Are high labor costs the main reason behind Greece?s anemic competitiveness? Most entrepreneurs will promptly respond that this is not the case. (I am not referring here to those operating in sectors flooded with clandestine labor who are not bothered by things like the 13th and 14th salaries or the minimum wage.) Meanwhile, the efforts of several labor representatives to appear on the side of the worker sound extremely hypocritical when everyone knows what really goes on within the unions.
Serious businesspeople deem that the root of the problem lies elsewhere. The policy of automatic pay rises for having worked a certain number of years, for example, is a very big problem which has injected a public servant mentality into private sector employees. Reactionary attitudes among union representatives who refuse to grasp the seriousness of the situation also impacts negatively on jobs. The standoff between unions and employers at the Halyvourgia steel plant is reminiscent of past disasters that accelerated the country?s deindustrialization.
The main reasons behind Greece?s faltering competitiveness have to do with the way in which Greek politicians, the state and several fanatical pundits are fighting against entrepreneurship, doing their best to stop any investment. A Greek multinational, to take one example, decided to make the exact same investment in a series of states. The project was successfully completed in every other country (including Nigeria) but Greece. Who was to blame for this? A state which is unfriendly to business, the archaeological service and politicians who are reluctant to make a decision for fear of the prosecutor or some bad publicity.
Greeks are hardworking and creative. In the port of Piraeus, productivity soared once China?s investment managed to escape the clutches of strikes and hardline unionists. Similarly, removing such obstacles would release the potential of the Greek economy. Unfortunately, vested interests and a party-dominated state have not allowed this to happen.
We shouldn?t allow the dogmatism of several troika officials to lead to further across-the-board cuts in the private sector. At the end of the day, private sector workers have felt the consequences of the crisis to the full and lived under the threat of unemployment, and they work hard without expecting any political favors. Blind dogmatism, justified as it may be because of the incompetence and unreliability of Greece?s political system, will lead us nowhere. We need structural reforms that will do away with the forces which hold the productive Greek hostage.