An Insight into the Problem in Europe

The bond markets, and the German government, are demanding that Greece reduce government spending as a condition of receiving a huge bailout from the EU and the IMF. They cite government spending to support retiring at forty-five, fifty at full pay for many government employees. The government's ability to accomplish such cut backs, and raise taxes, is critically important to economic stability in the EU and then the U.S. The media are creating some minor hysteria that Portugal and Spain may be next.

I don't know anyone in Greece or Portugal any more, so I asked my long time pal, Jose Luis Santos Arrebola, who is a Department Chair at the Universidad de Malaga, a couple of questions. Here are my questions and his answers.

Dear Jim:
Nice to hear from you.I hope you and your wife are goog.

Good question!.
One full professor to be retired have to be working until 70 years old to have the half of salaries when he/she is retired.All workers in Spain the age of retired is 65 y.o. and have the same situation of the salaries, but we when to work until the 70 y.o. to have the total amount

The salaries ,when you are retired, is the same for all the hight professions, 2400€.This amount is net ,but you know the personal tax after one year will deducted other amount.

The salaries ,when you are active person ,for a year ,is around 55.000 € net,but after the personal tax of the year will be 52.000€ depend of the circumstances like you know.
It´s popular now to have a private pension insurance to complete the public pension.

And now the Government,for deficit problems like you know, decide to reduce the salaries all civic servant between 5 to 15% .Perhaps for us It will be 12% less.

Kind regards

Jose



Jose Luis
>
> I have been following the problems in Greece, and maybe Portugal and
> Spain.
> I was wondering how much a full professor at the Universidad de Malaga
> earns in a year and what retirement benefits he/she might expect.
>
> JWT

First thing, 52,000 EUs equals about US$63,000. A similar position at UCLA or USC would pay about $145,000, so it doesn't seem that Spain, at least, is lavishing money on its faculty. It is our recollection that prices in Spain, when we lived there, weren't all that much different from California. However, that was twenty year ago.

The Economist magazine produces a "Quality of Life" index and the 2010 rankings show the U.S. at 15th place with an index of 95.0. Spain is 16th with a score of 94.9 so the two countries aren't all that far apart in living conditions.

I don't know of anyone in the U.S. who has to work until seventy to retire.

So it doesn't look like there is a lot of room for cut backs in Spain. That may be good news or may be bad news. Anyway, it is one small set of facts devoid of hysteria.