It's hard to find anything written or spoken about Greece that doesn't contain a great deal of hand wringing about the alleged austerity -- brutal fiscal austerity -- that the Greek government has been forced to endure at the hands of the so-called troika. This is Alice in Wonderland economics. It supports my 95 percent rule: Ninety-five percent of what you read about economics and finance is either wrong or irrelevant.

The following chart contains the facts courtesy of Eurostat. Social security spending as a percentage of GDP in Greece is clearly bloated relative to the average European Union country--even more so if you only consider the 16 countries that joined the EU after the Maastricht Treaty was signed in 1993. To bring the government in Athens into line with Europe, a serious diet would be necessary -- much more serious than anything prescribed by the troika.

By Steve H. Hanke

www.cato.org/people/hanke.html

Twitter: @Steve_Hanke

Steve H. Hanke is a Professor of Applied Economics and Co-Director of the Institute for Applied Economics, Global Health, and the Study of Business Enterprise at The Johns Hopkins University in Baltimore. Prof. Hanke is also a Senior Fellow at the Cato Institute in Washington, D.C.; a Distinguished Professor at the Universitas Pelita Harapan in Jakarta, Indonesia; a Senior Advisor at the Renmin University of China’s International Monetary Research Institute in Beijing; a Special Counselor to the Center for Financial Stability in New York; a member of the National Bank of Kuwait’s International Advisory Board (chaired by Sir John Major); a member of the Financial Advisory Council of the United Arab Emirates; and a contributing editor at Globe Asia Magazine.

Copyright © 2015 Steve H. Hanke - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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