Greece - €86 Billion Euro Later

By Michelle Seiler-Tucker

After 17 hours of negotiation, Greece accepted a bailout plan to the tune of €86 billion euro. The settlement set forth by Greece's three creditors, "the troika," is harsh, but it needs to be. European Commission, IMF, and ECB officials are wary of Greece's commitment to repaying debt, and structured a deal which left very little room for Greece to wiggle out. If Greece avoids its required payments, or deviates from the settlement, near-automatic spending cuts will be activated. Greek parliament votes on the settlement this week - the three creditor institutions will then formalize and institute the plans. Here are the key points to the settlement package: Greece must simplify its tax code and expand its VAT. To mitigate the negative effects of widely increasing taxes, €35 billion euro from the EU will become available for economic stimulus. [more...]