The New Greece

Due to Gizikis government's inability to gain control of Cyprus, in July 1974, voluntarily, was handed over power to a civilian government headed by Karamanlis, who returned from exile. Most exiled politicians (notably Andreas Papandreou), potettero back in Greece, all political parties (including the Communist Party) was allowed to operate freely and the 1951 constitution was reinstated. In a 1974 referendum, Greek voters voted against the establishment of a new monarchy and expressed themselves in favor of parliamentary presidential republic.

Karamanlis and the New Democratic Party were reelected and retained the majority in 1977. In 1980, Karamanlis was elected president for a term of five years, and Giorgios Rallis succeeded him as Prime Minister. In 1981, Greece became a member of the European Community (now European Union). The Pan-Hellenic Socialist Movement (Pasok), under Papandreou, joined the majority in the elections of 1981 and 1984, putting an end to 35 years of pro-Western government and the conservative state. Under the socialist governments of the year 1980, support for the public sector grew, and many state enterprises continued to lose money. The Pasok failed to retain power in 1989, but three elections were needed before the conservative New Democracy party in 1990 assured a new parliamentary majority of one vote.

Constantine Mitsotakis then became premier, and Karamanlis was elected president for the second time. Faced with a record deficits and high inflation, the Mitsotakis government instituted a severe austerity program and started large-scale privatization of state industries. In the 1993 elections, Pasok regained the power, with Papandreou as premier, and privatization programs were reduced. A dispute with Yugoslav Macedonia was resolved in 1995 when the new republic agreed to change its flag and renounce any territorial claims against Greece, but the use of the name Macedonia by the neighboring country has continued to be a source of discussions in Greece.

Karamanlis retired as president in 1995 and was succeeded by Costis Stephanopoulos, who was reelected in 2000. In January 1996 Papandreou, who was then seriously ill, resigned and was replaced by the moderate Socialist Costas Simitis, who continued the series of economic reforms aimed at preparing the nation to join the European Union's single currency (the euro), which was adopted by Greece in 2001.

In 2000, Simitis and Pasok retained power after a narrow victory in general elections. Even if the economy generally improved under the Socialists, the unemployment rate remained high and corruption scandales hurt the party. In the elections of 2004, the New Democracy party won a majority in parliament, and Costas Karamanlis, nephew of former president, became premier. Karolos Papoulias was elected president in 2005, succeeding Costis Stephanopoulos. In January 2008, Karamanlis paid an official visit to Turkey, the first of a greek prime minister in half a century.

Financial Crisis in Greece

The economic crisis of 2008-2011, the United States originated with the subprime crisis, has expanded rapidly in several European countries, and grants many of the old continent have accumulated losses over the years. Some countries have suffered serious effects: Denmark into recession, even worse, Iceland.

In Greece, more than in other countries, became apparent fragility that has taken shape with high unemployment rates and high corruption. The emergence of Greece at the beginning of December 2009 triggered the downgrade by Fitch, which cut its rating to BBB + long-term debt greek. A BBB-is that the threshold of junk bonds, or junk title. It turns right at that moment that the statistics sent from Athens to Brussels on the progress of the Greek economy and the budget are false. Aided by the change of government leading the Socialists by George Papandreou to govern the country, is revealed to the world that in 2009 a deficit has surged from 3.7% to 12.7%. Clearly, the findings were flawed and the charges do not prevent the previous government that Greece and the European Union find themselves suddenly in the middle of an unexpected crisis.

The numbers that emerge are more than alarming public debt greek flew to 300 billion euros, or 113% of GDP and could rise to 120% by 2010. The government seems unable to curb public spending and structural reforms expectations point to a lasting political crisis. While rating agencies cut their rating on the debt of Athens, many economists and observers are beginning to assume a dafault of Greece and its Eurozone output, because the Maastricht Treaty explicitly forbids a bailout of the nations in crisis.

It is equally clear, however, that a crisis of this magnitude might infect other economies of Europe with a weak and unpredictable effects on exchange rates throughout the euro zone. German Chancellor Angela Merkel now intervenes with determination: "If something happens in a country of the euro, all others are involved: we have seen that a common currency, we also have common responsibilities."

The Athens government prepares a plan for exit from the crisis with billions in privatization, a freeze on civil service salaries over $ 2,000, an increase of VAT by 2 percentage points (increasing to 21%), a strong fight against tax evasion, tax increase on fuel, alcohol and tobacco, reduced bonuses in the public sector by 30% and structural reforms such as pensions. In January 2010 the Prime Minister George Papandreou announces a greek stability program with the objective of reducing public debt from 12.7% to 2.8% of GDP.

Eurozone Finance Ministers approve such a package of aid for Greece from 30 billion euros. The Prime Minister George greek Papanderou announced that has reached an agreement with EMF and the EU for a bailout of the country in exchange for additional budget cuts for 30 billion euros. The package includes aid for 110 million euros in three years. The greek Parliament therefore approves the austerity measures introduced by the Government. Moody's, Standard & Poor's and Fitch cut the rating further assessments on bringing in Bal tiotli Greek, then Greek titles become "junk".

Finally, the President of the Eurogroup, Jean-Claude Juncker warns Greece on the importance of controlling public spending the next day that Athens has announced that the deficit for 2010 has exceeded the threshold of 10% of GDP. In Brussels and Davos will be discussed the problem, but the impossibility of helping Athens directly forces the "greats" of Europe to seek solutions to prevent that a transverse collapse would harm everyone.

In 2011 the financial market crisis and the economic instability of Greece become deeper until the necessary request from the EU to Greece to launch a final austerity plan. This will lead to severe social unrest, strikes and demonstrations until the resignation in November 2011 of George Papandreou as Prime Minister to allow the establishment of a Greek national unity government capable of tackling the crisis.