Greece's economy is currently very weak and is threatened by a possible bankruptcy due to high amounts of debt.
Because Greece is within the Eurozone, Europe has come together in effort to save Greece and, in essence, to save the Euro.
In order to prevent a domino effect throughout the Eurozone, EU must take immediate steps to save Greece.
A collapse of Athens could possibly mean a second global financial and economic meltdown.
This article outlines my research into Greece's debt crisis, its causes, and two possible solutions to the problem.
Unstructured Government Problem Through my research, I found that Greece has allowed corruption and tax evasion to thrive in the country.
This corruption has gradually taken over the country and the government seems to no longer have control of its people and taxes.
According to calculations of the European Union, Greece loses approximately 30 percent of its income taxes due to tax evaders.
Through years of such corruption, Greece has lost control of its money and has allowed the debt to pile up.
Now that Greece is in trouble -- and within the Eurozone -- Europe has to pay to keep Athens alive.
However, the real corruption began before Greece was ever allowed to be part of the Eurozone.
Greece should have never been allowed to enter the Eurozone.
In 2001, Greece claims to have dramatically cut its inflation and interest rates.
Greece also claimed to have lowered its deficit below 3 percent which meets the requirements to join the Eurozone.
However, after taking a closer look into Greece's budget figures, it becomes evident that the country has not actually met the conditions to join the Eurozone.
The Greek government admits that its deficit has never been below 3 percent since 1999.
Bail-Out Problem In an effort to save Greece and the Euro, international authorities have supplied immense support.
In May 2010, a 110-billion Euro bailout was granted to Greece.
However, the funds were not enough.
Recently, the European Union has suggested a second bailout plan for 120 billion Euros in an effort to save Greece.
Although the second bailout plan may help Greece for the time being, it is a temporary solution that will only delay the problem.
The European Union reckons that by 2014 Greece will be unable to fund itself once again.
This concludes that the current funds of 110 billion Euros will not be enough.
Due to the tremendous amounts of funds sent to Greece in the past two years, taxpayers in Europe are not unaffected by this crisis.
Calculations have shown that each household in the Eurozone underwrites 535 Euros in Greek debt however, by 2014, following the second bailout, the numbers will increase to 1,450 Euro per household.
Solutions A direct answer to this diverse problem is not possible; however, one solution could consist of keeping Greece in the Eurozone and regulating the government more closely to hinder corruption in the country.
However, it would also cost Europe millions to run the country in a stricter manner.
This solution would still include the help packages, and would also require the help from surrounding countries to keep a closer watch on the tax evaders to limit their corruption in the system.
This solution contains risks as it is not guaranteed to work, and the possibility of a bankruptcy still remains.
The second and more effective solution would be for Greece to exit the Eurozone.
Greece has considered this solution, but many experts have warned of the many consequences.
Experts warned that if Greece dropped the Euro, the new Greek domestic currency will lose as much as 50 percent of its value against the Euro.
If Greece were to exit the Eurozone, it could lead to the country's bankruptcy.
However, if Greece stays within the Eurozone, there is still no guarantee that a bankruptcy can be avoided.
Therefore, if Greece exits the Eurozone, the Euro will not be jeopardized; but if Greece stays within the Eurozone, its bankruptcy may cause a total financial crash within the Eurozone and possibly precipitate a worldwide financial crisis.
Summary Due to Greece's unstructured government and the associated corruption and tax evasion, debt has risen to unimaginable levels.
Pressure is now on Europe to save Greece and the highly valued Euro currency.
In order to prevent a financial crisis in Europe, Greece's government must either be closely regulated or Greece must exit from the Eurozone.
Greece's exit from the Eurozone would lead to the relief of the many European countries within the zone.
All in all, when considering that Greece used corrupt methods to enter into the Eurozone, financially stable countries within Europe should not be responsible for Greece's financial debt.
Therefore, I believe it would be in the best interest of the European financial market if Greece were to exit the Eurozone.
Because Greece is within the Eurozone, Europe has come together in effort to save Greece and, in essence, to save the Euro.
In order to prevent a domino effect throughout the Eurozone, EU must take immediate steps to save Greece.
A collapse of Athens could possibly mean a second global financial and economic meltdown.
This article outlines my research into Greece's debt crisis, its causes, and two possible solutions to the problem.
Unstructured Government Problem Through my research, I found that Greece has allowed corruption and tax evasion to thrive in the country.
This corruption has gradually taken over the country and the government seems to no longer have control of its people and taxes.
According to calculations of the European Union, Greece loses approximately 30 percent of its income taxes due to tax evaders.
Through years of such corruption, Greece has lost control of its money and has allowed the debt to pile up.
Now that Greece is in trouble -- and within the Eurozone -- Europe has to pay to keep Athens alive.
However, the real corruption began before Greece was ever allowed to be part of the Eurozone.
Greece should have never been allowed to enter the Eurozone.
In 2001, Greece claims to have dramatically cut its inflation and interest rates.
Greece also claimed to have lowered its deficit below 3 percent which meets the requirements to join the Eurozone.
However, after taking a closer look into Greece's budget figures, it becomes evident that the country has not actually met the conditions to join the Eurozone.
The Greek government admits that its deficit has never been below 3 percent since 1999.
Bail-Out Problem In an effort to save Greece and the Euro, international authorities have supplied immense support.
In May 2010, a 110-billion Euro bailout was granted to Greece.
However, the funds were not enough.
Recently, the European Union has suggested a second bailout plan for 120 billion Euros in an effort to save Greece.
Although the second bailout plan may help Greece for the time being, it is a temporary solution that will only delay the problem.
The European Union reckons that by 2014 Greece will be unable to fund itself once again.
This concludes that the current funds of 110 billion Euros will not be enough.
Due to the tremendous amounts of funds sent to Greece in the past two years, taxpayers in Europe are not unaffected by this crisis.
Calculations have shown that each household in the Eurozone underwrites 535 Euros in Greek debt however, by 2014, following the second bailout, the numbers will increase to 1,450 Euro per household.
Solutions A direct answer to this diverse problem is not possible; however, one solution could consist of keeping Greece in the Eurozone and regulating the government more closely to hinder corruption in the country.
However, it would also cost Europe millions to run the country in a stricter manner.
This solution would still include the help packages, and would also require the help from surrounding countries to keep a closer watch on the tax evaders to limit their corruption in the system.
This solution contains risks as it is not guaranteed to work, and the possibility of a bankruptcy still remains.
The second and more effective solution would be for Greece to exit the Eurozone.
Greece has considered this solution, but many experts have warned of the many consequences.
Experts warned that if Greece dropped the Euro, the new Greek domestic currency will lose as much as 50 percent of its value against the Euro.
If Greece were to exit the Eurozone, it could lead to the country's bankruptcy.
However, if Greece stays within the Eurozone, there is still no guarantee that a bankruptcy can be avoided.
Therefore, if Greece exits the Eurozone, the Euro will not be jeopardized; but if Greece stays within the Eurozone, its bankruptcy may cause a total financial crash within the Eurozone and possibly precipitate a worldwide financial crisis.
Summary Due to Greece's unstructured government and the associated corruption and tax evasion, debt has risen to unimaginable levels.
Pressure is now on Europe to save Greece and the highly valued Euro currency.
In order to prevent a financial crisis in Europe, Greece's government must either be closely regulated or Greece must exit from the Eurozone.
Greece's exit from the Eurozone would lead to the relief of the many European countries within the zone.
All in all, when considering that Greece used corrupt methods to enter into the Eurozone, financially stable countries within Europe should not be responsible for Greece's financial debt.
Therefore, I believe it would be in the best interest of the European financial market if Greece were to exit the Eurozone.
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