Points of convergence

Posted by Antonis D. Papagiannidis 17/09/2018 0 Comment(s) Economia Blog,

The fighting – if not outright aggressive – mood that traditionally permeates Greek politics as expressed throughout the (equally traditional) Thessaloniki Fair event has been present this year, too. As expected.


Still, were one to delve deeper into the positions taken by the major contenders for power – Prime Minister Alexis Tsipras and Opposition Chief Kyriakos Mitsotakis - one would easily find points of convergence. Provided, of course, that one does not say so in public! Enmities have to be nurtured carefully over things political in Greece -especially so when an electoral year looms.


A major field of economic policy convergence has to do with the reversal of the tax-tax-tax/cut-cut-cut policies implemented under three successful Adjustment Programmes devised (and imposed, through the use of strong-arm tactics) by Greece’s creditors. Both Tsipras and Mitsotakis have aired plans to cut back in business taxation; to alleviate the tax burden of families; to slash property taxes; to back-pedal Social Security contributions. True enough, the exact extent and the phasing-in of such cuts differs while important discrepancies in the way the cuts would come into play should be noted. For instance Tsipras would cut property taxes in a (steeply) progressive way, while Mitsotakis would transfer such taxation powers to local authorities.


Also, the stance adopted over Social Security would entail some sort of negotiation with creditors (to be conducted under a different angle if undertaken by the current Government or by a future one), while Mitsotakis would launch an overall overhaul of Social Security based on three-pillar system so as to progressively switch from a pay-as-you-go to a fully-funded system (with a third pillar based on tax-deductible private insurance schemes).


On the spending side of the equation, too, differences do exist in priorities – but a common feeling can be easily traced of the need to alleviate the pressure experienced by those less-favoured, who have mainly borne the brunt of close-to-ten-years austerity.


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