My view on the Greek debt crisis

 

A presidential guard watching clashes between police and protesters outside the Greek parliament.

 

 

 

With the Greek debt crisis still dominating the news, I wonder if you know that Greek public debt was only 20% of GDP in the early 80’s. It only took 30 years for Greek politicians to increase it to 120% of GDP in 2009 when the crisis became public knowledge not only to the Eurozone, but to the Greek people.

Fast forward two years, and with the “help” of the Eurozone, debt to GDP has increased by another 40% to a staggering 160%.

Default seems inevitable. The eye-watering austerity measures enforced by the Troika have lead the country deeper into recession. The Greek economy has shrank by 20% in four years, and this is the true reason why the Troika’s budgetary goals have not been met, followed closely of course, by an inability of spineless Greek politicians to implement any reforms.

Greeks have endured a constant stream of tax increases and repeated salary cuts, while watching half of their young labour force unemployed. Suicides have trebled, homelessness has multiplied and the Greek church recently announced they are feeding at least 250,000 daily in Athens. Now, Greeks are told that this notorious second bailout will help reduce the same ratio back to 120% by 2020.

Surely, if this level of debt is sustainable, then why did Greece need the first bailout in 2009, when debt to GDP was as 120%?

The debt crisis, has affected everyone in Greece. My brother, a computer analyst, and the father of two young children was laid-off from his job in IT in November. He hadn’t been paid for five months. He tells me there is no hope of finding another job, within or out of his profession.

When I speak to my 82 year old grandmother, still living in Athens, she tells me she’s cold. It is the second winter she has not had central heating because nobody in the apartment building could afford heating oil for the joint boiler last year. This year, the apartment building is empty. She survived for years on the income she received from renting four small apartments, but the tenants didn’t pay for months, then left in the middle of the night, leaving behind unpaid bills. The one tenant that is left, has also not paid her rent for months.

My grandmother says, “I feel sorry for her, she’s got nothing, and she’s paid her rent on time for years. I can’t just kick her out into the streets.”

Thankfully, more and more Greeks are thinking like her. On the 4th of February, potato growers in the north of the country, offered over ten tons of potatoes to residents of Thessaloniki, distributed free to growing queues. They were protesting against retailers importing cheaper potatoes from Egypt, when more than 70% of Greek produce went unsold, but they also wanted to help amidst the chaos of the crisis.

A week before that, a farmers market in Syntagma Square handed out 30 tons worth of vegetables to passing Athenians, free.

Ordinary people, are seen taking whatever clothes and blankets they can spare to the growing homeless.

An atmosphere of solidarity and camaraderie is spreading. Concepts that have always characterised Greek society in times of great need. And this is certainly one such time.

The austerity measures have failed. Europe is not bailing Greece out, it is bailing out their creditors.

Another fact you may not be aware of, is that today, it is exactly ten years since the Euro was circulated in Greece for the first time. I wonder whether this year will create a new anniversary. An anniversary of Greece returning to an old currency. If not the Drachma, then the Phoenix, the very first currency of the modern Greek state in 1928, when free from the shackles of the Ottoman empire Greeks needed a symbol of re-birth and re-generation. Like they also do today.

The Greeks may default, but they are built to survive. And an exit is always an entrance somewhere else.

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One Response to My view on the Greek debt crisis

  1. Mick Harwood says:

    Although protectionism practiced by a large country/state would probably be catastrophic, I believe that Greece would be more than entitled to introduce a “buy Greek” policy.

    I dont think you will get your “government” to endorse it officially, but if their is a groundswell of public opinion, then I think it would be the start of Greek people resolving their countries problems.

    It would be dangerous, but your country needs “alternative” leadership.

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