The referendum is the culmination of years of tussling between Greece and Europe, though when we say Europe, we really mean Germany, the euro zone's economic behemoth. Despite a crisis that has sometimes threatened the global economy — and maybe today, still does — Greece and Germany have just not been able to get along. Both certainly understand the ramifications: for Greece, years more of what has already become a Great Depression; and for Germany, its reputation as the linchpin of Europe.
The Germans insist on a tough austerity program in order to continue aiding Greece. Syriza says it understands the need to get the country's financial house in order, but demands the flexibility to do so in a way that it feels is right. Whether Greece's voters have truly had enough of Germany's mandates will be revealed Sunday. Here's a guide to the data on why Germany and Greece are such different countries, among the factors that have made it difficult for them to see eye-to-eye on the most important questions facing Europe.
Two vastly different economies
To start off, an important thing to know is Germany is just a much bigger country. Germany has the biggest population of any country in Europe — eight times as large as Greece's — in part the result of West and East Germany reunifying in 1990, after the end of the cold war.
Despite the difference, both countries share a troubling trend: a shrinking population. Europe is experiencing a demographic time bomb as the continent ages and birth rates fall, leading to questions about whether there will be enough workers to power a dynamic economy in the decades to come.
Not only is Germany much bigger population-wise, but it is also far richer. It has the largest economy in Europe and produces more economic output per person than all but a handful of other, smaller nations on the continent. Greece produces far less . Its gross domestic product per capita looks more like that of developing countries in Eastern Europe.
In recent years, Germany has gotten richer, continuing decades of growth. But Greece has become much poorer.
The future gap seems even worse because the youth unemployment rate in Greece is sky-high. Being unemployed while young tends to stick with workers, depressing their wages and opportunities for years. As a result, the future of employment in Greece looks extremely bleak.
A philosophical interlude
Both Greece and Germany have a fair claim to some of history's greatest philosophers. But by one subjective measure — the prominence of Plato vs. Nietzsche — Greece has the advantage. Plato has 997,000 citations in Google Scholar and 503 books in the Library of Congress. Nietzche has 702,000 citations in Google Scholar and 127 books in the Library of Congress.
Why Germany is prosperous and Greece isn't
We saw that Germany is far better off than Greece, but that doesn't explain why. Well, Germany has a fundamentally stronger economy than Greece. It is more competitive and productive, which allows it to export substantially more goods and services. Greece, by contrast, isn't competitive, paying workers historically high wages, and so it has a relatively small share of exports compared to Germany.
Its biggest export is tourism, but that also makes it vulnerable. Since Greece is on the euro, it can have trouble competing with other European tourist destinations. That's one reason some argue that if Greece leaves the euro and returns to its old currency, the drachma, it will be good for the country: The drachma will certainly plunge in value, and it'll be much cheaper for foreigners to come visit Athens and the Greek islands, making the country more competitive.
This comparison may say more about the difference between Germany and Greece's situations than any other. Germany has fewer outstanding tax debts than any other country in Europe, while Greece has more than any other. In other words, Germany has had almost no problem when it comes to taxpayers paying their bills due to the government, while Greece has had an unparalleled challenge.
That difference not only helps Germany enjoy a far more fiscally sound position than Greece, but it offers a stark contrast between a disciplined government and one that historically has been hardly disciplined at all.
In an interesting sign of its economic advantages, Germany is also a far more technologically connected country than Greece. Wireless broadband adoption has been increasing at a steady clip over the past five years in Germany. By contrast, Greece saw a rise, but it has already started to decline as the economy has swooned. It is another reminder of how Greece, once firmly a member of the wealthy nations, has been taking a step backward.
A safe-haven and a hotspot
For much of this century, the German and Greek governments had to pay about the same to borrow money. That was remarkable, in many ways: Greece had more debt, as a percentage of GDP, but the two countries were part of a monetary union, the euro, and that gave investors about equal confidence in both countries' debts.
In recent years, however, Greece's debt ballooned. Now that it is facing a crisis, it has to pay far more to borrow money. Meanwhile, investors treat German debt as nearly risk-free.
A sports interlude
While Greece may have a philosophical advantage, at least to some degree, Germany has long dominated in soccer, hosting one of the best teams in the world. The Greeks have had their high moments, placing among the top 10 in certain years, but generally have struggled in the bottom rungs of FIFA rankings.
Shades of gray in two economies
In many portrayals of the European debt crisis, Greece comes off as the profligate neighbor and Germany as the disciplined spender. And in many ways that is true. But that is not the full picture. Over the past few years, Greece has taken significant steps to cut its spending. It hasn't been enough to stem the crisis or appease Germany, which hasn't cut spending. But there's no doubt that Greece has done a substantial amount of work to hold to its side of the bargain.
While the Greeks have struggled to reclaim a prosperous economy, by no means are their workers not trying. In fact, Greeks work longer hours than the Germans. That's a mixed blessing: Given that they produce less output, it means they are less productive. But Greeks aren't sitting at home living off government-subsidized pensions, a stereotype that some critics might enlist to push for more austerity in Greece.
Two nations, two different experiences
Both Germany and Greece have relatively little pollution, and beautiful Greece produces even less in harmful carbon dioxide emissions per person than Germany. That may be because it has less of a resource-intensive economy — it doesn't manufacture as many cars — and generally has less economic output per person.
But while Germany may be the land of fast driving, Greece has a far higher rate of road fatalities. Given that Greece is much less developed in many areas than Germany, that isn't too much of a surprise.
In any case, the good news is both countries have made progress in reducing fatalities over the past decade.