Corruption and Cronyism in the Greek Crisis

A report from WSJ. Tragic Flaw: Graft Feeds Greek Crisis

Some comments from the readers are real interesting too.
"As an American living in Greece, this is the first article that really sheds a light on how bad it is here with bribery and corruption! When you try and fight back or refuse to "cheat" you are labeled a coward or an idiot for not doing everything like everyone else! You are so stupid, you pay taxes, etc..."

"...Modern Greece suffers from a completely corrupt political and governance system that has been inherited and preserved from the days of the Ottoman rule. Public servants at various positions and levels (e.g. ministers, mayors, tax collectors, planning officers, doctors ... you name it) create dubious and unnecessary needs and then demand to be paid in order to fulfil them. They act as the local chief, the pasha, to whom one has to go and ask for a favour in return for a hefty price, a cash payment (yes, please use an envelope). Rousfeti: word that I believe has Turkish origins. That behaviour coupled with a naive and desperate customer and an absent legal system makes up for a lethal mix in the long run.

At some point, a brave visionary with European ideas tried to change all that but he was killed by those local chiefs and that was the end of it all.

Now, all these peculiar behaviours have solidified in a local culture as the article points out so well. The absence of an efficient legal authority has allowed for a propensity towards corruption and the creation of a warped sense of right and wrong. Politicians are sitting at the top of this enjoying complete legal immunity, endorsed by the Constitution. Do you need anything more to destroy a country?"

Instead, it's corruption that's the trouble, but this article focuses on all the ways that Greece avoids taxes. Even that is not as significant since it is only 6% more tax avoidance than other Western countries, and the IMF has helped Greece to institute plans to stop some of it. Guess what the estimate for cutting tax avoidance is? 2%. That's it. But that's not how the deficit was built...."

"...Greece needs to stop taking on huge projects and charging the credit card for them. So many public works projects, and the Olympics, and military buying planes, subs and tanks. Debt is bloated because of high value purchases that have yielded no economic returns... "

I think the lesson is an independent effective legal system is as important as democracy for the health of a society.