. They seem to have bungled the last decade after joining the euro. They could have encouraged european companies to locate in Greece but instead they borrowed money and spent it on imports.
It’s more than just coastlines. Greece has large unexploited oil, gas, gold and even uranium reserves. Now the government is shuting down ΙΓΜΕ(the Institute for Geological and Mineral Research) and ΕΛΚΕΘΕ(the Greek Centre for Marine Research) so there will be no scientists protesting the government’s plan to sell out those resources.