Concealed crisis

Over the past five years, Kathimerini’s editorial page has repeatedly emphasized the fact that Greece is in a state of hidden fiscal crisis and that in perpetuating the myth of a «strong economy» the government is merely deluding itself. Kathimerini has backed this claim with a plethora of evidence – both official and unofficial – coupled with the plain observation that the near-zero deficits are contradicted by the rise in public debt and the expenditure on interest payments. This contradiction points to the existence of secret spending, non-recorded deficits and to problematic fiscal management that cannot be kept in the dark forever. It is worth noting that Kathimerini’s reports on various aspects of this veiled fiscal problem have met with ire and unbelievable charges on the part of of the government. The European Union’s fall report on the state of the Greek economy which was made public on Wednesday was out of line with the government’s figures. The Commission forecast that Greece’s public deficit next year will be double the 1.2 percent of GDP predicted by the government. These predictions were supplemented with remarks by EU Economics Commissioner Pedro Solbes who expressed serious concerns over rocketing deficits in Europe. The Brussels report jolted the government and its economic experts – faced with a general election in a few months. True to form, the government once again avoided presenting the real picture to the public. Both Prime Minister Costas Simitis and National Economy and Finance Minister Nikos Christodoulakis disputed the European predictions and sought to defend the virtual reality they have built by means of double bookkeeping and hidden expenditures. But their efforts are in vain. People in the know are aware of the crisis. The fiscal excesses are blatantly reflected in the pharaonic projects, the waste on Olympics-related venues and the draft 2004 budget where the government has clearly – and somewhat naively – tried to underestimate expenditures. Everyone – from the ministers and senior members of the administration to the last citizen – knows that the conclusion of the Games will be followed by a full disclosure of the fiscal crisis and that its repercussions will be felt by all of society. Hiding the problem is a scandal. The government must tell the people the whole truth about Greece’s sorry fiscal situation and brace them for the troubles to come. The Socialist administration – and the conservative opposition – must put the issue on the pre-election agenda and propose measures to tackle it. This will perhaps be Simitis’s sole contribution to the nation at present.