By THEO YANOS, age 10
Debt and lending money are complicated issues. When people hear of the “debt crisis” affecting countries such as Greece, they wonder, “Why doesn’t the U.S. have the same problems?” That’s because the U.S. keeps raising the “debt ceiling.” It also has its own currency and can print money, unlike Greece. So, should Greece go back to its old currency, the drachma?
It’s not that easy. The Greek debt crisis is the result of the European Monetary Fund (EMF) and European Central Bank (ECB) demanding budget cuts and pay cuts of up to 30 percent in civil servants’ salaries as a condition of new loans to Greece. Civil servants are public workers who work for the government and whose salaries are paid for by taxpayers. For example, school teachers, librarians and police who work in the public sector are civil servants.
The main Greek political parties have different ideas on the best way out of the crisis: Panhellenic Socialist Movement (PASOK; a center-left party, like the Democrats in the United States) is working with New Democracy (a center-right party, like the Republicans). The two parties have agreed on many rounds of austerity, or cuts in spending, even though they are worried about cutting too much. PASOK believes that negotiating is the only way to stay in the European Union, or EU, and the Eurozone (countries in the EU that share the same currency, the euro).
Syriza is a radical left party that believes that Greece should not make any cuts, but still wants Greece to maintain its economic ties with the rest of Europe. Elati, from Syriza’s youth group, says: “The answer [is] where we cooperate with the other countries that face the same debt problems.”