What is wrong with Greece?

Politics Reporter explores information and reports that are already in the public sphere and asks for people to see Greece as a nation and not a population mass

Nigel Farage, head of UKIP, became popular among Greeks recently when he described the non-elected prime minister of Greece as a puppet of the IMF-EU-ECB troika concluding that Greece has no democracy at this moment and if he was Greek he would be among the protesters in the streets. This was enough to make me listen to what UKIP had to say, as well as pay closer attention to the European Parliament in Strasbourg.

Among others, Daniel Cohn-Bendit (European Greens) accused Germany of hypocrisy due to Germany never having paid their debts to Greece while Austrian, Johannes Swoboda, said that the IMF and the EU are merely exhorting Greece when the country is in need of advice, not this externally imposed dictatorship.

Indeed, after nearly two years in destructive recession, the media and public opinion across Europe are becoming more sceptical to the Greek problem. The Telegraph compared the terms of Germany on Greece with those of Rome on Carthage stressing that when Germany was brought to its knees by its wartime debts back in 1953, all countries, Greece included, helped Germany to stand back up.

The pinnacle so far was the demonstrations across the world on Saturday February 18. Those demonstrators, asking, “what if our countries are next,” received thanks from the Greeks in the streets and the Greeks of the diaspora, but of course nothing from the ‘Greek’ government.

Thirty-five years ago, in 1976, the IMF visited the UK when the government asked for a 2.3 million sterling loan, in exchange for painful cuts. The IMF has consistently ruined the economy of every country it went to in the past twenty years. The results are alike everywhere: hundreds of thousands of jobs lost (private sector included), drastic reductions in public expenditure, strenuous cuts in salaries and pensions and loss of GDP.

Countries visited by the IMF in Europe recently include Romania, Hungary, Ukraine, Latvia and Russia. One cannot help but wonder why any government considers deciding to knock the IMF’s door when there is such a thread of countries across the world that display exactly what is in order.

At the moment, there is a little known legal inquiry in Greece that addresses revelations that certain key persons of the national statistics agency were forced to falsify the country’s data so that the public debt seemed large enough to justify the calling of the IMF.

According to Paul Krugman, who holds a Nobel Memorial Prize in Economics, the IMF’s own Debt Sustainability Analysis states that for the continuing and additional austerity measures to have any positive effect, the Greek economy must display a minimum of 2% growth within the first half of 2012. While admitting this is impossible however, they demanded these measures and imposed loathsome terms on Greece in spite of the country’s recession deepening.

John Maynard Keynes once said, commenting on Germany’s post-WWI debts, that Germany, by accepting unrealistic terms that weren’t viable, was as guilty of what happened in the following years as the Allies who demanded these terms they had no right to impose. It appears that the people of Greece view this government as a mere employee of the troika (and thus as guilty as the troika) that has no ties to the people. The obvious question arising is “who is being bailed out?” As the BBC have reported: definitely not Greece.

Greece itself is fully covering the country’s expenditure, wages and pensions from its own internal revenues, even after these terrible years of steady economic destruction. Not a single eurocent of the so-called bailout goes into the country. This money goes straight back to the ‘rescuing’ bankers to pay interests upon interests. Essentially the poor are bailing out the rich as The Telegraph recently put it. It is even more apparent with the latest ‘bailout’ according to which the country’s incomes and expenditure will be regulated externally. Since the people of Greece are still able to internally run their expenditure. This would point to Greeks being forced to terminate fully productive state-run organisations and selling out everything. In considering privatisation all that is needed is to recall what happened to Britain when the railways were privatised in 1994.

At the moment, existing Greek parties are consumed by accusing each other without coming up with a plan for a commonly accepted solution. That may remind us of how the German parties spent the years from 1929 to 1934 arguing, thus allowing the rise of the Nazis. Or perhaps how Franco won the Spanish civil war thanks to the conflicts that tore apart the democratic side from within.

Issues endangering the country’s sovereignty arose when the German finance ministry suggested that an EU commissioner should be based permanently in Athens, a modern day Gauleiter. At least Erwin Lotter, member of the German Parliament, apologised to the Greeks for that. Angela Merkel said of course that she will not accept a Greek default as a result of the Greeks’ unwillingness to accept yet another ‘bailout’. It followed, however, that the ‘Greek parliament’ accepted this new bailout’s terms.

Five professors made a joint statement to academically display how unconstitutional the entire process is. These terms include the total forfeit of the country’s sovereignty and all of the state-protected assets and they even impose the foreclosure of privately owned assets. The whole agreement is subject to English law and the court responsible to allow all these is set to be in Luxembourg. The fact that the initial lending agreement did not get through the parliament in the first place demonstrates that the troika’s impositions are lacking of any legal backing according to the Greek Constitution, the EU and international laws. Until the relevant laws change that is.

German Zeit stated “let Greece be, this country is not an exemplar to avoid, but an opportunity for the EU to prove that it is a union in the true meaning of the word.” In light of that last comment we can understand the growing of euro-scepticism across the continent, which can be summarised in The Guardian’s article ‘Shame on Europe for betraying Greece’.

German minister of finance, Wolfgang Schäuble, suggested that Greece and Italy should remain with these provisional governments of ‘technocrats’ (Papademos and Monti) and mentioned the examples of Ireland and Portugal where the politicians agreed to postpone elections. We now see obvious interventions in the internal political affairs of countries otherwise considered to be sovereign states. In complete agreement with Mr Schäuble, the relevant press release of the ‘Greek’ government said: “the urgent duty of the provisional government is to implement the agreements; we can’t predict when it will be that elections will take place.”

At this point it might be beneficial to clarify the ‘bail out’ that Eurogroup came up with on Tuesday February 21. An account is set up where the alleged 130 billion go directly and return straight to the lenders – fair enough. All income and revenues of Greece also go in that account before going for any domestic expenditure. This means that serving the interests of the lenders comes first and the populace of Greece second. The lenders will be taking what they need and what is left, if any, will be spent in the country. The Greeks have long since had enough.

Now the ‘Greek’ parliament votes that the debt payment will have top priority over all other public spending. As for the ‘haircut’, it is voluntary. This means it is agreed but not specified on which parts of the debt it will take place on, thus it will be the bonds that the Greeks themselves hold that will lose part of their value.

There will be permanent EU officials monitoring the money flowing where they want it. It is interesting to note that while these ‘small prints’ made their way to the world’s media as far as the US, they seem to have lost their way towards Greece’s mainstream TV channels. Also in Greece, school pupils faint in class due to malnutrition. The Guardian commented: “whatever Eurozone finance ministers were smoking in their all-night marathon talks it must have been something strong.”

A reasonable question for all parties involved in this continuously inconsistent process is: have you taken a look at Greece lately? One in every four Greek businesses has already gone since 2009. Unemployment, cost of living and suicide rates have consistently risen while wages and pensions fall.

Among the young the unemployment rate is above 50% already and the GDP has dropped by 17% since the crisis started. And to complete the picture the Greeks are emigrating in the hundreds of thousands.

It is interesting to note how both Greece and Ireland, two nations with parallel lives, suffer from this diachronic curse that most of their people need to live abroad, in order to live with decency. The Business Insider has said: “[i]n other words, the Greek economy is imploding, in the full sense of the word. And another round of austerity is supposed to fix this?” The BBC asked ‘when was it that you last walked the streets of Athens Mr Juncker?’ to stigmatise the apparent indifference of Jean-Claude Juncker, head of the Eurozone’s ministers of Finance. The people want the country’s default, and as one may read in Financial Times “Greece needs to default if the country wishes democracy.”

Europolitique, a European affairs daily bulletin, published an article titled ‘Quo Vadis Europe’ where it was argued that the EU should consider a ‘Marshal plan’ for Greece instead of asking the Greeks to commit suicide. The Austrian journal Profil called those who demand Greece’s utilisation as a financial lab-rat to answer whether they would be willing to enact the same measures on their own countries, concluding that if such austerity was enforced in Austria that would be the end of Austria. Willem Buiter, of Citigroup, also called for the repudiation of the debt stressing that the Greeks are squeezed and there isn’t anything left to cut. Even Der Spiegel called for an end to the bailouts describing the matter as a bad farce while also acknowledging that the country’s sovereignty has been ruined.

Declan Hill, of The Ottawa Citizen, wrote that Greeks have good reason to protest as he realised that the people protesting in the streets are all the Greeks, regardless of class or ideology (the far left anarchists and the far right nationalists join forces in the protests). The Spanish 20 Minutos suggests that the Greeks do not trust anyone anymore as this people’s patience has long since been exhausted.

On Sunday February 12 there was no city where protests didn’t take place in Greece. The people’s voice was countered with a lot of tear gas and the burning of Athens’ historical city centre. That day is treated as the Greek equivalent of Germany’s burning of the Reichstag in 1933. Lets hope that no Kristallnacht will follow. After that fiery Sunday The Guardian asked, “is cradle of democracy finished democratically?”

Talking of democracy, elections were meant to take place in February, or so it was said back in October 2011. Currently the ‘Greek’ government and the EU constantly push the alleged elections further into the future, since it is obvious that the people will not allow themselves to vote for a pro-IMF government yet again, while demanding signatures from all political leaders that they will continue to serve as dictated no matter what the result of the upcoming elections. With what legitimacy does an interim non-elected government sign agreements that tie up the country for generations to come has yet to be displayed.

In order to make the Greeks’ feelings more understandable the following example that a lecturer of Cardiff University placed on his noticeboard is helpful: Ten years from now a child might ask ‘what did you do dad when they sold the NHS, closed the libraries and privatised the schools?’ and dad replies ‘I voted in X-factor and filed a complaint because blackberry network was down.’

Let us turn our attention to the cold north. In 2007 Iceland’s debt was 900% of its GDP and the following year they had to default. The IMF and the EU came along to ‘save’ the island nation. As the Icelandic prime minister said: “they said if we’re to repudiate the debts that our people were not responsible for, we would become like Cuba. But if we were to follow their austerity program we would become like Haiti.” Thus with a referendum in March 2010 the people decided to reject the debt and a new constitution was made for which practically the entire population participated by viewing it, commenting and suggesting on it on-line, while those responsible for the mess fled the country.

Iceland’s GDP was reduced by 6.7% in 2009 but was increased by 2.9% in 2011 and continues rising while the unemployment is at 7%, which is relatively low. Those that threatened not to support the country again if they were to reject those debts are now lining up for business and investments. Iceland also cut a significant part of the private debts to avoid having a homeless population. In Iceland the banks were nationalised while in Greece the state is bank-ised with a non-elected banker as head of government (who has been head of the Central Bank of Greece and vice-president of the ECB) to make sure that banks (alone) remain profitable. The small nation of Iceland that numbers 320,000 people proved to the world it has the right to be a nation. It is now the turn of the Greeks to prove that they deserve to rule their country themselves too. To declare they deserve to be a nation as opposed to being a population mass.

Allow me to finish with a story told by a friend who was in the streets of Athens on fiery Sunday: there was a girl in Syntagma square carrying a pot with an olive tree. In the otherworldly environment created by smoke and tear gas she was there speaking to the plant. Her voice was that of a mother tending to a child getting a scraped knee in a playground. She turned and said that there’s tear gas all over the leaves, that this day has changed her life forever and that the olive tree is not for those in the parliament but for the people outside. Was it the girl? Or was it Athena impersonating the girl, lamenting for her city with her offering, the olive tree?

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  • This article is abominable. It should be under the opinion section rather than politics, since it contains strong, one sided views. Whilst, I applaud the different view it takes on the Greek problem, I do not agree with its misuse of statistics and its comparison of Greece to Iceland. Overall, a badly written article with a bizarre, pointless anecdote at the end.

    • We have always had at our heart that a student politics section should represent the views of students because the normal person can get their politics news from the mainstream media. We gave the writer much licence in this article because it is a topic close to his heart and we apologise if you think it was inappropriate. If, however, you would like to write us an article that balances this ‘one sided’ article then we would welcome it. Our email is politics@gairrhydd.com is you would like to get in touch. All the best, Luke (Political Editor).