Word: gdp
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Dates: during 2010-2019
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After a decade of overspending, Greece has fallen into a debt crisis. The country--which along with Portugal, Ireland, Italy and Spain is a member of the so-called PIIGS group of troubled European economies--is carrying a deficit close to 13% of GDP, more than four times the E.U. limit. Part of the blame for Greece's economic woes has been placed on padded public-sector wages and rampant tax evasion. Proposed austerity measures, which include a pay freeze for government employees, prompted thousands to go on strike. European leaders, who fear that Greece's troubles will trigger widespread...
...implemented a series of laws to strengthen its eco-defenses, many seeking to prevent dangerous wild things from reaching American soil (a more realistic goal than controlling them once they arrive). Worldwide, invasive species cause an estimated $1.5 trillion in damage every year, nearly 5% of global GDP. Lake Michigan could be next...
Greece suddenly found itself with a solid, reliable currency. Its government and businesses could borrow at lower interest rates than before. The country boomed, with real GDP growth topping 3.8% for eight straight years. (During the same 2000-07 run, U.S. GDP growth never hit 3.7%; Germany didn't make it past 3.2%.) It seemed as though Greece had landed a one-way ticket to economic good times...
...decision makers in Athens with responsibility for fiscal policy continued to blunder. The country kept running big deficits in the boom years. Then came the Great Recession. Last fall, a new government revealed that the 2009 budget deficit was much higher than previously disclosed--nearly 13% of GDP. Ever since, the world's financial markets have been going through another of their periodic losses of faith in Greece. Only this time, it isn't just Greece's problem...
What is the endgame here? Greece has big debts relative to the size of its $357 billion economy (about 120% of GDP). It no longer has the option of eating into those debts by inflating its currency. In fact, it has no power to use monetary policy to ease its pain, as the Federal Reserve has been doing in a big way in the U.S. The only options for Greece are to 1) scrimp and save to convince creditors that it can keep paying them off, 2) convince its fellow euro-zone countries--or maybe the International Monetary Fund...