ATHENS — Rarely considered is the potential for poverty within the developed world, but the possibility exists for even a well-developed economy to suffer extreme recessions and ultimately result in widespread poverty. Following the 2008 recession, most economies worldwide suffered on some level. Among the most devastated countries has been Greece.
Though it has been a long six years, the recession lingers throughout Greece as citizens struggle to maintain a semblance of prosperity they once enjoyed on a continent that boasts among the highest standards of living in the world. Many would say every facet of Greek life has been diminished or destroyed following the recession.
A common response to the ongoing crisis has been austerity practices: a method of economic recovery that emphasizes large-scale budget cuts and increased taxes. Austerity encourages a reduction in social welfare and an extremely liberalized economy in order to lower budget deficits and promote investments. What is not sufficiently considered, however, is the reliance placed on welfare and the need for a strong social safety net in order to promote an equally strong working class.
Austerity measures in Greece have led to crippling unemployment, massive social backlash, political uprisings, xenophobia, and an increase in suicide rates and rising panic among the citizenry. The manner in which Greece continues to suffer under austerity indicates the possible future of many recession-stricken countries, including Spain, Ireland, Italy and Portugal. The future economic security for many suffering nations is dependent on its citizens understanding the harsh reality of austerity and how it greatly deteriorates political and fiscal sovereignty while simultaneously weakening the working class.
Improving poverty, whether in Greece or around the world, is dependent on promoting a strong, educated and secure working class that is able to efficiently support itself and contribute to the local and national economy. Austerity as the response to the budget crisis has shown to facilitate a weaker working class, thereby diminishing the purchasing power of citizens as well as greatly reducing both labor forces and available markets. In 2011, over three million people were at risk of poverty and homelessness, with suicide rates rising by a third since 2010. As of 2013, Greek unemployment stood at 27 percent to 70 percent among adults aged 18 to 27 years old.
A diminished working class is not the only thing that suffers under austerity. Once ranked 14th in the world for healthcare, Greek hospitals now lack basic amenities like needles, gloves, IV bags and a sufficient staff. Hospital admissions have increased by 25 percent, though $9 billion has been cut in healthcare spending.
A major catalyst for the crisis in Greece has been social and political corruption. Ranked as the most corrupt nation in Europe, Greece has seen its fair share of money simply disappearing. While nationalized programs continue to be slashed for the sake of savings, those savings have yet to be adequately distributed to those most in need.
Though Greece faces many challenges in promoting a fair and equitable system, nationalized programs and government assistance are critical to its citizens in the meantime. Alternatives to austerity have been voiced by one Greece’s secondary party, Syriza, led by Alexis Tsipras, has called for stopping austerity, renegotiating loan agreements, halting wage and pension cuts and implementing a type of Marshall Plan-like investment drive. The fight against poverty is best performed when spearheaded by a strong labor force that is self-sufficient, politically active, and monetarily secure. Without security, people are less likely to invest and without investments, money is not exchanged. Promoting economic growth is a fundamental aspect of poverty reduction and growth.