Is That Really Helpful?

When we suddenly realize—thanks to a happy (or should I say unhappy) context—that we have one child older than Angela Merkel of Germany (11-17-1954), two older than Barack H. Obama (8-4-1961), and a third child who is just two years younger than the President, why then one sits down for a moment to think.

Such a moment came recently in this household. And it recurred again today when both the New York Times and the Wall Street Journal featured front page photographs of Angela Merkel enthusing with raised arms over Germany’s victory over Greece in the quarter finals of the World Cup held in—of all places—Gdansk in Poland.

Here is a conjunction of venues, individuals, pop culture, and media that signals to the fading adults in this space that things are really out of joint—but we feel too feeble, actually, to intervene. Our time of routinely intervening passed about 30 years ago.

Is it all that helpful for world leaders to be seen exulting at an event that they are surely old enough to know will be exploited massively by the hyenas of the media? Is it responsible for the New York Times to splash the picture on its front page—or is that just a reflexive hatred for all things German combined with a revulsion for austerity? Does it make fiscal sense for the Wall Street Journal to inflame the markets with the same image? Is that responsible journalism? The context here, of course, is soccer, surely the biggest modern circus sport and almost automatically linked to the word “hooliganism.” Should adults, be they elected officials or the guardians of the “people’s right to know,” engage in such tactics?

Is there a subtle sophistication involved here? Is Merkel signaling to German voters? Do the papers have an agenda? Or is immature behavior the very meat they want to serve a public even more infantilized than its masters?

Thank God the sun is out. Next to a brick that holds up our sagging miniature picnic table we bought when our grandchildren were small, tiny ants are busy raising large mounds of very fine dirt. I think I’ll go out there to have a conversation with them. There are still real adults around, however small.

Greek Corrective

To read the papers, it would appear that just about everybody in Greece is working for the public sector. I found some numbers for Greek public sector employment on the Philip Atticus’ blog (here) for 2011, citing ELSTAT, the country’s National Statistics Organisation. According to these numbers, public sector employment in Greece was 18 percent of the total workforce—which compares to 16.6 percent for the United States in 2011, taking December 2011 as the benchmark. Not all that different.

I made efforts to look at other sources of data as well. One is the Organization for Economic Cooperation and Development. OECD presents data for the period 1993 through 2009, identifying one category as “Public Administration and Defense”; that category, much like the equivalent U.S. data from the Bureau of Labor Statistics, excludes the armed forces. The numbers I found (link, p. 158) are significantly lower than those cited by Atticus: In 1993 public sector employment was 7.2 percent of the total labor force, in 2009 8.6 percent.

In any case, the Greek economy looks quite similar to others in the developed sector. Agriculture represents 12 percent of total employment, which is fairly high (and compares to our own at 1.6%), industry at 20 percent (30.1% in our case), and services at 68 percent (68.3% in the United States).

I tried to find confirming data on ELSTAT myself, but the site is all in Greek—and Google’s translation service failed me when I had penetrated down to the really substantive statistical presentations.  

Greek Debt

The Greek sovereign debt is in the news today. I got to wondering just how big it is. Meaningful numbers are difficult to find, but I succeeded after a while by consulting the German Spiegel (link). It carries a listing of the debt subdivided into categories—thus the institutions that actually hold it. I show this in a tabulation. Only money actually dispersed, thus actually paid out, to Greece is included. Much more has been promised. My conversion of Euros to dollars uses a rate of $1.2671 per €1, a quite low rate reached this morning.

Greek Debt
	€ bill.	$ bill.	%
European States	41	52	18.0
European Central Bank	50	63	21.9
IMF	18	23	7.9
Greek banks	50	63	21.9
Foreign banks	39	49	17.1
Foreign funds	30	38	13.2
Total	228	289	100.0

Much of the fretting in the media circles around the smallest number here, the holdings by foreign funds (13.2% of the total); some of these are hedge funds. The reason for the barely suppressed hysteria is that hedge funds insure their holdings using credit default swaps; such instruments still exist and may still be sold as derivatives, hence the liabilities are spread God-only-knows where. The invisible consequences may materialize, who knows, even in this humble basement where I write, and I may succumb to dark evil things that will suddenly attack from thin air.

To get some feel for these numbers, I looked up the GDP of the European Union; granted, that is greater than the Euro Zone. That number was $16,282 billion in 2010. The Greek debt, therefore, represents 1.8 percent of the gross domestic product of all Europe. In 2010 Greek GDP stood at $305 billion. Germany’s was $3,315 billion—and the Greek debt, expressed as a percent of German GDP, was 8.7 percent.

The debts are high but are they monstrously high? Not at all. The dangers lie in our virtually non-existent powers of collective self-control—and our much vaunted markets that can spread panic in the flash of an eye.