By on September 11, 2012

This yard in Athens saw an auction every month, selling cars confiscated from drug dealers or tax dodges. Now the state agency has been shut down. Half of the workforce is still there, moved to the books of a government ministry. While the costs run on, there is no more income:  Paralyzed, the unit has seen just one car auction this year. It is a snapshot of Greece’s woes, distilled down to impound level.

Details from the story, pieced together by Reuters from current and former employees and official records, “illustrate some of the hurdles Prime Minister Antonis Samaras faces to his goal of saving up to 2 billion euros by 2015 through scrapping some of the thousand or so similar agencies in the hope of persuading international lenders he can steer the budget towards balance.”

Full story here, highly recommended.

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17 Comments on “This Yard Shows What’s Wrong In Greece...”

  • avatar

    Ever do business with Greeks? They have to get over on you, or you have to let them believe they got over on you. Letting this lot into the EU was colossal mistake. Sorry if that hurts anyone’s feelings, but it’s true.

    • 0 avatar

      That is quite the general, shortsighted comment Skor.. and no, it is not true. It is said that there are two kinds of people, barbarians and Greeks.. I take it you are not the latter. It’s funny that folks don’t share this same sentiment for Italy, Portugal, Spain and Ireland all of whose debts are much higher and far more detrimental to the EU than Greece’s. Was letting them in a mistake as well?

      Give me a break

      • 0 avatar

        Since you’re asking, yes, it was a mistake. Mashing all the economies of Europe together into one currency makes as much sense as having the MLB all-star teams play against Little Leaguers. And all for what? To simplify trade by eliminating currency conversion? A smart phone app could have solved that problem.

      • 0 avatar

        The Irish? you bet it was a mistake, non of the protestant work ethics (was that Weber?) but also non of the fabulous catholic food. ;-) Seriously thou, Ireland was promoted as a shining example of low tax government when in reality the irish where massive receivers of EU orchestrated transfers, some deserved shade freude is aimed at ireland at the moment.

    • 0 avatar

      Yes Skor, I do business with Greeks and Greek companies almost every week (I work in shipping). They are savvy, penny pinching and generally hard to get a good deal out of, but that is why the Greek shipping industry is so strong.
      On the other hand, letting them join the single currency (not the same as the EU by the way) was a massive mistake, as much as letting any country join in a ‘union’ with Germany is a mistake. While I respect the Germans, the society and the economy they have built up, they just can’t seem to shake the idea of a ‘united Europe under Germany’. Take a look at the history books. It never works.

      • 0 avatar

        Congratulations Skor and Sinisterman on starting of the comments with some tired stereotypes about Greeks and Germans.
        From my European point of view (I am in Frankfurt where the European Central Bank resides in view from my office window) both the Greek and German governments deserve a share of blame for the mess we’re in now. But these issues are far more complicated and nuanced than what you’re offering.

      • 0 avatar

        Yes, of course, it’s Germany’s fault. They simply are so German.

      • 0 avatar

        The greek cooked the books, it was clearly unsustainable and fraudulent. The germans did catch a break as the Euro was/are kept lower but they are not trying some fourth reich business but rather insisting on that agreed austerity measures will be implemented.
        One could question why Germany hasn’t fought for sanctions within the EMU for breach of the agreed metrics (60% debt/gdp etc.), the answer is that Germany has been unable to meet the agreed upon targets for fiscal responsibility themself, all the EMU members are or has been in breach of the fiscal targets for the EMU (possible exception Estonia) and non of the non EMU EU countries (exception Sweden) has met and continue to meet the agreed upon criterias for EMU membership since the inception of the EMU.

  • avatar

    What I find interesting is “success” is defined as selling 1M Euro/month of vehicles odds/ends.

    that is 12M euro a year or $16M USD. Compared to greek debt, isn’t that a drop in the bucket ?

    Quote is here:
    “Pointing to an auction held last month as a success, he said online sales could restart this month and he was hoping for monthly revenues of up to 1 million euros. Prime assets included a luxury yacht and cargo vessels still on the agency’s books.”

    • 0 avatar

      I’m surprised inventory isn’t disappearing from this yard sale, it sounds like the staff couldn’t prevent it if they tried and you have economically strong Turkey right next door…

  • avatar

    Privatize it. You have a product you paid nothing for, pay only for staff to monitor it, yet lose money. A (any) private company could bring in enough money to turn a profit and still cover the licensing fees. Of course that would mean firing government employees, which in Greece means protests/riots.
    The same story on another site, also pointed out that many government employees used to cherry pick selected vehicles for themselves or departments to pass out as perks. They paid for them, but because they were the only ones bidding, any bid made the sale.

  • avatar

    Can’t find link, I’m sure not hard to find on google, story about olive oil company that wanted to start on-line business (and succeeded), read what they had to go through to start (involved senior officers and stock holders submitting blood and stool samples to the ministry of health for ___, etc).

  • avatar

    What’s happening to Greece is sad but deserved. Unrestrained government will eventually destroy any nation. They should exit the euro and return to being the low-cost vacation destination for Northern Europe.

  • avatar

    Yes, you have to read the Reuter’s article. This scrap yard is an example of institutions that refuse to die. Before anybody blames the Greeks, I’d like to remind of two examples:

    – Ethanol from corn
    – Mortgage interest tax breaks

    Both of which are nearly universally recognized by economists as being bad for the American economy. Yet they are now deeply entrenched in political life. The Greeks duly deserve the consequences of their actions, but it’s best to see them as an accelerated test case rather than as a morality story. After all, the Swedes can make social institutions work…

  • avatar

    Is the yellow car bottom left a 914? Dang me want! Can I bid in yogurt?

  • avatar

    My take from this article: sticky wages are a real thing and nobody ever consciously argues against their self interest.

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