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'The Numbers Are Getting Better, The People Are Getting Worse'

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'The Numbers Are Getting Better, The People Are Getting Worse'

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'The Numbers Are Getting Better, The People Are Getting Worse'

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AUDIE CORNISH, HOST:

Imagine if, after the financial crisis, the U.S. economy had continued to sink year after year. That's what's been happening in Greece. Every year the Greek government releases its numbers, and every year the news is bad. The economy shrinks, and people lose jobs. But that may be at an end. Official forecasts predict this will be the year the Greek economy finally turns around. Here's David Kestenbaum from NPR's Planet Money team.

DAVID KESTENBAUM, BYLINE: We at Planet Money have been following this Greek couple who live in Athens throughout this whole mess, Katerina Margaritou and Elias Tilligadas. They have the kind of sense of humor that can get you through a lot of things, but when we spoke two years ago, living in a constantly shrinking economy was taking its toll. Katerina's job had stopped paying her, but she was still going to work day after day. What else was there to do?

KATERINA MARGARITOU: They don't pay us because they have no money.

KESTENBAUM: She was sure the checks would come eventually; her husband, no.

ELIAS TILLIGADAS: No.

MARGARITOU: Yes. I'm sure.

KESTENBAUM: Elias, who worked as a safety inspector, was contemplating learning to farm so they could grow their own food. Katerina was ready to give up everything.

MARGARITOU: Actually I want to leave Greece, to leave from here, from Greece.

TILLIGADAS: No, I'm not going to leave Greece for the second time.

MARGARITOU: I'd like to leave because we have no future here. I...

TILLIGADAS: No, no, no, no. If I leave now, there would be nobody else left behind to save this country.

KESTENBAUM: I called Elias and Katerina again this week. They had not left Greece, and that thing Elias said would not happen, it happened. Katerina started getting paychecks again.

MARGARITOU: I have my job. I'm getting paid every month.

KESTENBAUM: Have you gotten all your back pay?

MARGARITOU: Yes, yes. They don't owe me anything.

KESTENBAUM: Katerina works as a chemist for the government, and the government has finally balanced its budget. The Greek government is predicting this will be the year the economy starts to turn around. The International Monetary Fund has a similar forecast, and so does Nicholas Economides, a professor at NYU.

NICHOLAS ECONOMIDES: I'm very optimistic that the Greek economy will expand this year. We're just not sure how big this expansion is going to be, if it's going to be .5 percent, 1 percent, 1.5 percent.

KESTENBAUM: Small steps. The Greek economy has a lot of ground to make up. Since the financial crisis, the economy has shrunk by something like 25 percent. And the Greek government still has huge bailout loans to repay. But Economides is optimistic about the Greek economy because the government is slowly fixing some fundamental problems though not always in the most graceful of ways.

Tax evasion, for instance, has always been a problem in Greece. So the government came up with an unusual way to collect some revenue - it tacked a property tax onto people's electricity bills. Don't pay, your power could get cut off, clever and hugely unpopular.

ECONOMIDES: But it does provide enough revenue for the government to keep going.

KESTENBAUM: The unemployment rate in Greece is over 25 percent. And for that to improve, someone is going to have to start hiring. Businesses in Greece will have to take a risk, borrow money and expand, or foreign companies will have to come in and open up shop. One selling point for Greece is that, as economists would put it, labor is cheap. With the economic implosion, salaries have dropped. Katerina and Elias, remember, both work for the government. One of the ways the government balanced its budget is by cutting their pay and not by a little.

TILLIGADAS: Forty-five percent.

KESTENBAUM: Your salary was cut 45 percent?

TILLIGADAS: Yeah.

KESTENBAUM: Katerina?

MARGARITOU: Mine only 30 percent. I was very lucky.

KESTENBAUM: What do Katerina and Elias think of those forecasts that the economy could turn around this year?

MARGARITOU: I want to answer to this, ha, ha, ha, ha, ha. That's my answer.

(LAUGHTER)

MARGARITOU: It's funny. It's a joke.

(LAUGHTER)

TILLIGADAS: The numbers are getting better; the people are getting worse. Our lives are getting worse.

KESTENBAUM: When you're inside a big, complex thing like an economy, it can be hard to feel its overall trajectory. But even if the forecasts are right, it could be a while before things actually feel better. A good news headline for a year from now would be: Greek economy finally stops shrinking. David Kestenbaum, NPR News.

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