Showing posts with label eu debt crisis. Show all posts
Showing posts with label eu debt crisis. Show all posts

Thursday, October 04, 2012

Protesting Greek firefighters - Thessaloniki, Greece

With Greece's creditors demanding still more cuts in public spending in return for the next installment of bailout money, more and more public sector workers are protesting over cuts in wages which are dragging more and more more of those in employment into poverty.

Even while incomes shrink and unemployment grows Greece still remains one of the most expensive countries in the EU for everyday goods and services according to Eurostat.

Tuesday, July 31, 2012

Greece on the move as crisis bites deeper.


For Rent says the sign behind the man. Thessaloniki, Greece

While for many outside the country, the main symptoms of the current economic crisis are the soup kitchens in central Athens, or perhaps the violent confrontations that light up TV screens from time to time,but there is another quieter, yet just as significant trend sweeping Greece. Thousands upon thousands of Greeks are on the move, leaving the larger cities for the countryside or smaller provincial towns or abandoning the country to try their luck abroad. As with so many other economic and social upheavals the current one has forced people to up sticks and try their luck elsewhere. However, this time there are no endless trails of refugees marching along dusty roads, or convoys of dispossessed Okies with their belonging strapped to the top of a car. Instead it's the steady rhythm of friends, neighbours and colleagues gradually slipping away.

There are no firm figures for the numbers involved and those official statistics that do surface in the media often contradict themselves, nevertheless the truth is that something is changing and I see it with my own eyes every day. In every apartment block in every street no entrance hall is complete without a handful of For Rent or For Sale signs, apartments I pass by on my way to work lay empty for months on end, even though the removal vans seem to be doing a roaring trade.

On a more personal level, many of my friends and acquaintances have left the city. Thomas, who's now in Germany, trying to start a new life, Anne and Makis who have decided to go back to Makis's home town of Alexandroupolis, Panos who is off to Crete to try his hand at farming after losing his job in the latest round of job cuts, and so the list goes on.

And most importantly for me, my own 12 year old daughter, who is now living in central Greece, after her mother's business finally succumb to the crisis., so obliging her to move back to be closer to the her own family and the support they can offer. So instead of being a weekend dad, I've become a fortnightly one, as every two weeks I catch a train to Larissa, and then a coach and then a lift to see her in her new home.

I do not harbour any bitterness to my ex for her decision, she tried everything to find work in Thessaloniki and when that didn't work out she was left with no real choice. Given such unpalatable options, you do what you can to survive.

This weekend though, my daughter is staying with me, or to be more accurate she's staying over at a series of friends, catching up on lost gossip and news from the classmates she left behind. Even then, the story is the same. One has left for England, another is going with her family to Australia, another's family is contemplating moving back to Albania if things do not improve in the near future.

Ironically, my financial situation has stabilised and unlike the last few summers, paying the rent and bills is not something that wakes me up at 4am in a cold sweat. I've even been in the enviable situation of turning down jobs (don't worry, I passed them on to friends in need) in order to take a couple of weeks off but this is something I usually keep to myself as complaining about work when so many around you are desperate for any kind of job seems the height of bad taste.

Those left behind hang on, hoping that things will change soon or praying that their job won't be the next in line. All the while the new government at the behest of Greece's creditors carve yet more slices off the public sector and chase after an ever dwindling tax base. This week it's the turn of higher education as Athens desperately seeks to find another 11.5 billion euros worth of spending cuts and so has announced the closure of at least 30% of the university and polytechnic department, effective immediately.

On the other hand it feels at times like being on a raft in the middle of a storm and all you can do is cling on as tightly as possible and focus on the few inches in front of your face, you do not have the energy to imagine what will happen next so all you do is focus on the immediately around you and forget the rest.

Monday, June 18, 2012

Greece election post mortem

Antonis Samaras, head of Greece's main opposition party, New Democracy

First things first. An apology to anyone who  bet (and lost their shirt) on my prediction that SYRIZA would be the largest party in parliament today, if I see you, let me buy you a drink, it's the least I can do. As it turned out my analysis was off the mark. I overestimated SYRIZA's final vote and more crucially underestimated the final New Democracy tally. Also I didn't see the collapse in Greek Communist party support which halved, unlike PASOK and Golden Dawn who only saw a small drop in votes received. All in all, my days as a poll pundit are numbered. (Vote statistics can be found here).

Why was I so wrong? First of all, I failed to grasp just how successful the fear campaign over possible Greek exit would be. I had assumed that the constant barrage of warnings over the consequences of Greece having to leave the Eurozone had done its work and wouldn't push Samaras's vote over 25%. On the other hand the record low turnout (down 8% from 2009) seemed to have had an effect, I suspect on younger voters who would have supported anti-bailout parties. Finally, the scenes of violence perpetrated by Golden Dawn spokesman on live TV did nothing to diminish their popularity, which is both surprising and deeply worrying.

PASOK leader, Evangelos Venizelos

Mea culpa aside, today the New Democracy leader, Antonis Samaras will be asked by the president of the Greek republic to form a government. At first glance this seems just a formality as New Democracy with 129 seats and the other pro-bailout party, PASOK with 33 seats will comfortably exceed the 151 MPs needed to form a majority. Indeed both leaders in the last week of campaigning repeatedly stated the need for the country to immediately have a working administration in order to deal with its current economic meltdown.

However, beyond the campaign promises, Samaras and PASOK leader, Evangelos Venizelos have to take into account other factors concerning their own and their parties' political future. If they do assume power, then they will be seen as the parties that are responsible for the country's economic woes, leaving SYRIZA and others to claim that have are the only real anti-austerity choice in any future elections. Given the drubbing PASOK got and the marginal victory achieved by new Democracy that more or less guarantees their defeat in the next elections (barring an economic miracle and the Germans have outlawed miracles).

Alexis Tsipras, head of the The Radical Left Coalition, SYRIZA

The answer to this dilemma is to try and persuade SYRIZA leader, Alexis Tsipras to join the government with promises, appeals to patriotism and threats of possible dire economic consequences if he does not.This card was played after the May elections and judging by official SYRIZA statements coming out in the Greek media such overtures are almost certainly likely to be rejected. On the other hand the Democratic Left have made it quite clear that they will be willing to take part in such a government. But this does not solve Samaras and Venizelos's long term problem about how deal with Tsipras in coming elections.

The other factor which plays a crucial role in any negotiations is ego. Even with Greece mired in the worst economic downturn, the monsterously overblown egotism of both Samaras and Venizelos may prove an obstacle in forming a stable government. Both have spent decades slowly working their way up the greasy pole of political power and just as they seemed to be destined to become prime minister, the game changed. To have to share power after so many years playing second fiddle is almost more than either can bear.

Whatever form the next Greek government takes, its fate will not be decided in Athens but in Berlin and Brussels. If the troika (EU/ECB/IMF) are serious about supporting Samaras then serious concessions in the terms of the current austerity measures will have to be made, otherwise with unemployment rising 1% every two months and the economy contracting the fragile New Democracy - PASOK (and possibly Democratic Left) coalition will fracture under the weight of more job cuts and tax hikes. At which point Greece holds yet more elections and most likely brings to power SYRIZA.

There seem to be mixed signals coming out of Europe over whether there will indeed be a change in approach which will allow New Democracy to stay in office, on the one hand deputy German finance minister, Steffan Kampeter said that Greece shouldn't be overstrained during a talk on German TV, on the other the Eurogroup of EU finance minsters sent a polite but clearly worded statement last night warning Athens that it could not deviate from the term of the bailout agreement.

With cost of lending in Spain continuing to rise and with Italy on the verge of asking for its own bailout deal none of this may matter as the systemic problems of the Eurozone continue to rage unchecked, leading to possibly disastrous results for European debtors and creditors alike












Sunday, June 03, 2012

EU to appoint southern European "Debt Czar"

"Don't be too proud of this fiscal terror you've constructed. The ability to destroy an economy is insignificant next to the potential of the Euro."

Friday, May 18, 2012

Thursday, May 10, 2012

EU and Greece's high stakes poker game.

Evangelos Venizelos by Teacher Dude's BBQ
Evangelos Venizelos, a photo by Teacher Dude's BBQ on Flickr.


This time my prediction proved right and Alexis Tsipras this morning told the Greek president that his SYRIZA (Radical Left Coalition) party is unable to form a new government. This means that the task now falls to the head of the centre left PASOK party, Evangelos Venizelos, however, the chances of Venizelos, whose party lost 70% of its parliamentary seats in Sunday's elections, faring any better than Tsipras or the conservative leader, Antonis Samaras are slim.

It is becoming quite obvious that under the present economic conditions any party working with PASOK or New Democracy in order to form a pro-austerity government is signing their own political death warrant and with elections likely in June that mitigates against any agreement.

So what happens next?

Tsipras used his time in the political spotlight to further underline his party's opposition to the terms of the Greek bailout deal and made it quite clear that if the Radical Left took power they would play a very different game from their immediate predecessors. Also in a parliamentary address broadcast live on TV last night at 9pm he reached out to other groups on the left, both trade unions and political parties in what could be called the creation of a united front in any new national elections. If SYRIZA can attract some of the smaller left wing parties and get the Ecologists to sign up there is a good chance that they may overtake the conservatives in the polls. In addition the language Tsipras used was also aimed at the supporters of the Greek Communist party (KKE) who may be persuaded to switch allegiances. There are rumblings of discontent amongst KKE rank and file members who are unhappy with Aleka Papariga's unwillingness to form wider political alliances.

Samaras supporters light up flares during New democracy rally - Thessaloniki, Greece

The prospect of a radical left wing, anti-austerity government in Athens has, predictably enough provoked a strong reaction by both local and European elites. Already the local media are running scare stories blaming political instability for falling tourism bookings and saying that ΣΥΡΙΖΑ would use power to grab people's savings. In a similar vein, both Samaras and Venizelos claimed that such a government would get the country kicked out of the Eurozone and the EU and would lead to economic collapse.

On the European level last night the EU said that it was delaying payment of part of the latest bailout tranche, of the 5.2 billion euros promised, only 4.2 billion will be released today, the remaining 1 billion destined to fill holes in the Greek government's day to day running costs will be paid at the some unspecified time in June. Such crude blackmail attempts underline the sense of unease being felt in Brussels and Berlin at the prospect of Greece defying creditors and possibly derailing the entire EU austerity program.

There is an other possibility as the BBC's Paul Mason pointed out that in light of the elected parties being unable to form a government and unelected technocratic caretaker government would be charged with passing the latest cuts and tax hikes scheduled for June and July. Such a move would plunge the country into even more political turmoil as people would see it as a clear defiance of the anti-austerity message the national elections sent. In such a climate the legitimacy of the parties participating in such a government would be shredded, opening up opportunities to other less mainstream parties, including the neo-Nazi Golden Dawn who already have 21 MPs in parliament.

Thank God for the IMF and ECB

Once again the Greece and the EU are playing a game of high stakes poker, upping the ante and hoping that the other will fold first. However, unlike previous round the mood in Greece has changed dramatically with the worsening economic crisis and threats of dire social consequences of failure to comply no longer hold such sway. With youth unemployment at 50% and the thousands of businesses closing every week, for many the worst has already arrived.


Monday, May 07, 2012

End of an era in Greek politics

Sea of Greek flags being waved by New Democracy youth wing

With the dust settling on yesterday's election results only one thing is certain in Greece; the previous political era is now officially over. Both the conservative New Democracy and left wing PASOK parties who've dominated the stage for more than a generation received a drubbing at the polls. Even though New Democracy emerged as the largest party, it garnered just 18.89% (at time of writing), just over half its 2009 election share. PASOK, lead by Evengelos Venizelos suffered an even more crushing reversal, and is left with just 41 seats, down 129 from 2009.

Other losers included the far right LAOS party and conservative Democratic Alliance who both failed to reach the 3% threshold for parliamentary representation. Also the plethora of splinter groups/parties set up by expelled PASOK and New Democracy MPs failed to make any headway, with the sole exception of the hard right Independent Greeks lead by Panos Kammenos which won 33 seats.

On the other the Radical Left Coalition (SYRIZA) came second in the polls, just a few percentage points behind New Democracy and gained 51 seats,and would be just 7 behind the conservative if it were not for the electoral rule that awards an extra 50 seats to the party with the most votes. The newly minted Democratic Left also entered parliament for the first time with 19 seats, having attracted much of its support from dissatisfied PASOK voters.

However, the official communist party KKE proved to have a disappointing night, increasing its share of the vote by less than 1%, a reflection that its old style campaign failed to reach out and convince few new voters.

The more worrying development was the rise of the neo-Nazi Golden Dawn party who are set to have 21 seats in parliament. The extremist group which has been linked numerous acts of violence against immigrants and political opponents are not simply a far right formation but rather a party that believes fervently in many of the core tenants of national socialism and Hitlerite ideology. Their ascent to power allows them a place in the political mainstream and assures them airtime on TV and radio from which they can promote a platform of racial hatred and political intolerance.

With the old political order in tatters and a parliament fractured so deeply along deeply held ideological lines forming a  new government will be difficult. In the immediate aftermath of the vote many party leaders rushed to deny that they'd form alliances with others. For example KKE leader Aleka Papariga came out against an alliance with SYRIZA while Kammenos ruled out possible partnership with New Democracy. On the other hand ND leader Samaras and PASOK leader Venizelos are reaching out to other political forces in the hope of creating a viable block.

What is clear is that neither the left nor the right are in a position to form a majority government of their own, and that means either new elections immediately or a fractious coalition unlikely to survive the backlash generated by the latest round of job cuts and tax hikes which are likely to the poorest hardest. In that case new elections during the summer seems unavoidable.

The irony is that the unbending demands of the troika (IMF, EU and ECB) has created exactly the situation they were most anxious to avoid, one in which Greece is unable or unwilling to implement the austerity measures that are part of the next "bailout: plan.




Monday, April 23, 2012

Greek national elections set to create new political landscape

Greek elections 2007

Or Far From the Madding Crowd as perhaps the elections should be named, considering the fact that few, if any of the members of the coalition government are able to campaign in public. Instead of the mass rallies that usually mark elections in Greece, both PASOK and New Democracy politicians have been careful to hold meetings behind closed doors with just the party faithful present.

With just two weeks to go the national election campaign has been so low key as to be considered to be virtually non-existent,. No election centres have been set up and campaign billboards and handouts are nowhere to be seen. This is partly a financial matter as the two main parties owe 240 million euros and only last week did they manage to pass legislation to reschedule their debts (a privilege they ruled out for lesser mortals, or voters as they are know locally).Instead of a country plastered in posters and drowning in flyers PASOK and New Democracy have reserved their efforts for TV talk shows and the internet. Both choices are problematic; TV has been shedding viewers for years, especially among the young and more educated and social media is not a comfortable environment for politicians unused to debating with voters except on their own terms. Indeed their ham fisted attempts to replicate traditional electoral methods online have been met with derision and biting humour by Greek language bloggers and Twitter users.

However, even more troublesome than lack of funds is the growing realisation that parties that took part in the various coalitions in the last year are now unable to talk directly to voters.Public anger with the government and the political system in general has reached such a pitch that even their presence provokes angry, sometimes violent reaction from the electorate. Rising unemployment, an endless series of tax hikes and a collapsing economy have all helped generate a level of disgust with public figures unprecedented in modern Greek political history.

The tipping point proved to be last 28th October when people attending the annual military parade in the northern port city of Thessaloniki closed roads and jeered the country's president, forcing him and other present in the VIP stands to flee. Ever since then politicians have done their best to avoid making public appearances whenever possible. The only exception being the 25th March Independence parade in Athens but only after presence of nearly 10,000 police officers ensured that no possible public protest was possible.

For the first time in a generation there is a real possibility that neither PASOK nor New Democracy will be in a position to rule, either alone or even in coalition, if recent polls are to be believed. Even with gift of 50 extra seats that the constitution gives to the party with the most votes, PASOK and New Democracy may be forced to seek other coalition partners. Even turnout is low then their rump support may be enough to win the day, however, if people decide to vote in greater numbers in order to punish ruling politicians as many as 10 parties will be entering parliament.

Given the the unpopularity of the current austerity measures any party that signs up to enforce yet more of them is flirting with backbench revolt and voter backlash. The falling poll figures for PASOK, New Democracy and the far right LAOS party are testament to that.


Given the fractured ideological natures of the new parties( which may include members of the neo-Nazi Golden Dawn)  and the lack of support for austerity the most likely outcome is a series of elections which, given the commitment of the previous government to cut wages and pensions while raising new taxes in June likely to diminish the power of both Evangelos Venizelos and Antonis Samaras, both of whom are faced with the prospect of leadership challenges from disgruntled backbencher unhappy with their parties' choices and anxious to rid themselves of those associated with deeply unpopular policies.


Friday, March 09, 2012

Where they make a desert, they call it salvation

Tacitus updated for modern economic realities.

As Greece slides further into an economic downturn that matches the very worst period of the Great Depression, the country's creditors and and the domestic political elite talk of salvation, prosperity and growth.

Wednesday, February 08, 2012

As Greece drifts towards disaster, what happens next?

Protest march in Thessaloniki, Greece in support of nationwide general strike by Teacher Dude's BBQ

As the negotiations between Athens and the country's creditors over the terms of the next austerity measures wind up there is a growing sense on the internet and in the streets that Greece is tipping over into disaster. While it's easy to get carried away by the hyperbole and hysteria that accompanies much of the reporting of the present situation the reality may indeed be living up to the feverish imaginations of headline writers. 

Unemployment has continued to climb as the number of businesses going under increases, in part the result of falling incomes and a series of crushing demands by Athens for more and more tax revenue. The irony is that each increase in either direct taxation such as that on properties or indirect via VAT has brought less and less money into government coffers. Yesterday's Greek Finance Ministry report showed that instead of an expected  rise in revenue Greece's income has dropped by 7%. 

At every single turn price hikes have resulted in fall of consumption, even for items as basic as heating oil, as people either do without or turn to alternative sources such as wood often illegally logged from the country's forests. 

Yet despite all evidence to the contrary, the European Union and in particular the German political leadership  is insisting on yet more cuts in public spending on pensions and health, more job losses and a drastic cut in the minimum wage. Hardly surprising, given this and the years of vilification the German right wing press Greeks are becoming more open to anti-German feeling, as witnessed by the burning of a German flag outside  parliament during yesterday's demonstrations in Athens. While many have been quick to condemn such actions such sentiments are the exception rather than the rule as anger, frustration and indignation replace calmer analysis.

Greek trade unionists march against latest austerity measures

In response to the latest cuts trade unions called a general strike for Tuesday with limited results, many public sector employees carried on working while the turnout for marches was low, with just a few thousand participating in Athens and Thessaloniki. Some argued that the last minute nature of the call combined with unusually low temperatures were to blame. However, I believe there is a growing despondency which has taken hold of people, the conviction that whatever they do nothing will change, feed by the fact that after two years of austerity and four years of economic decline marches, strikes and other protests have not succeeded in halting the malaise.

This, however, should not be mistaken for acceptance, no matter how grudging, of the new economic measures, anger over those and disgust with the current political system is greater than ever. It's is now an article of faith that no member of government can appear in public without presence of riot police units to protect them from their own voters, sometimes even members of their own party. What people lack is a focus for their frustration and the possibility that they can change the present situation.

With the dissolution of established forms of protests and dissent there is a growing danger that popular anger will explode in ways that cannot be directed or contained in the traditional way and with unpredictable consequences. With money drying up and families resources dwindling more and more people will be open to any suggestion, no matter how radical or extreme that offers them even a glimmer of hope for the future.

Monday, January 16, 2012

What we've lost - A personal account of the crisis in Greece

Lydia


I could give you a list of statistics and figures that show just how grim the situation has become in Thessaloniki, such as the rise in unemployment or I could tell you how many businesses have closed down in the city over the last 12 months. Then, there are the number of suicide attempts "successful" and "unsuccessful" that have taken place in Greece recently. But I doubt that they would mean much to you. Numbers have a strange way of draining the life out of any disaster, reducing it to simply an accountant's end of year report.

Instead I would like to talk about what I have lost and through that give you an idea of the what people are going through. For me, the most poignant memory of late has not been people sleeping out in freezing temperatures or pensioners scavenging for for food in rubbish bins, nor has it been the sight of kids as young as eight years old collecting scrap metal from bins and off the street to sell. No, for me the worst image has been that of a cardboard box, inside it the things my daughter will be taking with her to her new home 200km from here.

Unable to survive economically in the city Lydia's mother has decided to move away to be closer to her side of the family. The small flower business Maria has struggled to keep afloat for the least two years is now completely unviable and so is being closed down. With people now waiting to see what happens before getting married and fewer and fewer buying flowers to take as presents to friends and family the shop has become a liability and will shut in the next few days.

For my daughter it means leaving her friends, school and home to start out afresh in a new community, a tough challenge for anyone but especially so for a twelve year old on the brink of teenage.

As for me, that means the amount of time I get to spend with her will be drastically reduced, no longer will she be just a bus ride away but every visit will need to be co-ordinated and so will lose the spontaneity I so cherish. Of course, 200km away is not another world but it is far enough to make visiting much more difficult.

So far I have hidden all these thoughts from my daughter, she has enough on her mind without an adult's compliment of concerns, so instead I've kept on emphasising the benefits of moving to a smaller community where she's have more freedom to roam and even have her own cat.

I cannot fault her mother for her decision as things have got so bad in Thessaloniki that any alternative form of decent employment is just a pipe dream. Even when work is available friends have been telling me that wages as low as 300 euros a month are bring offered. And if you don't like it there are plenty more desperate people who do. Just to give you a sense of perspective 300 euros is barely enough for rent let along food and bills. And of course such wages come without health benefits or unemployment insurance.

Lydia's mother is making a rational choice and abandoning a sinking ship and in that she is not alone, so many friends have left the city either to return to the small towns or villages they came from or alternatively gone abroad to places as diverse as Germany and China. Indeed, anywhere where they can have something resembling a living wage and a future.

On the other hand I've been lucky in being to keep my head above water financially, but that is just for the time being, my lessons are growing fewer and no new ones are coming along. Occasionally, I am asked if I want to take on new students but almost invariably it doesn't work out as people struggle to pay yet more taxes and rising prices for basics such as power, food and transport.

Like so many others I have had to give up so much over the last 12 months, eating out is just a memory as is going to the cinema or buying new clothes. instead you feel happy if you can earn enough to pay your rent this month and still have enough left over to go food shopping. And I'm one of the lucky ones. Today 20,000 households and businesses will have their power cut off as they did not pay the latest property tax hike included in their electricity bills. The total number of accounts under threat is estimated to be a quarter of a million.

In the meantime Greece's political leaders bicker and pose for the cameras daily issuing statements that show that they have lost touch with the mounting crisis outside parliament. locked away in their offices, surrounded by police guards they indulge in power struggles over who will take over once the present party leaders are toppled. However, given the plummeting poll figures for all three parties involved in the present coalition government whoever the the next leader is, they are about to be charge of not much at all as much of the Greek electorate has written them off as corrupt, venial and inept.

But little of that matters, the packing cases containing my daughter's possessions are still in her bedroom, awaiting a removal van to take her off to a new life and I'm still here trying desperately not to get sucked down into the kind of despair that has debilitated so many people I know.