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1. Ever since WW 2, Greece has been spending much more than it made in State income, partly because other nations always supported this with aid and loan programs. The traditionally strong influence of Communist trade unions had much to do with the loans and with Greece living beyond its means. The West during the Cold War years saw turning a blind eye to this situation as a way to keep strategically located Greece in its fold.
2. Since tax dodging was a national pastime, encouraged by a very lax policy of Greece's Internal Revenue Service, Greece's economy was for a large part an 'underground' economy and still is.
3. Greece's economy would already have long been bankrupt if it wasn't for billions of additional aid in the last few years.
4. The aid in the form of ever higher loans to be repaid have become so high that Greece will never be able to repay them.
5. The conditions of those loans are such that Greece has been forced to severely bring down ordinary Greeks' net earnings and State expenditure. This in turn has led to a severe reduction in Greece's economic activities and has further reduced its earning (and paying back-) capacity.
6. The traditional 'natural' way to recovery - devaluation of its currency, making its own exports and its main source of income, tourism, cheaper and so more attractive and at the same time making imports more expensive - is blocked: Greece is tied to the Euro and so is in the 'unnatural' position of an extremely weak economy with an - in relation to that - extremely strong currency that makes growth through export gains and tourism income impossible.
7. More than 80% of all the new loans are not used to restructure Greece's economy and help boost its earning capacity; practically all the money has been used to make Greece pay back the loans extended in the past by mostly EU banks. These have now been saved from taking enormous losses on the outstanding Greek debt that they held. Instead, EU taxpayers' money has now replaced the debts to EU banks.
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