This was an excellent article and so very sad that the majority of Greeks really do not understand the situation. This is hardly surprising with the lack of support for the measures from opposing parties and even from some in the Government. While Greeks are crying to stay in the Euro, at the same time they don?t want the measures, which frankly only 10 percent of them even understand. I agree the Government is not explaining the situation plain enough. Firstly, to explain just what would happen if we returned to the Drachma, which would be a disaster, especially to the poorer members of our society. Secondly to explain that the representatives from the EU and IMF will be here as technical experts to modernise our public system, which is a fiasco. Many of us have tried to explain that it isn?t simply the pensions, high wages, overemployment of this sector but the corruption which has destroyed our economy. However, if they are going to make examples of citizens with black money accounts in Switzerland and of claiming pensions for deceased family members, then they must make an example of corrupt politicians.
For sure, this is our last chance. The EU isn?t taking any more chances with Greece, the Euro will be protected so that if we default now, we will be ruined.
Isn?t it rather pathetic that with such a small population living in the most beautiful European country with such heritage and climate for tourism and so many of us still trying to make this work, that we have to see our politicians behaving so irresponsibly?
Concerning managing the political situation in Greece, this a master move. But it?s a dangerous one. Because when Greece says ?No? concerning Europe, Greece at least has to prepare itself for a mental default: First their politicians and now the people of Greece don?t want to be confronted with the responsibility of the state of affairs their country is in right now. Europe just will close the door.
Hans van der Schaaf
Plebiscite — a wonderful negotiating tool
EU elites must be having a bad morning today after hearing about Mr. Papandreou?s bombshell of a plebiscite. No need to feel pity for them! Perhaps that will motivate them to start thinking what ?real help? for Greece would be instead of only focusing on what help for banks is.
Obviously, to actually hold a plebiscite is nonsense. What would it achieve? If the result were ?yes?, there would still be close to 50% of the people vehemently opposed to the government?s plan. And if it were ?no?, it would be a fast route to poverty and perhaps even anarchy. Apart from the fact that one cannot even envisage what question the voters should be asked.
However, the threat of a plebiscite which would bring down the stage of a carefully crafted bank rescue plan for which Greece would be making available her balance sheet is an excellent negotiating tool. Congratulations on that, Mr. Prime Minister!
The big shortfall of all measures to date is that the Greek government is being forced to radically reduce its expenditures without, at the same time, implementing measures to stimulate growth in the economy. The expense cutting on the part of the public sector cannot be avoided. When the public sector shrinks, the rest of the economy must grow in order to keep the overall result bearable for the population.
So the stage is set for a wonderful new approach: the EU has become accustomed to throwing around 3-digit billion euro numbers in connection with what they call ?help for Greece?. With those dimensions, it would truly be ?chickenfeed? to throw in, say, another 10 billion euros for growth projects in the Greek economy. While the 3-digit billion numbers don?t do Greece any good, 10 billion euros for the Greek economy, if invested well, would produce wonders.
The question would be how that 10 billion euros are best spent in such a way that one gets ?most bang for the buck?; i. e. the maximum number of new jobs and new income for Greeks out of productive activities. If the monies are handled by public entities (be that the EU or the Greek government), the risk is that they may to a large degree end up in the wrong pockets. The ultimate test of what a good investment is is whether or not a private investor would also make it voluntarily.
The EU should consider the following: make the 10 billion euros available to serious investors (inside and outside of Greece) who have convincing investment plans for value-generating new investments in Greece which create jobs and income for Greeks (and income taxes for the Greek government).
And when the EU has finally decided to help the Greek economy, the plebiscite can be called off.
To me it looks like Papandreou is passing the buck onto the Greek people so he can blame them for the forthcoming default. Of course they will vote against the stupid heavy-handed austerity measures. When it?s all over, Greece will have to stand tall and accept that changes will still have to be implemented. One thing that really annoys me is the passing of laws that are not enforced.
Chin up Ellada.
For those of us who understand the political, economical and societal situation in Greece, Europe and the world in general, you have been a model of a president for more than two years now (since you took office… whatever you might call the previous PM).
You have fought against all odds in your own country, in Europe, in the USA and even in China for one common goal; a positive European future for an almost obsolete nation. I personally salute your stamina and perseverance to succeed… and you accomplished it a few days ago by using and swaying every single tool on the planet.
You have successfully sacrificed your party, PASOK, and yourself in the eyes of our people (Greeks) for the common good. No other president has done this for Greece in the past 40 years. Congratulations, you are a living hero… even the Germans respect you!
Now please explain to us why you had to go and ruin everything last night? Why did you come up with the referendum? You know very well that the average Greek is easily swayed by propaganda and political misrepresentation. You should have remained sacrificed like you did so far and save your country from itself!
God bless from now on…
Greek reaction to crisis — a PR problem indeed
Although I understand, and have sympathy for the fact that many Greeks feel threatened by the economic cutbacks that the current government has agreed with the EU, I do believe that the (general) Greek popular reaction to these measures is shortsighted, unrealistic and counterproductive.
In essence, Greece has had a very rough wake-up call. One telling them that its current society and politics are unsustainable. Something that would have happened sooner or later anyway. The astonishing examples I?ve read over the past few months, of the ways in which the Greeks evade taxes, the way the Greek government fails to function and the favoritism that is widespread, are all proof of a society going down a dead-end road. In today?s global economy, with its global competition, this is a way of living any country just cannot afford.
The only way Greece will ever recover is if it fundamentally changes its society and attitude to taxation and if it adopts a Northern European style of governmental and fiscal responsibility.
The other European countries are forced to help out Greece because the Greek mess may spread to other weak Southern European countries, further threatening the Euro and the Euro zone. These countries are therefore living up to their responsibility as Euro partners.
At the same time it would suit the Greeks to adopt a more humble, thankful and productive attitude as well as displaying an understanding that the ways of the past do not work. Protesting against the economic cutbacks is not only counterproductive but also weakens the willingness of Northern Europeans to help them out. Mind that Northern Europeans already have a difficult time understanding why they have to use their tax money to ?bail out? a country that has so clearly messed up, has lied to become part of the Euro and subsequently has lied about the state of its government finances, which caused the current problems.
If it ever comes to a Greek referendum, therefore, it would be in Greece?s best interest to overwhelmingly vote ?yes? and clearly thank the rest of the EU for helping them out. The alternative, a hard default and subsequent exit from the Euro zone, will be much worse.
Please address your quest towards those that decide and/or can have an impact on EU decision making, not as a Greek but as a German and European citizen!
Interesting analysis about the ineffectiveness and the delays in the EU decision-making bodies, and other international stakeholders. Which increase Greece?s debt burden. Yet one should add two important parametres before going into the recommendations area! First that the problems with the Greek economy?s competitiveness and the related structural reforms of the public sector are much more critical to both the deficit and the summative deficit and the debt as well as to the profile of Greece and its economic potential as considered by the financial markets.
Second, the similarities with Germany? s support-to-unification policies, subsidised by the former DDR, have but marginal similarities, exhausted in the differences between the welfare status of the two originally separate states. On that occasion, the constituencies where the political elite were accountable to, mainly the DDR citizens (taxpayers and voters) were almost 100% positive to this policy orientation and the unification agenda. Please compare with the commitment of other EU members? societies towards the support to be offered to the Greeks.
Bottom line, it is really helpful to address those issues — policy questions — in your article, to the German and EU policymakers not as if you were Greek, but on the contrary as a German and European citizen. That would help, both the Greeks to make their case transparent and the other Europeans, the Germans included, to understand the gravity and the relevance of the Greek case to the European agenda.
I?m writing from Berlin, Germany. Though I don?t know much about the tactics of Greek politicians, it is only right that the Greek people should decide on such an important issue.
It seems better to vote on a clear issue than to give the opposition the benefit of the doubt in general elections.
Never mind the panic of the marketplace — let the people decide. They have to shoulder the burden, not international financial interests that want to use the present situation to privatise important Greek assets.
On the other hand, a fifty per cent relief of debt seems a considerable success for any national government.
A message to the Greek leaders: Why not ask the Greek citizens in a referendum if those who are responsible for the financial crisis in Greece should be brought to court?
I wonder, if it was totally up to the Greeks, what would their proposed solution be? Total debt forgiveness plus a massive cash injection? Right.
I live in the UK, and our PM said we can?t decide our future! I wish we had a PM with the same courage as yours. Greeks should all stand tall, the EU does not have the right to impose its dictatorial ways on you.
If it means leaving the Euro, then I would say so be it, leave the EU then so be it. Greece is the home of democracy, I think Merkel and Sarkozy need a lesson in history. I am certain that Greece will prevail, it is a fantastic country, full of history with a passionate and proud population, they deserve better than a handout from Germany and France.
The prime minister being called on the carpet in Cannes
?Caught unawares by his high-risk gamble, the leaders of France and Germany summoned Papandreou to crisis talks in Cannes on Wednesday to push for a quick implementation of Greece?s new bailout deal ahead of a summit of the G20 major world economies.? (Ekathimerini)
And what if the Prime Minister said that he was busy right now explaining to his parliament the reasons for the plebiscite? Does the Prime Minister of Greece have to jump at every whim of EU elites?
Mr. Papandreou?s bombshell, for reasons right or wrong, has finally brought to the surface the hypocrisy which has governed negotiations over the last 2-3 years. The hypocrisy of EU elites presenting themselves as the saviors of Greece when in actual fact they have so far used the balance sheet of Greece to bail out their banks.
The EU elites have overlooked one small detail which John Maynard Keynes allegedly discovered: ?When you owe the bank little money, you have to be nervous. When you owe the banks/governments 350 billion euros, they have to be nervous?.
Obviously, it can never come to a plebiscite, but the EU elites will now have to pay a price for that. That price is easy to define: with all the 3-digit billion euro numbers which they have thrown around so far under the pretext of ?helping Greece?, they should now make available an additional, say, 10 billion euros (comparatively ?chickenfeed?) for new growth projects in the economy. McKinsey made a study how 500,000 new jobs could be created over the next 10 years. Over 100 specific projects were listed.
Take the first 10 of these projects for next year and create 50,000 new jobs in 2012. That will be a message to Greeks that they can, indeed, have a positive future perspective!
And then you can call off the plebiscite.
Greece faces meltdown after bailout vote bombshell
George Papandreou and his PASOK political party seem to have had enough of protests and strikes by disaffected Greek unions and public employees, and enough accusations and demands by the opposition New Democracy party for early elections now that PASOK is on its knees! He decided, therefore, to throw the ?hot potato? of the Greek debt crisis to the protesters; let them reject it; then have early elections; let New Democracy fulfill its wish to form a government; unload the debt crisis on them, and then he can go on the attack in the parliament on any plan by the New Democracy party that does not satisfy the global financial markets and repair the Greek credit rating. It will be his sweet revenge on the Greeks protesters and the New Democracy party. His decision for a referendum on the debt issue, therefore, is actually a challenge and a warning: ?Be careful what you wish; you may have it!?
Papandreou has taken enough drubbing, and he decided to throw a ?monkey wrench? to both the opposing Greeks and the opposition party, and let them do the mechanical work to fix the foreign debt burden without paying it! The Greeks see themselves as victims of usury by foreign banks and lenders that should get nothing back because they have been exploiting smaller and poorer nations all along! Now Papandreou is turning the tables on them by asking them to cast their vote on that thinking and bear the blame and the consequences. It is a smart move that would give a lot of mental anxiety to the Greeks and force them into a sensory overload of ?how to vote in a way that will allow them to eat their cake and have it too? without the contagion of an incurable financial indigestion that they will come to regret!