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Business Daily: Greece's dilemma

27/06/2011

Greece's dilemma

BBC World Service - Business Daily, Greece's dilemma

Why so many Greeks oppose the austerity plans - even though so much is resting on them

This week the Greek parliament will vote on the latest austerity package. Manuela Saragosa reports from Athens on why with so much at stake do so many Greeks continue to oppose the package?

Every week seems to bring a new deadline in the Greek debt drama, yet leave the crisis unresolved.  This week is no different. The Greek Parliament will be debating a programme of tax increases and spending cuts worth 28bn euros over the next five years.  

The EU and the IMF have threatened that unless these austerity measures are passed Greece will not receive the latest tranche of bail-out cash. Without that, Greece will default on its debts which could, in turn, trigger, many believe, a crisis that would see a wave of sovereign defaults and prompt a global financial crisis.  

With so much at stake you might imagine that passing the austerity measures would be a shoo-in. Unfortunately not: there is huge public opposition to the cut backs.  

A key part of the austerity package involves privatising many of Greece's publicly owned companies. But, as Manuela Saragosa reports from Athens, selling off state businesses challenges a deep rooted culture of entitlement and state dependency that has developed in Greece.

It isn't only in Greece where the state's protection of workers is hot political issue.  

South Korea, Colombia and Panama could be drawn into a trade feud with America over what seems like an arcane aid programme for American workers.  

President Obama wants to renew expanded benefits for workers who lose their jobs due to competition from imports.   In retaliation Congress is threatening to block several free trade agreements.  

All this has prompted an unusual cross-party alliance: two former presidential economic advisors, one Republican, one Democrat, have come together to argue that there is a way out of the impasse.  

Professor Robert Lawrence is Professor of International Trade at Harvard's Kennedy School. He was a Clinton adviser and has joined forces with Matthew Slaughter a well-known Bush aide.  

Justin Rowlatt asks Professor Lawrence why he is arguing to liberalise trade when so many Americans appear to believe that America's free trade policies have caused much of the country's historically high unemployment.

And finally we have a question that seems to come up in every job interview - 'what are your strengths and weaknesses?' 

The advice tends to be that you shouldn't admit to any negative character traits - just the ones that are really positives in disguise. So the ideal answer goes something like, "if I have a weakness it is that I am too hard-working."  

It is advice that the people at the top of the business world seem to have taken to heart, according to our regular commentator, Lucy Kellaway of the Financial Times.

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