AND NOW FOR SOME LIGHT ENTERTAINMENT...

This fiscal stuff is really vexing, so here's a little refreshment, courtesy of the Annals of Improbable Research, the most truly fantastic online resource in the world. They are better known for running the Ig Nobel Awards and their website is well worth a read.

The new Greek tax system, we can be assured, will include some tinkering with estate tax - the unsavoury practice of taxing the wealth that people pass on to their offspring upon dying, although it's already been taxed when it was earning interest or capital gains and, of course, when it was earned in the first place.

So what if there were a hidden downside to the death tax? I do not mean the usual tax-dodging response which, as per the Laffer curve, reduces tax revenues when tax rates go up. I mean an even darker effect - the direct effect of pre-announced estate tax increases on longevity.

The research quoted by the AoIR, available here, was actually carried out by esteemed scientists in Columbia. It found that, when people know estate taxes are about to rise, they adjust their time of death (or have their time of death adjusted for them) in order to maximise the wealth of their offspring. This is an honest-to-God significant effect.

This in itself tends to mean that estate tax increases will almost never yield the amount expected by governments. But it gets worse. In Greece, a great many property-, business- and home-owners liable for estate tax are also enrolled in our famous -and famously inefficient- public final benefit schemes. Can you guess where this is going?

The fiscal straitjacket imposed on Greece by Brussels makes it impossible to sneak any tax hikes up on the population - they need to be announced to Brussels and shouted from the rooftops to make sure our friends in the bond markets can hear. So any new estate taxes will give people ample time to prepare.

So what if the notoriously long-lived Greeks decide to live longer and screw the system even harder? Their pension payouts will rise, adding to the pension fund deficits and thus to the state deficit (as all public pension fund deficits are, by law, the state's problem). Which could mean higher estate taxes will actually cost us more money than they earn.

And, of course, as our healthcare is strongly subsidised and in fact much of it is publicly provided, all these cunning derelicts will take us for a real ride on their way out.

If you're smiling ruefully at the irony of all this, remember - it's all bullshit except for the facts.

DAS POO!

My vulture -meter went off the charts today and I had to check what the matter was.

It appears that our leading centre-left daily, Ta Nea, reported that the EC is about to reject our updated Stability and Growth plan. The original Greek article can be read here. I must note in the interest of objectivity that our government denies this, suggesting instead that the document seen by the journos is actually old news. And to be fair the document they offer for our scrutiny is a bit of a mess.

But why would the daily closest-aligned to the government hit them so hard in the balls at this very very inconvenient moment? Conspiracy theorists, we need your comments.

Finally, I am reading that in the midst of all this our Prime Minister took a bit of time - to the consternation of Davos attendees aligned to the financial sector - to watch clips of Avatar in 3D with James Cameron himself. Three possibilities.

1. He thought it was a presentation by David Cameron.
2. He misses the good times when beating the Blue People was his biggest concern.
3. He was  tired of being followed by FT correspondents and went into the last room they would think to look.

LOLMAN?

Original story here.

I am willing to bet that the editors of the Greek Communist Party instrument, the Radical, will leave this story as it is even after somebody inevitably picks up their reference to "Golman Satz". Is it not appropriate that the last unreformed Communist party in Europe can't even spell the name of the Vampire Squid?

AI IZ IN UR PROCUREMENT AGENCIES, DRIVING UP UR INFRASTRUCTURE COSTS

Eleutherotypia ran a long article about a week ago on the major Greek road works, citing "an EC report" which found endless budget over-runs and extremely high costs among the Greek projects funded by the 3rd Community Support Framework (CSF III). I have no doubt we're not doing very well. Perhaps because we're getting people like this to do the work:




In most policy circles, it is considered polite to offer citations, but journalists have no time for such niceties. Perhaps if any of them actually got paid, they would be able to afford a home computer so they could double-check what their well-placed "source" was saying.

Here is the link to the actual evaluation study. Note the database of CSF III public works in excel format. That's where the money is.

HO, HO, HO(Z), MERRY LOLMAS

All this doom and gloom could yet make us forget the happy times, the good times, when Greece was a proud and prosperous nation.

Back then, we counted prostitution and money laundering against GDP in what must have been the the ultimate LOL Greece moment of the decade.

Of course, from some perspective it all makes sense. Try this one for instance:

LOL GREECE SPOOF BANKING AD

CUT IN DEFENCE SPENDING DELIVERS SAVINGS FOR GREECE

Nobody shoots donkeys anyways.

http://www.forbes.com/feeds/afx/2009/06/16/afx6548315.html

SUBMITTED BY FUFURASU.ORG

NO! YOU IZ FAT CAT AND MUST GIVE US 90% OF UR NOMS.