Greece has been under intense pressure recently. The economic crisis plunged Greece, like many other nations, into tough economic times.
As Greece has maintained consistently high levels of debt over many years, the downturns in their shipping and tourism economies have meant that they have required more and more debt in order to keep paying their bills.
However there has been a catch.
American debt-rating agencies (companies which essentially set out how much it will cost to take out a loan) recently said Greece might not pay back its debts.
Greek Prime-Minster George Papandreou has even stated that Greece is being 'attacked' on purpose.
Speaking in the Guardian he said, "This is an attack on the eurozone by certain other interests, political or financial, and often countries are being used as the weak link, if you like, of the eurozone. We are being targeted, particularly with an ulterior motive or agenda, and of course there is speculation in the world markets."
So few people are lending Greece money. This has made it impossible for Greece to get the loans it needs to keep running the country and pay back the loans it has already taken out.
And the 'shock' of the Greece financial situation is being used to destroy Greece's welfare state in what is being reported as "the most drastic overhaul of a European economy ever attempted."
Canadian-writer Naomi Klein's book The Shock Doctrine outlines the process that is currently happening in Greece: free market policies which benefit private businesses are being pushed through while citizens are busy reacting to a rough crisis.
Today, Greece was brought to its knees. Another article by the Guardian reports that the three previous austerity measures by Greece to reduce their debt were not good enough, even though they have caused massive strikes and riots in Greece.
In order to receive the €130 billion bailout from the IMF and Europe, Greece will have to destroy their welfare system:
In return for the lifeline, Papandreou has committed to the most ambitious and draconian reshaping of Greece's welfare state ever attempted. Spending cuts amounting to more than €36bn or 11% of national GDP are to be made over the next three years. Wages, pensions, and benefits in Greece's bloated public sector will be cut, and large VAT and other tax rises will be imposed. The retirement age is to be raised. The savage programme will inevitably deepen Greece's recession and push up unemployment.Faced with strong public hostility and possible threats to the longevity of his government, Papandreou is squeezed between intense opposition at home and the pressure of the Germans, the IMF, and the other Europeans. Scepticism is high as to whether he will be able to deliver on the terms of the pact.
This has come a day after major May Day demonstrations in Greece. A bank in Athens was bombed today.
There has also been fears and speculation that Spain, Ireland and Portugal will also face similar debt problems as Greece.