The European Commission yesterday announced that it will be keeping Greece on a tight-leash in relation to getting its ballooning deficit under control.

Greece itself and other commentators are optimistic that the government will bring the deficit under control, but that the path ahead “brings with it risks”. In reality, what choice does Greece have? Not much. The nation’s economy has followed in the footsteps of the financial markets’ collapse in the sense that those involved knew the bubble had to burst, and did nothing to stop the ballooning deficit gap. It was similar in the financial crash – those in the know (the real know), knew what was happening and they did nothing to stop it.

Perhaps the situation is like the proverbial lie that has to grow to epic proportions and burst before the teller of the lie will acknowledge their deceit. And this is exactly what has happened. Greece is on the brink of collapse and this has rattled the eurozone, the euro has slipped as a result, as has consumer confidence. Just when Europe was feasting on the good news of all major economies seeing signs of recovery – this happens. While it has knocked confidence, it is too early to say whether or not it will push Europe into a W-shaped recession, an issue we have discussed at length in other editorials.

But what is certain is that Greece’s situation was brought about by greed – living a life that was unsustainable and that the country could ill afford.

Greece is known to have a very poor production to wage ratio – in other words, what was being produced by the economy was not enough to cover the country’s way of life. Since it joined the EU, Greece has always been a poor economic performer. Just a couple of decades ago, the country had massive unemployment and poor rural education and opportunities. Not that much changed in the build up to the millennium, but then the Olympic Games returned to Athens in 2004. The country simply could not afford the show it put on and the infrastructural nightmare that went with it. The government paid over the odds to implement projects that have helped further widen the deficit. It is now six years later and it is 2010. The Greek situation has come to a head and the Commission has stuck its neck out further than it ever has before and has said that it will continually correct (hound) Greece wherever it sees any shortcomings in its tackling of the deficit situation.

This must not happen to Malta. We weathered the financial crisis quite well, although we are still struggling with recession. We were warned some time ago not to put our wages up unsustainably by the International Monetary Fund.

Without talk of economics, growth and deficit and coffers – it is simple – one cannot be greedy and one cannot have their cake and eat it too. Economies are what they are, and while the Capitalist system – with prudent application – can allow for prolonged sustainable growth, it does not allow for mass fluctuations. One can expect that the European Commission will be more stringent in its observation of individual economies and its corrective interventions.

If we live beyond our means for five years, it will take us 10 years to pay it all back. Just ask the Greeks in a decade or so.