Papandreou and the Greek government accelerate Greece’s economic downfall
In my view, George Papandreou and the Greek government are doing completely the opposite from what other countries are doing these days to manage their sovereign debts.
Countries like the USA, UK, Japan and even Germany have accumulated large sovereign debts, with the UK around 250% of its GDP worse than Greece!
But they, and nearly all other countries in a similar situation, have a strategy, which is to avoid paying short-term debts. Because these days they can borrow money around 1.2% and if they don’t get this low interest rate then some go ahead and print money, thus avoiding the application of stringent austerity measures. What is also relevant in these countries is that the unemployment rates are high, going up and up, but business and companies are not closing down! Furthermore they do not sell their national assets to balance their economic budgets or pay off loans.
Their companies are making more and more profits! These countries are collecting more taxes and defer payments of debts to invest in large infrastructure projects, like in health, transportation and education. Here in Australia, all the four major banks are reporting their best quarterly profits ever!
Similarly the mining companies and large food chain stores are doing very well.
In Greece, more and more shops are shutting down, there is panic and uncertainty in the markets and the government is passing stringent laws without much concern for the public welfare and the long-term social and economic consequences. Something is going wrong here or the government is not telling the truth!
Unfortunately Greece is locked up now — by signing the EU-IMF memorandum it doesn?t have any short- or long-term control countermeasures to avert the complete downfall of Greece’s economy.
I worry that things from now on will develop from bad to worse!
Dr Louis Doukas PhD, MSc, FIEAust, CPEng
Retired: Professor in Engineering Systems Management, Director of Postgraduate Programs for Systems Engineering and Integrated Logistics Management at RMIT University, Melbourne, Australia
Modern cries from an ancient land
As an Australian/South African of Greek origin I have watched with interest the upheaval in Greece over the last year. The response in Greece has not been a surprise. My visit to Greece last June found the country in the midst of a screaming match. Whom do we blame? The IMF? ECB? CIA? Anyone but the Greeks themselves.
I have become accustomed, over the years, to the lament of my Greek friends who complain about the lack of opportunity, low-paid jobs, unemployment and corruption in Greece, while at the same time they enjoy the tavernas, European excursions, countless public holidays and the luxury of retiring at 50 on a pension fit for a king funded effectively by German, British and French taxpayers.
To my friends, the problem with Greece has always been those other corrupt, unethical, unprincipled Greeks who have their heads buried in the public trough. There is little mention of those extra rooms they have at the back of their house in Kaloni which they rent to tourists for 30 per night and have never declared for income tax purposes. What a life. The Greeks blame everyone but themselves. The convenience of voting into power successive governments that promised them benefits that everyone knew were unaffordable lays the blame with the Greek demoti. Now, when the chickens have come home to roost, the Greek takes to the street and goes on strike. The «others» are to blame, but ask anyone you know in Greece if he pays his legal taxes and the answer is no. From the cab driver who confessed that in 15 years he had never paid tax to my relative lawyer who explained how he has never declared to the tax office more than 20% of his earning and then «negotiated» the tax liability, Greece displays a level of civic responsibility that would make Nero look good.
The problem is that the Greek state has set the benchmark for its own citizens. The shameless practice of ripping off foreign Greeks has been standard practice for years. Whilst living in Africa, I watched my parents work for some 18 hours a day, seven days a week, to provide their kids with a better education and to send money back to Greece and invest in property so that there was somewhere to go if we ever faced the same fate that befell our relatives in Egypt, Kenya and the Congo. Imagine their devastation when they discovered that the Greek state imposed rent control to protect the local Greek at the expense of their rich foreign brothers. Sub-economic returns for a lifetime, thank you very much and we will always be brothers.
The joke goes further. Find me one Greek who has lived abroad and has not had family property in Greece fleeced by his Greek relatives. The stories are so funny that I think I will write a book exposing the countless ways you can lose your share of ancestral lands to relatives. These include relatives selling land they don’t own and pocketing the profits and moving land boundaries to their benefit. It?s hilarious how the local villagers suddenly develop amnesia when it comes to your boundaries but know exactly how many centimeters everyone else’s property is. Civic fraud at every turn, and a court system that is designed to ensure that the local always wins because a legal process that is as protracted as that in Greece will always disadvantage the foreign Greek.
The message for the Greeks is clear. Get on with it. However, a society that clearly lacks the fortitude, character and vision of the ancestors under whose ancient ruins they now live, will always remain a debt-ridden Third World economy tacked on to the bottom of Europe
Re: Taking secular values at face value (April 18, 2011)
If I share Mr Harry van Versendaal’s view that the ban just voted in France is a good thing, it would be better for the reputation of the famous newspaper that is Kathimerini to encourage its journalists and writing guests to stick to a minimum of informed honesty when delivering opinion pieces. This piece, in particular, suffers from a distinctive lack of information: To claim that Nicolas Sarkozy’s government strictly adheres to the secular philosophy on which France built itself after the 1789 revolution is, well, comical at best and ridiculous at worst.
Nicolas Sarkozy is the only French president to have played the game of bending his knee before the Catholic Church’s pope. He’s the only French president to have publicly said that priests are way better teachers than the national education’s teachers. He’s also the only French president who has again and again reaffirmed the Christian roots of Europe and France, and clearly played the Catholics against the Muslims.
I hold no sympathy for Islam, on the contrary. But on the subject of French secularity, Nicolas Sarkozy is anything but an example of sticking to those principles. He is the exact opposite. To claim otherwise and write it in an opinion piece demeans the newspaper which allows such a publication, and betrays either a lack of intellectual honesty on the part of the author, or a lack of knowledge of the situation he writes about — which is, in my opinion, also a fault.
Editor replies: As the article you are referring to mentions: ?even if it passed the ban for the wrong reasons — which is debatable — Sarkozy?s party may still have done the right thing.?
Birbili writes to managers after investigation claims financing was illegal
Here’s a wild and crazy idea. How about firing the managers who gave this money to the unionists? This is a criminal matter. Let the courts and the prosecutor worry about this aspect of the issue.
However, telling a few incompetent and corrupt managers and executives who spent millions of euros improperly that their services are no longer required is certainly within the government’s purview — now. It doesn’t matter whether any laws were broken. It’s horrendous management, and worthy of sacking on its own.
I know, I know. It’s outlandish. Crazy. Far-fetched. Completely out of character for the Greek state apparatus. But who knows, it just might work and start a trend.
Stay in Greece and do what?
Stay in Greece and do what? Achieve what? Become a forced partner of the ”Greek State”?
There will surely be hundreds of applications from Greeks, both local and diaspora who emigrated here several years ago hoping to have made a life here who will gladly apply to leave.
We all hear it time and again, bureaucracy and corruption. Little do our foreign partners understand just how complicated and corrupt our government bureaucracy has become. We have the state and its employees now becoming an unbearable obstacle to growth and job creation. No sane individual could possible want to invest in Greece after experiencing the complexities and bureaucracy one faces here on a grinding daily basis.
It has effectively become cheaper and less stressful to close one’s business here and just do something else, anything! Being a self-employed businessman in Greece is becoming an enemy of the state. One becomes just another source to tap with serious taxes (stealth too) in keeping a massively corrupt civil service afloat which in turn guarantees the political parties their votes. We see Genop of PPC and their threats etc… submarines, land swaps, etc etc etc. Greece burns and the politicians fiddle…
It is time the EU partners stepped in and took control. Things will go from bad to worse, in turn having a negative effect on the EU’s reputation.
Australia was a wonderful vist several years ago, and personally a serious thought as a destination for investment.
With hindisght, an investment in Australia would have been far wiser, cheaper, less complex and far less stressful than anything done here.
The time may have come for change. Skills, investments and experience which are not respected and appreciated here, will surely be respected in Australia. Greece’s loss will be Australia’s gain.
The rivers in the wetlands discharge untreated sewerage, agricultural fertilizers and pesticides of all descriptions and most likely industrial waste as well.
Go for a drive in the catchment area and see what happens. As most Greek farmers can?t read, they think a little bit more pesticide is better. Every village and town now pumps its sewerage to the nearest ravine, creek or river totally untreated to end up in Thessaloniki.
The wetlands are a toxic soup, it?s suprising birds survive there.
Poor Macedonia, in less than one hundred years, its forests are gone, its rivers polluted and the gushing springs have disappeared to grow cotton for the needs of Northern Europe.
If Macedonia had the water of 60 years ago, more money would be made selling water than all the money from cotton sales, without working.
The worst part is that the very soils of Macedonia have been degraded from stupid agricultural practices.
Nobody loves Macedonia, and nobody in Macedonia loves their children enough to leave them the inhertance of clean land.
The Anglo Australian Government would not accept Greek immigrants at this time.
The weekly ships stopped arriving from Greece in 1972 after Greek workers rioted and beat up corrupt union officials and managers of a company for treating them like slaves. Within weeks they started bringing in Turks instead.
The Australian Government?s policy of multiculturalism is in fact slow assimilation. They know that within three generations every group would melt into the soup. They keep changing the countries where non-British migrants are coming from so that the culture and language groups are not renewed.
Sixty percent of uneducated Greeks and Chinese maintain their language into the third generation. The educated do better, of course. Intermarriage is the main curse to maintaining a culture and language. Mixed marriages amongst the uneducated end up speaking only one language, English.
Australia has a large immigrant intake every year, but they are mostly British.
The have bought in Germans, Balts, Italians, «white Greeks,» Turks, Vietnamese, Chinese and Indians. Recently sixty-thousand educated professional Iranians. Iraqis and Afghan refugees, and Jews from Israel, South Africa and the USA are also coming. The latest migrants will come from Northwestern India, mainly of Aryan stock and well educated in English, who can quickly fit into the economy.
Greece would be wise to keep its educated work force in Greece, even if they have to pay them to stay, as Greece has a lack of a productive work force. Australia will only take the best.
I sometimes think that if all these very capable young Greeks in Australia and USA were in Greece, would Greece be different?
The strange thing is the migrants from Greece are mostly Greeks whose great-grandparents were Greek, not the «Greeks» whose grandparents spoke only languages other than Greek.
Maybe that is the problem in Greece today?
The Greek economy
What Dr Doukas did not say is that these other countries in serious economic times stimulate the economy in a effort to increase business, and decrease unemployment, thus increasing tax revenue. Initally this increases debt. But what is worse is the supposed brilliant minds of the ECB, EU and IMF don’t bother to assist Greece in any way other than to loan and demand cost reductions. They too know that in times like these, austerity is great but it must be coupled with stimulus measures to increase revenue as they use this approach too. The big problem is that the agreement our PM signed was not negotiated in a manner to allow for expenditures to stimulate the economy.
Now tell me, if you cut wages 10% to 15% and you increase taxes 10%, in effect you have just increased the cost of living by 25%. The result is obvious, people spend less and so businesses suffer more, which leads to more unemployment and less tax revenue. The term is ?death spiral.?
Unfortunately, Dr Doukas’ concerns are very real, and unless something changes very quickly he will see it?s forecast become reality.
Cut the budget too
I strongly disagree with the minister?s remark; as Greece faces its worst economic crisis in decades, even this minister has to take responsibility about the future of young people who are desperately looking for a job. Cut the expenses of the military by at least 25%. I fully agree with the advice of the EU and IMF.
Re: Renee Pappas on metro vandals
In reply to Renee Pappas on why the metro vandals were not caught or even an effort made to find out who they were. I can only think of one answer. The culprits were probably Greek. It seems that when Greeks commit acts of vandalism, the country as a whole believes this to be a just cause (like the ?I Don?t Pay? movement), but let a few Pakistani hunger strikers try to do the same thing at the University, which supposedly has asylum, and the Greeks are all over it with their contempt, yelling at the authorities to do something!
Double standards! Thugs are thugs, whether Greek or foreign…
An open letter to the Prime Minister
Dear Mr PM
Saving money is not the sole solution to the economic problems that have been inherent within Ellada for far too many decades.
While that is important, you must also look harder at how to create new money, how to attract wealth back into Ellada — and I do not mean by selling every industry to the Chinese or others whose interests are not for the betterment of Ellada.
Rather, tourism is worth far less than the 17% it used to inject into the economy. Well, with effort and rethinking it could easily become 25% and more. But that would take a complete re-examination of the tourism industry and how to make it better from the ground up.
That would mean tackling corrupt and lazy tourist operators, lifting service standards considerably and forcing people to stop treating tourists as money bags waiting to be emptied.
Then there is the fact that no nation that I have ever visited has natural beauty like Ellada. Yet Hollywood travels to New Zealand for movie after movie, or to Melbourne, Australia, where I live with my Hellenic family.
Why aren’t you promoting the greatest waters in the world, the loveliest seas, the cleanest mountain springs, the most majestic mountain ranges… to Hollywood?
My mother-in-law’s village of Vresthena in Sparta. My father’s village of Tsamantas in Epirus. Views that are simply stunning and which Hollywood could make incredible movies out of.
There is so much to be positive about Ellada. So much to be proud of. So much that I do boast about to so many.
And there must be other ways of bringing money back into Ellada that would also increase interest, positive interest, from other nations and from millions and millions of people around the globe.
Please, Mr PM, start thinking about the future of Ellada so that I still have a ?patrida.?
Re: Greece, land of pain and joy
I could not agree more with this article. Corruption might be contagious but let us not judge all of Greece for the actions of dishonest politicians, professionals or other groups that brought down the land and the people that have given us so much with their character, their culture, their land.
The utopia of coming into the euro family also contributed to this downfall.
Greece has more than one Nikos Papazoglou. The average hardworking men and women of Greece are an integral part of his soul.
May he rest in peace and may his spirit continue to live in the souls of all Greeks.
As a non-Greek, I can be perhaps a little bit more impartial in judging, and, by doing so, I can reiterate that nothing will change my opinion about this beloved land and people that I care for so much.
Greece will prevail. God bless you guys!
Jean Paul Schein
New York City
New terrorist maniacs
Claiming the name of a dead little boy is just another act of evil by terrorists who have plagued Greece as long as the communists with whom they sleep. When will the police be charged with finding these criminals and killing them all? What about the scum that murdered that pregnant woman at the bank? They are NOT Greek but enemies of Greece and must be rooted out like an unwanted viral infection.
Re:Aussie blogger advises ?Souvlaki for the Soul?
“Cinnamon to mask the taste of poor meat in pastitsio”
In her piece, Lina Giannarou claims Athenian tourist traps use «cinnamon to mask the taste of poor meat in pastitsio.» My family is from Zakynthos in southern Greece, and we have historically used cinnamon in a lot of our red sauces because it is a beautiful, fragrant spice (typical in the southern regions). I can say the same for nutmeg, which I like to use in bechamel sauce… so, despite the fact that I agree that most of the eateries for tourists don’t give a damn about food quality, using those beautiful spices in Greek dishes is not a bad thing, but typical in regional cooking, and I want people to know that if they are trying to learn something about Greek food. Kali orexsi!
Thank you for shedding light on the Greek debate on debt restructuring (?Voluntary maturity extension plan may hurt liquidity of local credit institutions,? by Dimitris Kontogiannis, April 26). There is a lot of discussion about this in the European media even though there appears to be no common understanding even as to what is meant by debt restructuring.
In Germany and elsewhere, debt restructuring is seen as an option which is completely out of the hands of the debtor, in this case the Greek government. In business law, debt restructuring is just another form of bankruptcy. Reducing debt by changing Greek law sounds like a truly wild concept, especially taking into account that the same method is of course available to all jurisdictions. It is something truly different than the proposals for voluntary agreements between creditors that many think will take us forward.
The terrible fact is that that the democratically elected governments of Europe play a minor role in this game. In your article you mention Finland, where the majority of the people have put into question the undemocratic government by bankers and bureaucrats — we are not against Europe, as you may have been told. However, another terrible fact is that the Finnish government is just about as dependent on the Central European banks as the Greek government, no one even mentioned the possibility of ever paying back any of the Finnish sovereign debt during the recent Finnish election campaign. The German banks and industry run the show, but even in Germany the legality of ESM has been challenged.
We may see the house of cards fall down sooner rather than later.
Re: Who’s running the show? (Alexis Papachelas, April 26)
At present the answer to this question is rather simple: troika! I was very interested in a recent opinion poll in which the majority’s preferred option for running Greece at present was technocrats. Of course this is not practical in a democratic country but it does demonstrate the realisation of the Greek populace that our present set of politicians are not up to the task. This is not surprising since only a few of the present set have been educated in management/economics. In this time of crises it is a necessary and sufficient condition of holding a ministerial portfolio to have either run a profitable business or have studied management/economics. PM Papandreou’s priority at present is to privatise as many public assets as is economically prudent and politically possible. His second priority should be to introduce radical trade union reforms such as pre-strike ballots and the public disclosure of all trade union expenditure. His third priority must be a root-and-branch reform of university education, not secondary education. The Greek university system is dysfunctional at best and is a block to the future development of Greek business. At least one third of all university trustees/governors should be from the private business sector — and the position of rector must be advertised in the international academic press. Greek universities at present are at the bottom of the world university leagues. Who will invest in Greece with such a poor academic record? In order to emerge from its current economic and fiscal crises, Greece needs the best leaders and managers, qua technocrats, to run the show. Where are they today? Certainly not in the local universities.
Dr David Green