Grecian Earn

By Russell Ethridge

I’ve probably been complicit in tax fraud. Certainly not illegally; I’ve always paid Uncle Sam every dollar he says he’s owed. Where I suspect I went astray was during a recent trip to Greece, a country of remarkable beauty and history, warm people, and a government few trust and not enough pay for.

My crime was facilitating tax avoidance by paying in cash instead of a credit card to get a discount exceeding the modest fee VISA or American Express charges the merchant. Major hotels, the worldwide car rental companies, and high end retailers are not involved, at least that I could tell, but everyone else I encountered, the little tavernas and gift shops in small towns and every cabbie, offered at least a five percent markdown or more for cash. Nothing was rung on a register. Instead, a roll of Euros was whipped out, and the cash transaction was handled with no mechanical or digital finger prints.

Such transactions are invisible and impossible to tax without voluntary compliance. Greece, like much of southern Europe, is struggling economically. Although socialist Portugal (to the surprise of many) is doing a remarkable job paying its debts to its financially stronger European Union partners, Italy, Spain, and Greece are still drowning in debt. There is only so much rich countries are willing to do, especially with the headwinds created by the nationalist movements sweeping across Europe and, last  November, our own amber waves of grain. Greece is in the worst shape, and the world’s bankers think it is months away from financial meltdown.

Courtesy of bespokemag

I knew why, but I asked people there anyway. “The government does nothing for us,” many vendors told me. “They take our money and for what?” I suggested that maybe the government could use the money to improve the schools, repair infrastructure, promote business development, or just cut the grass in the beautiful but neglected parks and other public spaces that keep Greece just a tad less polished than France or Germany. These small proprietors would have nothing of it. They needed that money, and they were loath to give it to a government they see as ineffective and confiscatory.

I don’t know enough about Greece to say the allegation is true, but I certainly saw, amid remarkable evidence of thousands of years of western civilization, a tincture of physical and social decay, and a general malaise, largely among young people. Nearly 25% of them are unemployed, just hanging out at coffee shops and surfing on their smart phones. I don’t know who pays their phone bills.

At the same time, this is a government that requires early elementary school children to learn a second language while their brains are still malleable. It works hard to support tourism which provides many jobs. Signs of investment in alternative energy are everywhere despite the fact that oil is cheap and close by. The pollution in Athens is much less than it was only a few years ago. The government is doing some things that only governments can do, and it needs money to do them.

What do we expect of our government, and how much should we pay for it? How do we make sure that everyone pays their fair share? If government is a service like car repair or house painting, why should some people pay more to have their house painted because they make more? Bill Gates doesn’t pay more for bread than I do although it is a much larger proportion of my income than his. Or, are taxes related to the return we get from the opportunity government gives us to make money by creating social and commercial structures? Should it be the “juice” we pay for our success or just a fee at a toll booth paid equally by the drivers of a Benz or a beater? Either way, taxation requires sufficient faith in government to encourage voluntary compliance. In that, Greece is lacking. Trust in government is essential for an ordered society.  Trust, however, is threadbare in many places for many reasons, including the U.S. Greece just may be the first in the Eurozone to suffer the cost of losing it.

Question: If Mexico had a 5% percent total tax would you move there?

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14 thoughts on “Grecian Earn

  1. MadMan

    Hmmmmm? In response to Gates’ home…..well I’m painting a 3 bedroom house, Gates is painting a multi-property estate…big difference.

    Speaking about no government trust ,,, USA is getting close!

  2. Bob D.

    You were complicit in nothing. The vendor offered a discount to be paid in cash to avoid credit card fees. It is the responsibility of the vendor to pay the tax to the Greek government, not you. The vendor may have avoided paying the tax, but it certainly wasn’t your fault nor your concern for that matter.

  3. Dave

    I would not move to Mexico for any reason. Talk about a government that is incapable of being trusted; the Mexican government is clearly powerless to quell the violence and corruption propagated by the drug cartels. I don’t know how they are able to get anyone to be a prosecutor, judge or reporter in that country. You are as good as dead if you are in any of those roles. Not a place I’d want to live.

  4. Robert

    I agree with Bob D. I have trouble imagining why someone would voluntarily pay more for something (outside of charity) than one needs to. I can’t remember many (any) buyers at my auction sales asking if they could pay more than the final hammer price. Can you imagine Lloyd and Rex coming into the accounting office at an auction sale and saying “Hey Robert, I got a good deal on that RA8, I would like to pay you more”? Then I will have seen just about everything.

    You do bring up some very good questions however.

  5. Chuck SNow

    I would never even go to Mexico again even on a vacation never mind moving there. I lived there for about 5 weeks in 1974 and found it to be a very inhospitable place in which to live and work. I could not wait to get back to Canada. Since 1974 my sources tell me that it has not improved. Unfortunately between drug lords and crooked police and politicians it has become even worse. America and Canada may not be perfect but we are both better places to live …. even with our higher taxes.

  6. Rod

    I am wondering how everyone is feeling about paying taxes here so a person like our new president can go golfing at out expense every weekend. If the last guy was concise red bad, what would you call this.

    1. Doug

      I really couldn’t care less about Trump playing golf on weekends at a resort that he owns. I have a problem paying taxes so that the hopelessly greedy and corrupt government establishment, bureaucracy, and media can spend their every waking moment attempting to undermine, obstruct, destroy, and ultimately oust our duly elected president. They will fight with everything they have to prevent him from accomplishing what we sent him there to do.

  7. Russ Ethridge

    Paying less is why I pulled out some Euros instead of the credit card. I simply realized that my interest in paying less, certainly less than the credit card juice charged the vendor, allowed the vendor to skirt taxes. It is not my problem, but it has become Greece’s.

  8. rick

    with a 5% TAX i could afford all the bottled water I want,

    BUT without the right to self defense and self preservation granted to by our Creator and reaffirmed in our Second Amendment, I would be a mere slave to the drug cartels, and probably dead within a year…

  9. allen

    there seems to be a problem of disappearing posts. Anyone care to shed some light on this mystery?


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