You either keep your word and push the mid-term program immediately or you will not be given the next trench”, said Troika officials to George Papandreou and Evangelos Venizelos. Surely it must have come as a shock for both men that they were actually asked to do what they signed on to do only two months ago. After all, postponing, making excuses, lying, deceiving and creating brand new Greek “Πατέντες” aka Greek statistics to “fool” their European counterparts has been the most popular Greek political hobby for the past thirty years. Only this time, the bad people/ creditors had enough.
“So what?” answered a tired, frustrated, fed up Wolfgang Schäuble to Evangelos Venizelos when the Greek Minister of Finance told him he cannot push the public sector layoffs as the political cost for the government might be fatal. “We’ve lost twenty-five MPs today mainly because we are trying to convince German tax payers to lend you money.” answered Venizelos’ German counterpart.
European leaders -even those that used to advocate for Greece’s bail out like the French President Nikola Sarkozy-appear disappointed and reluctant to release the next round of bailout cash as Greece hasn’t achieved any of the agreed goals. In an attempt to calm them down Mr Venizelos, announced new measures that include increasing the number of civil servants to be suspended on partial pay to 30,000 this year from 20,000, subject monthly pensions above euro1,200 to new cuts, as well as taxing people making six thousand Euros annually! But how did we get here? How has a “socialist” government ended up taxing someone who makes five hundred Euros a month? And are the Europeans really that mean -some would say stupid- encouraging this kind of policies?
The answer is that European leaders are not mean or crazy. They are fed up of trying to rescue a country weighed down by its debt and relying on financial lifelines from its neighbors. They are fed up of listening to the same old stories of Greek politicians who still haven’t realised their country’s state and keep mumbling the same populist slogans to make themselves likable to their voters.
They’ve reached a point where they don’t care how the Greek government will find money. They can’t be bothered whether Greece will go on and apply the structural reforms needed both for its over-bloated public sector and its hideous tax system. They want civil servants out and new taxes imposed here and now, not caring whether these deeply unfair measures will plunge Greece’s society into chaos and violence or even to a full-scale civil war. And why should they care if the country’s own voted representatives don’t?
The “We will reduce tax evasion” joke
The Sunday Telegraph sites figures gathered by the world renowned expert Prof Friedrich Schneider of Linz University in Austria that show Greece’s shadow economy – made up of the trade, goods and services, both legal and illegal where taxes are not paid – grew from 24.3pc of GDP in 2008 to 25.4pc in 2010! This compares with 10.7pc of GDP in the UK, 13.9pc in Germany, 19.4pc in Spain and 21.8pc in Italy. Looking at these figures your really don’t need to be an economist to realise that the tax-system is basically non-existent. In Greece, you only pay taxes if you feel like it to and as it turns out not many Greeks feel like it!
Manipulating a corrupt tax system, wealthy Greeks simply say that they earn below the current basic tax threshold of around £10,000 a year, even though they own boats, second homes in Mykonos and properties in London or Paris. And, should the naughty taxman “bother” them, the magical ‘fakelaki’ — an envelope stuffed with Euro notes- shuts him up right away. And with George Papandreou’s rather innovative-some would say bizarre- methodologies to trace all these “mpatahtsides” – by deploying helicopter snoopers, along with Google Earth satellite pictures, to find out who owns a swimming pool in the posh northern and southern suburbs of Athens, it’s no surprise that Troika officials can’t help themselves when Evangelos Venizelos utters the words “tax collection”.
The “We will reduce the public sector cost” joke
Back in 2010 George Papandreou reassured his European counterparts and the troika that he will sort out Greece’s chaotic public sector. Almost two years later, civil servants still receive pensions equating to 92 per cent of their pre-retirement salary (!) still get a bonuses for showing up to work on time, and for carrying an envelope from the first floor to the second while foresters still get a bonus for working outdoors (!) and trolley drivers for fixing the trolley’s antenna! The daughters of deceased civil servants can still claim their father’s pension for a lifetime if they remain unmarried! As Mr Venizelos is trying to convince Troika to give him the next trench, about 40,000 women benefit from this law, putting an annual cost of around 550 million Euros, on the back of a social security system about to collapse any time!
So while the majority of Greek people are making many sacrifices, their pseudo-government representatives keep arguing with their New Democracy opponents on TV shows about which party harmed the country the most for the past 35 years. At the same time, political and social stability have already started disappearing in Athenian neighbourhoods. And should the EU and the International Monetary Fund withdraw their support even for this pseudo-government, chaos will inevitable occur in a country that is already drowning in depression and angst with recorded suicide rates having roughly doubled since before the crisis to about six per 100,000 residents annually, according to the Ministry of Health.
But no one seems to care anymore. Not the country’s own politicians, not the French or the Germans who back in 1986 voted for the Single European Act in order to build a new Europe, a political union with a common constitution, common fiscal, economic and social policies and a common currency that would protect all European citizens. It turns out no one remembers those high ideals any more and the historical idea of the European Union is permanently forgotten. Europe is sinking into irrelevance between Asia and America while riots by its suffering citizens are spreading rapidly.
Right now, the Euro-zone displays more similarities to a hard core reality show where members-players -good Europeans can expel the weakest link-bad Greeks and drive them straight to economic catastrophe without caring about the hidden cost of Greece’s expulsion: a new jobless, homeless, hopeless Greek underclass.
So, goodnight and good luck Greece.