I am often asked to offer my opinion about Greece, or to be precise, the current Greek drama. That's probably due to the fact that I am Greek, but also perhaps because I’m known to be quite vocal and opinionated. I come from a family that can be described as predominantly leftwing. My granddad was active (at times, not so active as he was in prison or exiled) during World War II and the civil war. My father came back to Greece in 1973 as the junta of the colonels was collapsing, returning from what was then called DDR German Democratic Republic to engage in the politics of the newborn Greek republic. He did so as a member of the central committee of a newly formed party, “KKE εσ.” which was communist but not pro-Soviet or Stalinist.
Despite such heritage and what seems to be a "national trait" -the willingness to engage in debates and to argue- I have been very reluctant to talk about what's going on in Greece this time round, both while here and in Athens. This, to a large extent, is due to the gravity of the situation. An entire generation of Greeks has been reduced to a highly educated, working poor one. Cancer sufferers are being left untreated due to lack of medicine. The state owes over seven billion euros to businesses, tens of thousands of which have gone bankrupt. The economy has shrunk by almost 25% and as a result the debt as a proportion of the GDP has actually ballooned. Unemployment has now exceeded 25%; one in two young Greeks are out of work.
I suspect that another reason I am reluctant to engage in any conversation is due to the other trait of modern Greece, the extreme polarisation of the "discourse". This has been a cute quality of the Greeks, at times even funny and exploited in a playful way by Hollywood, but it is now showing its ugly side. Not quite the ugliness that led to 1946
, but dangerously close. On this I will expand shortly.
It is partly for those reasons that I decided to translate a piece by George Soros
into Greek. I certainly don't share many of his views but I do think that in "The Tragedy of the European Union and How to Resolve It" Soros sees the crisis for what it is: a crisis of capitalism. For a number of reasons this dimension has long been lost in Greece. Among the chief reasons is of course, the misery inflicted upon the vast majority of Greeks, which has left them with very little time or desire to analyse the situation and look at the wider context.
However, another reason relates to the failure of the modern Greek state, and the bankrupt political elite that has been ruling the country since the formation of the modern nation state. Because people like my parents did set out to modernise the state and its institutions and because –it is probably fair to say that- very little was achieved, many of them have developed what I call the post-dictatorship Greek moderniser's guilt. Interestingly Soros uses a German term, Schuld, which means both guilt and debt to describe the German attitude towards debt and the indebted countries, but it seems to me that it describes equally well the feelings of many people who tried to seize the moment after the collapse of the dictatorship, only to be defeated by the system. That is, they have come to accept that all is our fault, as if everything else is swell in the early 21st century, including the EU and capitalism. [shall I mention the Nobel prize here?]
By now, the sequence of events should be familiar to most. Around the middle of 2010 the Greek government led by Georgios Papandreou -son of the late Andreas Papandreou, serial prime minister of Greece- revealed that the deficit figures declared by the previous government were false. According to Soros, the markets suddenly realised that what was until then considered a riskless investment [Soros: ], state bonds were in fact in danger of default. The problematic nature of the common currency now became crystal clear. This was a currency with a central bank but no treasury. In a passage that sounds strange coming from the mouth of the arch capitalist financier who made his money nearly breaking the Bank of England in 1992, Soros says that the whole enterprise of the EU was based on false assumptions, the very assumptions that brought about the near collapse of the financial system in 2008. Specifically those assumptions were that “only the public sector can produce chronic deficits” and even worse that “financial markets would always correct their own excesses”. Soros identified deflation as the real threat now, not inflation. Inflation and deflation are very important not just in economic terms. As I was translating the nearly 8,000 words into Greek for my father to read, sweating and smoking and swearing, I started getting the impression that this text was written by a team, not a single person. I thought I recognised the voice of an economist talking about central banks, the treasury, inflation and deflation. But then there was another dimension to inflation, the historical one. For we all know what happened last time inflation reigned supreme in Germany: World War II. George Soros knows all too well what inflation meant to Germany and ultimately the world.
According to his biography Soros, a young non observant Jew, “survived the Battle of Budapest, in which Soviet and German forces fought house-to-house through the city.” This time, Soros is asking Germany to become part of the solution –if not the solution- not the problem. In his own words Germany has to become a “benevolent hegemon” or to let go. Germany must “lead or leave”. He is urging the Bundesbank to either allow more euros to be printed, or to leave the single currency. In other words Germany is asked to soften the currency, or to let the rest go their way, perhaps with France playing the presidential role.
At the moment Europe seems to be divided along the lines of creditors and debtors. Even worse, somehow, without anyone noticing it has become legitimate to describe countries like Italy and Spain as “the periphery” something patently wrong in terms of their economy, if not extremely dangerous historically. Soros is absolutely right when he points out that a European Union divided in creditors and debtors will not survive, that the euro will break Europe. Such is the anger, the uncertainty and above all the feeling of humiliation in Greece that I am no longer sure that the pieces of the vase can be glued back together.
Because of his background, Soros is extremely worried about these developments. Nationalism, if not outright fascism, is on the rise in the “periphery”. Militias armed with Greek flags, the poles of which are vainly masqueraded batons, roam the streets of Athens and the other cities attacking anyone who looks foreign. Just a few days ago the Greek media reported that a woman called Tsigantes was stopped outside the British embassy by a gang of neo-Nazis, who demanded that she recited the Greek alphabet to prove she was Greek. In Greece we never do drama without comedy. The woman, who holds dual nationality, is the granddaughter of Christodoulos Tsigantes, military commander and founder of the modern Greek special forces, hero of the WWII. Tsigantes took part in many operations in Greece, the Middle East and North Africa, along with the SAS. According to the Greek media such assaults are now common outside embassies in Athens, even those of major European countries.
As the media across the world reported on October 15 2012 that Switzerland held a military exercise called “Stabilo Due” designed to prepare the country for the eventuality of an EU breakdown, Greece went through another day of early 21st century “normality”. As part of the daily routine, the government was once more assessing from which sector to squeeze out some extra tax revenues. The pensioners, the private sector employees on minimum wage or perhaps the public sector ones? The famous “Lagard List” with the names of almost two thousand tax evaders who moved their money abroad, somehow has gone AWOL and cannot be used by the attorney general or the SFO.
Two of the very few truly global Greek companies, FAGE the yogurt producer and 3E, one of the largest Coca Cola bottlers in the world, left the country heading to Luxemburg and Switzerland respectively. The scandalous 1% tax that special holding companies enjoy in Luxembourg, an EU founding member, doesn’t seem to bother Merkel, Lagard or Romano Prodi, nor is it considered institutionalised tax evasion by the likes of IMF and the “troika”, or Mr. Osborne.
As it was just another normal day, Christians full of hatred along with their fascist neo-Nazi comrades from the notorious “Golden Dawn” attacked the “Hytirion” theatre demanding that they cancel the play “Corpus Christi” which they found blasphemous. In other parts of Athens, in arbitrary roadblocks the neo-Nazis armed with their flagpoles demanded that their random victims prove they are Greek. The Greek police stood by. The Greek police always
stand by when the Golden Dawn attack. That’s because one in two policemen from Athens and Salonika voted for Golden Dawn; to an extent, they are
the Golden Dawn.
That explains perhaps why just a few days ago it was reported in the Guardian and the BBC that Greek police had tortured demonstrators in custody. What you might not have heard is that allegedly the police in a few occasions that day shouted at the arrested whilst beating them that yes, “you f***** c*nts, we are the Golden Dawn” and “we’ll show you what Golden Dawn means f****** commies”. Soros knows that when the police doubles as an organised gang of nocturnal thugs, then we are one step or two away from civil war. So I wonder why then would the troika insist in reducing the already low wages of the illiterate thugs who act as law enforcers in the day? Are they trying to make absolutely certain that there will be civil war?
Apparently the Greek state has been negotiating some sort of tax revenue from the deposits held in Swiss banks by ultra rich Greeks. It was just a little news item in today’s Greek media that somehow the few hundred, or perhaps a thousand Greek shipping magnates have somehow managed to exempt themselves from this arrangement. Why pay? Many of those “benevolent” souls made their fortunes by appropriating the Liberty Ships that were donated to Greece by the US after WWII and turning them into one of the most brilliant and resilient wealth generation machines ever. Those people are used to robbing and are used to a state that is subservient and corrupt.
You see, this is where I disagree with George Soros. For Soros wants to preserve the system that made him the famous billion, whereas I say that the system is
the problem. Soros wants to see Germany becoming a “benevolent hegemon.” He specifically wants a more level field for the creditors and debtors and he wants a target of GDP growth of at least 5%. He also wants Germany to allow the ECB to print more money.
The field can never be level when billionaires Filippou and David can move their “holding” companies to an EU country that is allowed to tax their profits with just 1%, whilst I have to sell a house to pay the taxes for a company that is about to go bankrupt. Those are taxes calculated on past years, when the company wasn’t mine and when the main client used to pay on time – the main client being the Greek state. Soros is concerned with deflation and argues that only by growing the economy we can reduce the debt burden. But 5% GDP growth is the kind of growth that will send the planet to its grave.
Soros argues that a two-speed Europe is not viable. Indeed a two-speed Europe isn’t viable, but really this is not about a two-speed Europe. The situation in Greece and the periphery is the test lab of a new kind of Europe: a multiple-speed Europe where pockets of wealth will be surrounded by various degrees of periphery, a dystopia of displacement, inner city violence, deprivation and fighting groups. This is the kind of Europe the troika hinted at when they asked Greeks to go back to six working days or seventy hours a week, as if their aim is to make even less jobs available to the youth, and when they demanded that islands with a population of less than 150 people be evacuated. It’s difficult to tell whether they are being insensitive or whether they are indeed actively pursuing the destruction of the Greek –for now- society.
It is my view that this is a system that we do not control anymore, a system that produces great inequality and which is also about to spill blood in the streets of Europe, if we let it have its way. Far from relying on benevolence and freshly printed money, we have to remind ourselves that the EU was formed as a response to the most devastating war in the history of humankind. We have to examine once more the effects of over-concentration of wealth in the hands of fewer and fewer people, on the economy and the society. In sort, politics have to prevail or politics will come back the way they do in times of crisis: with violence, even war. It may well be that is already too late. Neither the Greeks nor the Spaniards desire charity or bailouts, as much as they do not deserve the humiliation or despair of the last few years.
Petros Diveris, October 2012