Rory O'Farrell: Government deficits can be broken down into two parts: interest payments and the 'primary balance'. The primary balance includes everything other than interest payments; so it includes social welfare, money raised through taxation, salaries etc.
Greece is often portrayed as a basket case that just can't get its act together. However, as can be seen (click graph to enlarge), Greece's primary balance is better than France and Netherlands. Greece's problems are largely due to the legacy of the past.
Dr Rory O'Farrell @r_o_farrell
Rory O’Farrell is an economist at the Dept of Economics, OECD, with extensive post-PhD international work experience. His research has been in the area of public policy, labour economics, fiscal policy and monetary policy. He has experience with macroeconomic modelling, calibrating Mortensen-Pissarides matching models and forecasting.
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