"Whaaat..? The store next door is closing down..?
We're closing down too...!!!!
HURRY! Up to 60% off."
We're closing down too...!!!!
HURRY! Up to 60% off."
I wanted to write something about the way greek media talk about the ongoing crisis we're going through, and how they try to keep quiet about the people protesting etc. But I ran into this and this article from http://teacherdudebbq.blogspot.com/ which I think tells the story as good as I'd say it. If you want to compare what's written in these blog posts to the way the Irish media talked about their own bailout program, please watch the video below (video from Mega Channel, the most popular private TV network): Looks like the greek media don't mind showing how the irish media reacted to the announcement of Ireland asking for a bailout.
On the contrary, this wasn't the case on November 17th. This day is an official school holiday for the memoration of the Polytechnic Uprising that took place in 1973 against the US-backed dictatorship. The same TV network - Mega Channel - on their November 17th 8pm news, didn't spend a single word on this anniversary. They didn't even show the greek PM and other government members leaving flowers at the monument for those who died during the uprising. They didn't even say that this day is an anniversary of anything. This yearly march was joined by some 40.000 people in Athens, and several tens of thousands all over Greece. Hundreds of thousands of kids celebrated this day and sang songs written for this special day at their schools' yearly event. How would an American feel if the celebration for the 4th of July wasn't mentioned on the news? How would a French feel if the celebration for the 14th of July wasn't mentioned it on the news? How can these people at the most popular TV network in Greece believe that this way they managed to "hide" the protests or all the other events from the people? This day is called in Greece the "Celebration of Democracy day". Quite a few members of the parliament today, built their careers on the fact that they took part in the Polytechnic Uprising of 1973. How ironic is this? How shameful? - The EU-IMF are blackmailing the greek PM: “If you don't get the additional measures that we demand, there will be no next loan installment and we will leave the country to default on its debt.”
- The most powerful workers' unions – who are still supporting the government - are blackmailing some of the parliament members: “If you vote the additional measures that the EU-IMF demands, you'll never be re-elected again”. As a result... - ...some parliament members are blackmailing the PM: “If you suggest that the Parliament has to vote for additional measures we will vote against this and the government will fall.” - The Left is blackmailing the government: “If you vote for additional measures, we will organize continuous demonstrations and strikes and will immobilize the country.” At the same time, the greek PM is blackmailing (who?) by saying that “if our party doesn't win the upcoming local elections, I will call an early national vote” only a year after the last one. Sometimes I wonder if all this is the result of stupidity or if it is all done on purpose. I'm - by nature - against conspiracy theories, but I can't see a third reason why everything's been going so bad. It seems like no one is truly aware of the significance of the country's situation:
As things are right now, it's obvious that the current government can't function properly. They have done a few things that showed the EU-IMF they can get the job done, but still we are far from seeing any actual results. There is a lot more to be done and they've dangerously slowed down their pace, in fear of the consequences. To me the only solution is the formation of a coalition government – as it happened back in 1989 – so as there will be no more space for blackmailing in the interior. They would have to work hard and united for the next 3-4 difficult years, until the country gets some stability and then everyone can go back to their different opinions and do what they think best. Unfortunately, I don't see this happening. The greek politicians for once more prove to be short in front of the circumstances. I would accept failure if Greece was in an irreversible situation. But it really makes me sad and angry to see that even though there is a chance for (a painful) salvation, the country falls apart day after day, just because our “leaders” are so short-sighted and fear their responsibilities.  Here's a picture of the statue of George Canning, on Canning square, central Athens. Recently someone wrote on it the phrase “Our first loan”. Please let me explain:
The Greek Revolution against the Ottoman empire, started in 1821. In the beginning, it didn't look like a large scale revolution at all, as it was mostly taking place at a small part of Peloponnissos, in southern Greece, and it didn't worry the Ottomans. The Greeks had unimportant military power and no support from abroad, in terms of diplomacy, finances or weapons. Only when, later on, the British and the French decided to offer this support to the Greeks, it seemed likely that the revolution would be successful and that a new Greek state would be founded. Until then though, the 3 european Great Powers (British Empire, France, Russia) don't seem to care about the revolution. But in 1823, George Canning, who was then the Foreign Secretary of the British Empire takes a sudden turn and recognizes Greece as a sovereign country. We don't know if Canning liked the greek people, but we know that he saw greeks as a good chance for Britain to step in the eastern Mediterranean – against the Ottoman naval monopoly in the area. You see, at that time the Brits had to ask for the Ottomans' permission to get their cargo back and forth to India. Right after the recognition of the Greek state by the British Empire, Canning offers the greeks 2 loans to “help” the revolution. The first loan was given on November 1823. The greeks took 472.000 british pounds and the overall interest was 69%. The second loan was given on 1825, and was 1.032.000 british pounds, with an overall interest of 93%. One would say that Canning probably didn't like the greeks... Whatsmore, at this point, there is yet no real greek government, but rather a bunch of non-elected rich greeks (ship owners etc.) who have decided to represent the greek people in Europe. So the actual money Greece got was 1,5m pounds. But still, only 0,5m pounds made it to the country's treasury. The rest was shared among the negotiators of the loan, the british bankers, the greek ship owners and to other “hidden costs”. These 2 loans were called the “Loans of Independence” - a phrase that is a paradox by itself. The most well known example of the splurging that took place is the wages of Lord Cochrane who served as a Rear Admiral in the Greek Navy (he also served in the navies of Chile and Brazil, during their own wars of “independence”). His yearly wage was 57.500 pounds which according to the historian Dertilis was equal to a 50-years income for a middle class family at that time”. I don't know if it matters to anyone, but except for countries that once belonged to the British Empire (Australia, Canada etc.) the only places on earth named after Canning are this square in central Athens, a street in Buenos Aires, Argentina (which was renamed lately) and a street in Rio de Janeiro, Brazil. This is an interesting coincidence, since all 3 countries have gone through IMF programs in the last decade. Back to today, when another story of independence unfolds before our eyes: The chairman of Eurogroup (that is the meeting of the finance ministers of the Eurozone) Jean Claude Juncker, stated that both the German and French governments knew about the greek debt crisis but did nothing to stop it, and that they intentionally left Greece to get where it stands now. It was of their interest to keep quiet, because Greece had money to spend, even if it wasn't its own money, especially to buy weapons from them. (take a look at Turkey's PM statement on the subject) It was of their interest to let Greece get a step before bankruptcy, so they can now buy Greece's state enterprises cheap. The exact statement of Juncker: (copying from the French Press Agency, AFP) Eurogroup chief Jean-Claude Juncker said Friday that Greece's financial woes were well known among top EU officials but kept quiet until the crisis erupted last year. "It was quite obvious that one day Greece would have to face this kind of problem, and we knew that this problem would occur," Juncker told a forum on the sidelines of the International Monetary Fund and World Bank meetings in Washington. Juncker said German and French officials along with European Central Bank chief Jean-Claude Trichet had for some time been discussing "the perspectives of what was not at that time known as so-called Greek crisis." "I could not go public with the knowledge that I had," he added. "The Greek crisis could have been avoided, but not starting last year, starting two or three decades ago," the European finance ministers chief said. Juncker said he tried at one point to seek a solution to the problems with an unnamed Greek prime minister who told him: "I am governing a country of corruption." Now remains the question, “whose fault is what happened to Greece?” Of course it's a matter of how a country manages its finances, and Greece certainly doesn't deserve a prize there. But on the other hand, which country would have made it, if by the moment of its creation is obliged to pay back loans of interests up to 90%? One would say, “then why did they get the loans?” If they hadn't got them, the revolution wouldn't succeed and no Greek state would ever exist, which is fine with me. After all, it doesn't matter whose fault it is. It matters who pays for it. Maybe you thought that, since we didn’t post anything new for so long, we had probably decided to let this blog die. Maybe we thought so too. But if you knew how things work in Greece, you would know that summer season is a time when everything slows down. Besides school vacation, business slows down, there’s no sports, the tv program slows down, even the news on the most “serious” tv networks prefer to talk about lighter subjects. So, why would this blog be an exception? One could say that this summer wouldn’t be as relaxed as every other. However, this summer proved that greek people give (for the time being) a higher priority to its relaxation than it does to its worry for the future – or should I say for the present? Of course tourist season always gives a boost to the economy and to the moral for 3-4 months. Now we have to face the rest of the 8-9 months before the next boost comes.
In the psychology of the economy, there’s been something moving lately. In this summer there have already been 2 major financial deals that show there is some interest taken in for investments in Greece. The first is about the cargo business of Piraeus port (the largest of Greece, second largest in the Mediterranean), which will from now on be ran by Cosco (the Chinese state shipping company) and the second is about a second port, an energy hub (Astakos) and a part of the old and deserted airport of Athens, where the Qatar Investment Company plans to build a hotel-casino complex. What’s interesting is that both of these moves come from outsider countries (given the eternal western dependency of Greece) that see Greece as their chance to break in the EU market. If these 2 moves turn out to be successful it will be a very positive development, as Greece (a member country of the EU and of the NATO) will get to have significant financial relations to countries with developed/developing economies that need Greece as much as Greece does. But this all will be seen – if ever - in the future. For now, there have been thousands of businesses closing down and a massive 120.000 new unemployed people since last January. Meanwhile, job listings are less and less and many people, especially young have already moved to northern EU countries (Germany, Sweden etc.). The government, except for trying to collect taxes (which is already proved by history that they can’t do successfully) is making an effort to put economic and social life in a primary order. This seems to be even harder than collecting taxes, as it was the same party that, back in the ‘80’s, created this monstrous state and spoiled the people by giving them money – money that had been borrowed. And now it’s the same party (some times even the very same persons) that blaim the people for the problems the country now faces. Here’s a very comprehensive article on Greece from this month’s Vanity Fair by Michael Lewis. (if you haven’t lived in Greece, this article will help you understand aspects of everyday life that I would need a lot of time and space to write about – and still you would think I’m exaggerating) P.S.: On my article of May 8th I was pointing: "Greece looks like a part of land where suddenly 12 million people are trapped in it and they have to find a way to set up a community from scratch. And each one of them has something different in mind, each one with their own definition of “victory”." Michael Lewis in his article says something that sounds similar: "The structure of the Greek economy is collectivist, but the country, in spirit, is the opposite of a collective. Its real structure is every man for himself." It's been already 1,5 month since the greek PM officially asked for an international bail-out. I had a rough picture in mind on how this program would work out, back then. I was guessing that the government would take a bunch of harsh measures at once (tax rises, cuts on salaries and pensions, layoffs in the public sector etc.) until the balance between the country's income and expenses evens up, enough for Greece to be able to borrow money at a reasonable rate. With this in mind, I was thinking that the people in Greece would suffer for a few months and that this would eventually bring social uprising, which could last for a few weeks – as was the case in December 2008 – and then things would get back to normal. But from what we've seen, this is not the way things work. It doesn't have to do with a single sad event – the killing of a boy from a cop / harsh measures being taken by a government. The greek government had taken some measures even before the activation of the bail-out program. These where the increase of the sales tax from 19% to 21% (in the last year - under the old administration - another increase took place, from 18% to 19%) and cuts in bonuses in the public sector. Meanwhile, there was too much optimism that the government could get a lot of money by hunting tax evasion. Since the EU-IMF program was activated, there have been another 2 groups of measures, a lot harder than the first ones. In short, these were: another increase of the sales tax by 2% (now it is 23%), cuts in salaries and pensions of the public sector, varying from 8-20% according to the wages, a new increase of some special taxes applying to liquor, tobacco products and gas varying from 10-20% and finally, an extra one-off taxation of all profitable businesses. Another measure that's worth analyzing is the following: The government had announced that due to the recession, it would give a 1000 euro “solidarity benefit” to people/families living under poverty level, in 2 parts of 500 euros. The first part has already been given to those entitled. In order to reduce the state's expenses, the minister of Finance announced that the second part will not be given to all those who got the first part, but only “targeted”. What does “targeted” mean? I can explain it in 2 steps: (1) The minister means that the first part was given – among others – to people who didn't really need it. This can mean 2 things: a) that the records of the government are inaccurate or - even worse – b) that the government gave this money to people who didn't really need it on purpose. Now, step (2): If the government confesses that its records are inaccurate, how are they going to tell who's in real need of the second part and who's not? Or, if they intentionally gave the money to people who didn't need it, shouldn't there be some kind of legal action against anyone responsible for this? Because when somebody is "below poverty line, this is objective.Can you say that somebody who's just 1 euro below poverty line, doesn't need the 500 euros? Still, the measures already taken are not final. The contract signed by the greek government, the EU and the IMF says that there will be a check of the income-expenses balance by an EU-IMF committee every trimester. If the balance is not satisfactory, there is a term saying that the greek government is obliged to take any extra measures needed so as to reach the target predicted. Today, as we are on the half of the first trimester, there's already a negative deflection of a few hundred million (!) euros. As a result of this - and of other – facts, the scenario of Greece defaulting is becoming all the more possible. The international media talk about this scenario a lot more than the greek media do. I don't know if this is enough to tell us more, but last December, when the greek media were denying the possibility of Greece to ask for help from the IMF, at the same time, most international media were almost sure that this would turn out to become true. Now, the international media also talk about the possibility of Greece leaving the euro, but this is a story for another article. Despite all that, people in Greece haven't yet reacted the way the most expected them to, given that Greece has a strong tradition in public uprising, demonstrations etc. It was last Saturday, at a demonstration organized by the 2 biggest workers' unions, less than 10.000 people gathered. How can we explain this? I think that people right now have mixed feelings: 1. They still manage to get along. Each family is trying to organize its life so as to get through all this the easiest way. 2. They don't have any real hope that their reaction will bring any solution. They understand that the country's situation is desperate, but there's no political party or person that convinces them to be more appropriate to handle this. 3. Society is boiling slow and at some point will erupt, but not having any clear demands. This will be just an instinctive reaction that will cause temporary chaos. 4. At the same time there is this feeling of complicity in what the country's going through now. - Wasn't it us who avoided to pay taxes? - Wasn't it us who were begging politicians and officials for a public job? - Wasn't it us who payed “something extra” at some public service in order to do our business faster/better/dirtier? and after all, - Wasn't it us who were voting for them for 35 years? These are some popular questions that you hear by people in the streets. Now, we can only wait and see which feeling(s) will be expressed first. The PM yesterday said in his speech at the parliament: “If we do not put the country in order, if we do not create a sense of justice, if there is no respect for the law, they will chase all of us away with stones, and rightly so." Looks like he's got the message... I apologise for not posting anything for so many days. Truth is that there were not any really important events in the meanwhile. Politicians are trying to convince the people that they are giving some big fight against the IMF people, in order to avoid some extra measures. The media are spending their time trying to find which party has been the most corrupt in the last 20 years. And the people is trying to adjust themselves in this new era, if they haven't already lost their jobs or seen their businesses closing down. Poul Tomsen is the head of the team that the IMF sent to Greece in order to run this bailout program. This is an interview of his that was published in Kathimerini newspaper. copyright: Al Jazeera 2010
Ο Riz Kahn στο Al Jazeera έχει καλεσμένους τον πρώην υπουργό Οικονομικών επί κυβέρνησης Σημίτη, Γιάννο Παπαντωνίου, τον οικονομολόγο Mark Weisbrot και τον Alexander Mirtchev, σύμβουλο σε διεθνή οικονομικά και επιχειρηματικά θέματα. / Riz Kahn in his show is hosting Yannos Papantoniou (ex-finance minister of Greece in the late '90's), economist Mark Weisbrot (co-director of the US-based Center for Economic and Policy Research, a non-partisan think-tank that promotes debate on important economic issues), and Alexander Mirtchev (the president of the Washington DC-based consultancy Krull Corporation which specialises in new economic trends and business strategies). This week has passed peacefully, with less and smaller demonstrations than last week. This can be up to 3 reasons: A. After the government passed the austerity measures, people got over the initial shock and is now looking to find a way to deal with the new situation. B. People temporarily withdrew from the streets just waiting for a spark to get back to the streets again. C. Workers' unions are mostly controlled by pro-government people, so they choose not to pull the strings but rather keep their reaction to a “symbolic” level. I also believe that the fact that 3 people died during a demonstration 10 days ago have caused a feeling of nervousness to the majority of people. Then, another issue is that we are just getting into tourist season (when 18% of the greek GDP is produced) so a lot of people are making an effort to put themselves and businesses together, hoping to get the best out of it. Meanwhile, hotel bookings have been very low compared to the last few years, both because of the instability of the country, as well as because of the economy being bad in most EU countries too. There have already been 17.000 hotel bookings canceled, just for hotels in Athens and we're only in the middle of May... Even still, for the first time since we got in this crisis there has been a little optimism. Not in the sense that “this will turn out to be good” but more likely “we'll finally make it, no matter what”. I don't know how rational this optimism seems to be, but we really need it. If there's one reason I tend to believe this, is that it's mostly said by older people who have been through hard times in the past. All of us, younger than 40-45, have mostly been grown up in a bubble, so all this seems like a mountain in our eyes. A picture which I think describes perfectly people's psychology at this point is something I saw when I went outside the bank where the 3 people died. There were lots of flowers, candles, notes, and people passing by, standing there for a while. One would think that when you are in such a place you probably leave a flower yourself, you think about stuff, most likely in silence. What was weird is that people were fighting! Not particularly about something that had to do with the 3 dead, but about politics, the demonstrations, what should be done now. It was really an awkward situation. Like being at a funeral and finding a reason to fight. I couldn't really follow what they were saying, there were 2-3 different fights going on at the same time. A good thing is that we have started talking to each other, having real conversations. I'm not talking about the fights here, I mean civilized conversations. In Greece we weren't used to this. Our dialogues seemed to be more like 2 parallel monologues. These days it's been quite usual to see people talking about the economy, the country's economy or their household's economy and not being dogmatic at all. They say their opinion but they are also listening to the other person with respect. It may not sound like such a big deal, but before that you could tell that people wanted to talk about stuff only with people with which they knew they would agree with. Despite all that, up to now it doesn't look like there is something going wrong in the real economy. I don't know how things were in other countries that were only a step before going bankrupt, but still it looks weird having bars and restaurants full of people, drinking and eating. A friend who's a bar tender told me today that his boss told him that when there's a crisis people tend to drink more. My question is, weren't we drinking a lot already? Something I heard and thought it puts it right: “Greece looked like a client in a restaurant who keeps ordering stuff so that the check will never come”. | Εδώ η ιστορία της ελληνικής ΔΝΤ-περιόδου γράφεται από τους ηττημένους. Σε πραγματικό χρόνο. Ακολουθήστε στο twitter: @deltanutau __________________________ Α real-time record of the IMF-era of Greece . Αρχείο / ArchivesOctober 2012
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