On 15 Febuary, I was listening to Nigel Farage’s intervention in the European Parliament about the Greek crisis (http://www.youtube.com/watch?v=W8Ayb8P1LbU).


For those not familiar with the name, MEP Farage is leader of the UK Independence Party and President of the Europe of Freedom and Democracy Party in the EP. Have long considered myself an enthusiastic supporter of European integration, Mr Farage is usually not the type of politician I would find a lot to agree with. Read interesting info about a group interview, the rules of the game are different. Yet, I was shocked to see how much his words resonated with me.


The truth is that Greece is no longer governed by an elected government which serves the interests of its people. It is run by the troika which flies in every three months and dictates unpopular demands raised by our creditors, intended to enable the country to pay back its debts and stand back on its feet. The results have been exactly the opposite. Not only has the debt kept on increasing, moreover, the Greek economy has entered a downward death spiral and its people suffering a brutal economic adjustment that is destroying any remaining traces of social cohesion.


I don’t intend here to start a blame game. For me, clearly everyone is at fault: on the one had, all Greek governments to date for economically mismanaging the country until 2009 and subsequently proving completely incapable for managing the crisis; and on the other, our European creditors for implementing a catastrophic economic policy that has been mainly driven by domestic political considerations and the perceived need to make an example out of Greece, as a deterrent to others.


It is often argued that there is no alternative. Of course there is, it is simply that our creditors do not wish to consider them due to a lack of vision and leadership. We should not forget that the European Union was created out of the biggest destruction mankind has ever experienced. Visionary leaders on both sides of the continent resisted at the time the urge for revenge and performed what could only be described as a quantum leap in statesmanship that enabled (Western) Europe to stand back on its feet and reach where it is know. Had the leaders at the time acted like Europe’s governments now, we would have most likely remained a bitter and divided continent, often at war or with the threat looming constantly over our heads.


To argue that the European project is in grave danger of unraveling would be an exaggeration. Yet, what cannot be denied is that the Greek debt crisis is opening old wounds and reviving national animosities, exactly what the EU was intended to resolve.


As a Greek, I have naturally been significantly affected by the plight and desperation experienced by many back home. Moreover, living in Brussels, I have had in the past year numerous opportunities to discuss with Portuguese, Italians and Spaniards about on-going crisis. While we may not have agreed on everything, there was clearly a common frustration and resentment about how Germany and its allies are managing this crisis.


Germany is clearly a country that ought to be seen an example in many ways. I personally would have no objection to Greece becoming like Germany. It would imply a far better functioning state which could provide a real service to its citizens and not waste tax payers money (for the part of the Greek population which actually pays them). Yet, this will not happen overnight and, judging from outcome of the ‘rescue package’, the means can no longer justify the ends from a moral standpoint.


A continuation of the current policy not only seems unlikely to change things around. Far more worrying, it risks planting the seeds of hatred which have overshadowed this continent one too many times.



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  1. What alternatives are you referring to , when you say there are alternatives that creditors do not wish to consider? What would you do if you were the kind of visionary statesman that you say Europe needs right now?

  2. GREECE BANKRUPT? Why don’t see it this way [from a forum, interesting, frorward]

    All of us in this world were working and had a living until recently. Suddenly the money is gone. Where has it gone? Well, we, the people, make money by contributing something to society. That makes the real money circuit. Others make money with money, they don’t contribute anything to our society but only suck real money out of your purse. Money is not a commodity but is to make barter easier. When we put 100 dollars of our real money into a bank, the bank is allowed to lend the real-money makers [us, workers] ten times the amount you put in, or 1000 dollars. You think you get money from them but it is credit only, it has no value at all. Immediately they start cashing in, say 7% real money for it from you, or 70 dollars a year while you get 2% for your 100 dollars in their bank that make their business possible, so you get 2 dollars. Thus they make 35 times more than you do and on money that does not even exist. With their profit [interest], being your real money from labor, they buy up the world and return your real money to your real money circuit to start the game all over and over again. That way they become richer and richer with fake money without contributing anything to society. They eventually finance wars to keep their business going. When they overdo this, people are going short on their real money from labor and that is what causes the trouble in Greece. But don’t bother. They are not the only ones. This is happening all over the world now so stay put. Always realize that there are two money circuits: a real one and a fake one which is 10 times or more bigger and which is what the rich live on and keep us in line. Oh, there is a third circuit within the real money circuit from work: the black money circuit. But that is real money without paying tax for our society. In some countries it is 40% or more. Eliminate it and the country goes bankrupt. Is everything clear now? To stop them from draining you, simply put as little money in the bank as is necessary for your business [barter] and don’t borrow their fake money. Better is not to borrow at all. Muslims and Jews know better. They are not allowed to ask interest [real money from labor] for a loan to their own people however gentiles are outlawed as far as I know. Let’s learn from them or walk the line to slavery. We may wish Greece all the best. Nice people, nice country, nice climate, nice history and they did well before they stepped into the Euro. Good luck Greece.

  3. There are alternatives which have been already been widely debated by many but rejected by the establishment.

    The principal one is to allow the European Central Bank to be able to lend to States at low interest rates in cases of financial difficulties.

    This proposal has been rejected for two main reasons;

    – first of all because it not legally permitted by the Lisbon treaty

    – Second, because this idea is anathema to the Germans, who are afraid that this sort of move will create more complicity amongst southern nations, who as a result will not make the necessary reforms.

    As for the first part, it is true that the European Central Bank (ECB) is prohibited by article 123 of the Lisbon Treaty to lend to Member States directly. Yet, we should not forget that the European law (Article 107 of the Lisbon Treaty) also forbids Member States to financially support private institutions. This did not prevent, however, the European Commission to adopt special rules in 2008 (with the consent of member states) that allowed European governments to save the banking system from collapse (with taxpayers money).

    As for the second objection, it is principally a matter of trust or, to be specific, a lack of it. Understandably, Germany has no faith in Greek politicians. Thus, it is unwilling to allow for Treaty Changes that could provide Greece with cheap credit as it fears that this will simply allow irresponsible politicians to carry on the same path and destroy any chances of real reform there.

    There is a rationale there, which however, operates on a logic of black or white. In other words, given that cheap credit would seem to reward irresponsible politicians and prevent any real change, we need to go for the opposite, i.e. a harsh and austere economic programme that will punish the wrong-doers and force through change.

    Yet, as we all know, life is never black or white, rather it consists of various shades of grey. In similar fashion, policy options are rarely mutually exclusive.

    The Greek rescue packages are based on three pillars: fiscal consolidation, state reform and economic growth. The major flaw of the package is that it puts too much emphasis on the first pillar and too little on the third. These leads to a vicious cycle whereby negative growth requires ever more sacrifices by citizens to achieve fiscal consolidation and which ultimately impedes the progress of state reforms due to political difficulties.

    What is urgently needed is some cheap credit that can help counterbalance the fiscal consolidation measures, which, although necessary, are by nature recessionary. And this can be done by the ECB, provided there is the political will to do so.

    That Greece messed up, no one can deny. But so did the banks. But in the latter case, instead of a really harsh conditional bailout, the response was an immediate injection of taxpayers’ money, coupled with promises of unlimited guarantees.

    On 21 December 2011 alone, the ECB lent € 500 billion to banks with an interest of 1% in order to help them cope with the crisis. Is it so difficult to imagine that governments (and by default European citizens) could enjoy the same benefits in times of difficulties?

  4. Dear Schickendantz,

    You raise a number of interesting points.

    I completely agree with you that more emphasis should be given to the real economy as opposed to the money markets. If anything, the money markets should be there to serve the real economy, not the other way around. This was a case for some time and don’t see why can’t go back to such a system, i.e. a banking system which is tightly regulated and compartmentalised which can provide loans and credit for real things such as buying a house, starting a business etc.

    This also requires a shift in people’s attitudes, i.e. a realisation that consumerism is not an end in itself and that true happiness does not lie in constantly buying product. My parent’s generation had far less than we did, yet had in many ways a better quality of life given that there basic needs were met (they had a job and a family to rely on). When you see people queuing for hours to be the first to buy the new i-Pad than you cannot help but think that something is going terribly wrong in our world.

    As for the black economy, I will disagree with you. Black markets tend to favour certain groups over others, which is inherently unfair. Greece is a country with a huge black market and this has always tended to penalise employees and pensioners, who have always had to pay the bill for independents workers, who dodge taxes systematically. If you play by the rules, yet end up always being penalised, you will, after a while, no longer be willing to contribute your fair share. This creates a vicious spiral which ultimately results in the collapse of the social state as happened in Greece.

    Taxation and the rule of law are essential features of a modern society. What is needed is not an expansion of the black market but a fairer taxation system also allows the wealthy and companies to contribute their share.

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