What Democracies Can Learn From Greece's Failed Populist Experiment

While the crisis in Greece no longer captures international headlines as it once did, the country’s troubles never went away. Greece remains the only Eurozone country still subject to a joint Eurozone-International Monetary Fund fiscal adjustment and structural reform progra m. In the long-running saga’s latest episode, the recent completion of a crucial compliance review paves the way for the release of $7.6 billion in bailout funds to Greece from its creditors in exchange for further budget cuts and tax increases.

Faced with a massive budget shortfall caused by a combination of overspending and undertaxing at a time of swelling global financial risk, Greece found itself unable to refinance its huge debt. As a member of the Eurozone and a debtor to several major European banks, it was able to elude outright default, securing a bailout from its European partners who, with the assistance of the IMF, demanded an onerous fiscal adjustment. With or without a bailout, an adjustment of such magnitude was both necessary and painful. But the hastily designed, poorly