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Tourists were stranded without rides to the airport and traffic jams stretched for miles in Athens, Greece yesterday while a 24 hour public transportation strike was held in protest of further austerity measures. Work stoppages were carried out by a range of professionals, including tax officials, and riot police used tear gas to disperse a crowd of a 1000 protestors outside the Parliament. Once again, Greece is said to be on the brink of financial collapse. After receiving a bailout of over 100 billion Euros from the European Union a little over a year ago, a second bailout is now in the works. To receive loan installments, or tranches, the Greek government has been continually required to cut public spending and raise taxes, leading to a series of mass demonstrations and strikes that peaked in June. On Tuesday a new property tax was imposed, voted through Parliament by 154 out of 300 members. Also approved is a 20 percent cut to the public workforce, a reduction in wages, and a 4 percent decrease in pensions on top of the 10 percent decrease already agreed to. In an interview on Greek TV Deputy Prime Minister Theodoros Pangalos said, “I think the tax-paying limits of Greek society have been exhausted.” However he then voiced support for spending cuts. German Chancellor Angela Merkel made headlines on Tuesday for appearing open to a renegotiation of the terms of a second bailout, pending an audit of Greece’s current finances by what Greeks call the Troika, which is Russian for ‘three of a kind.’ The Troika includes the International Monetary Fund, European Central Bank, and the European Commission. The group recently suspended its assessment over concerns of an immediate default, forcing Tuesday’s new property tax bill. There is support among some Eurozone members for banks to take a bigger hit and alleviate pressure on Greece. The planned second bailout would require private investors to forgive about 20 percent of Greek debt. However there is agreement among economists and analysts that only a debt reduction of at least 50% will put the nation on the track to solvency. A less popular option pushed by observers who view the current deal as cruel and untenable for the Greek people, is for Greece to default on its loans, and drop the Euro altogether. Proponents of this argument, like Prof. Stergios Skaperdas, say this could give Greece leverage in loan negotiations, and much needed sovereignty from an economically oppressive system.

GUEST: Stergios Skaperdas, a Professor of Economics at the University of California, Irvine and author of an article on the topic published in Monday’s Guardian, Greece Needs to Default on Its Debt and Exit the Eurozone

Read Skaperdas’ article here: http://www.commondreams.org/view/2011/09/26-4