As part of our series on the looming fiscal crisis, we’ve reviewed the grim policies of  France, Italy, the United Kingdom, Canada, and Japan.

Today, let’s turn our attention to Greece, which has the dubious distinction of being the country that triggered the fiscal crisis in Europe that began in 2009.

Will Greece be the first domino again? Here’s a look at fiscal policy this century.

The main takeaway is that Greece has deteriorated this century.

And that’s true. Greece would be in better shape today if it somehow had the same fiscal aggregates it had in 2000.

But comparing snapshots of 2000 fiscal data and 2026 fiscal data misses the huge changes that have taken place between those two years

• An orgy of excessive spending in the 2000s.
• That spending orgy leads to a horrific fiscal and economic crisis.
• The “troika” takes charge in 2010 and cuts spending and raises taxes.
• The tax increases make economic recovery more difficult.
• A new government takes over in 2019 and focuses on spending restraint.
• The burden of government debt falls quickly and dramatically.

How quickly and how dramatically?

According to IMF data, debt was more than 200 percent of GDP in 2020 and has since plummeted to less than 140 percent of GDP.

At the risk of patting myself on the back, this is exactly what I said could happen.

In 2015, I wrote that, “Greece can fulfill its promises and pay its bills. And the recipe isn’t that difficult. Simply impose a modest bit of spending restraint and enact a modest amount of pro-growth reforms.” Voilà!

Now let’s look at a chart I’ve already referenced a couple of times. It shows how several nations (especially France and the U.K.) have suffered fiscal deterioration over the past seven years.

But notice that Greece has moved for a very bad position (the pink dot representing 2019) to a much stronger position (the red dot representing 2026).

This isn’t quite as amazing as what Milei has done in Argentina, but it’s still a remarkable turnaround.

But this does not mean we can definitively assert that Greece won’t be the first domino when the western world suffers a fiscal crisis.

Government is still an enormous burden in Greece, with the public sector consuming half of GDP. And while the debt situation is much better, there’s still more red ink today – as a share of GDP – than there was back in 2009 when Greece suffered a crisis.

Perhaps more important, just as one election led to Greece’s remarkable recent improvement, maybe the next election will lead to a rapid deterioration.

Which is why Greece should build upon its recent success by enacting a Swiss-style spending cap.