IT’S DIFFICULT to know which is the rock and which the hard place, but it is certain that the Greek government if firmly stuck between them. Prime minister George Papandreou is being driven by EU leaders Angela Merkel and Nicolas Sarkozy, and also by Greek public opinion which is increasingly unfavourable to all political parties. He cannot win.
But the government is safe for the moment because no one else wants the job. Elections are out of the question, since no single party would gain an overall majority and coalition is inconceivable; the opposition is content to sit back and watch Papandreou and his still deeply divided Pasok socialist party dig their own political graves.
But Merkel and Sarkozy are equally between a rock and a hard place. The flurry of diplomatic exchanges throughout Wednesday, culminating in Papandreou’s phone call with Merkel and Sarkozy, has done little or nothing to solve Greece’s long-term economic problems, and this is fuelling massive discontent among ordinary citizens.
Nor has it necessarily secured the future of the euro. Merkel is widely seen as attempting to defend the indefensible: a currency which was never thought out as a currency in economic or social terms, but merely as a symbol of political unification.
When the gravity of the Greek economic situation was first realised, Papandreou was offered investment by both Russia and China (which have extensive investments in Greece), but was bullied by the EU into declining the offers and, instead, accepting the EU bailout. This is geopolitics by another name. Merkel’s recent pontification, that she “would not allow” a Greek default enraged public opinion: “Who in Hades does she think she is?” Greeks have long memories – sometimes centuries old – and many remember vividly the German occupation of 1941-44 and the brutal activities of figures such as Kurt Waldheim (later secretary-general of the UN and president of Austria). The mayor of Athens is still seeking war reparations from Germany.
To insist that Greek reforms will immediately solve the current deficit is totally unrealistic: even if the government can effect public sector reorganisation, deregulation of the “protected” professions and sale of national assets (including utilities and property), will not protect Greece from insolvency in the short term. It is one thing to put a state-owned asset on the market, and quite another to find a buyer, especially for a loss-making utility such as the railways.
Unless Greece receives the next tranche of €8 billion of bailout next month, the government will be unable to meet its commitments, other than pensions and public sector salaries.
Effectively, Greece will be insolvent.
In the village where I live, tempers are very frayed. The huge impact on public opinion of the “Indignant” protest in Athens from May to August showed how much more effective is a dignified gathering than union-led rioting.
In one sense people are very angry at what is happening to their country, especially when all are being penalised for the faults of a few, and the way that sovereignty has been eroded – if not confiscated altogether – to the extent that Greece will effectively be owned by other EU states for the foreseeable future, thus mortgaging the hopes of an already dispirited, and largely unemployed, youth population.
In another sense, anger is futile unless it is translated into action, which seems impossible, given the government’s own paralysis. Greece is fighting not only the future, but its own history. The anticipated default is due not merely to current mistakes but to 30 years of profligacy. Greeks cannot tell which is more prevalent: pessimistic despair or impotent rage. Society is on the brink of either implosion or explosion. But which? Even an apathetic citizen carries within him buried rage, and may be all the more dangerous for that.
In view of the hopeless situation, citizens are prepared to withhold the new property tax which falls due in December, even though the government insists it is vital if the current budget shortfall is to be covered.
Yet life goes on. Ordinary citizens, despite their despair, lead ordinary lives. The next lemon and orange crops are well on the way, and many villagers are self-sufficient in vegetables and eggs. The third week of September sees the grapes going to the local winery, and soon after, the long season of olive harvesting begins, thus guaranteeing two of life’s most vital fluids.
These are visible signs of survival, but the consequences of what is seen as inevitable bankruptcy, and its impact on everyday life, are invisible and incalculable.