ATHENS – Greek Statistics Chief Andreas Georgiou, an American-trained economist and former chief of numbers for the International Monetary Fund brought in last year to restore accuracy to the country’s reporting systems, says a pending probe against him on charges of “betraying the national interest” is a politically-motivated attack because he told the truth. After the European Union said Greece had lied for year about its economic condition, Georgiou was appointed to head a new statistics bureau, ELSTAT, to end political interference but says he has now become a victim after he was told to present himself at a formal hearing next month to be questioned about his 2010 report that showed the Greek deficit was 15.8 percent, far higher than the 13.4 percent the government had reported before that.
That report led Greece to need international aid from the European Union-IMF-European Central Bank Troika lending the country $152 billion in bailout loans and setting up a second rescue package of $175 billion. But those came with big pay cuts, tax hikes, slashed pensions and scores of thousands of coming layoffs of public workers, infuriating Greek unions and the political establishment as it sparked 18 months of protests, riots and strikes that led to the downfall of former Prime Minister George Papandreou, who resigned this month to make way for a coalition government that is already squabbling over how to proceed.
Prosecutor Grigoris Peponis cited a claim by Professor Zoe Georganta, a senior statistician who was sacked along with other members of ELSTAT’s board by Finance Minister Evangelos Venizelos earlier this year after she said the deficit was exaggerated “so it would become larger than that of Ireland and Greece would be forced to adopt painful austerity measures.”
“I am being prosecuted for not cooking the books,” Georgiou told the Financial Times. “We would like to be a good, boring institution doing its job. Unfortunately, in Greece statistics is a combat sport.” Georgiou is due to appear before Greece’s prosecutor for financial crime on December 12 to testify. If charged and convicted, he faces a possible life sentence, but the allegations come as the Troika is deciding whether to keep money coming to the country and is depending on accurate statistics that he said he provided.
A second case, filed by the Athens lawyers’ union, also demands a criminal investigation on the grounds that the deficit report was inflated and “damaged Greece’s national sovereignty and violated the constitution,” although it did not give any motive why that would happen. Georgiou said essentially he is being prosecuted for telling an embarrassing truth and because he wouldn’t continue to cover up a pattern of constant lying by the government about the economy even as the country continues to plunge toward possible default. That led the highly-respected Christian Science Monitor to editorialize that Georgiou is being targeted by nationalists.
Temporary Prime Minister Lucas Papademos, also an economist and former Vice President of the European Central with a similar background and reputation as Georgiou, who has gained international respect for his performances, has not spoken out against the investigation into the man heading perhaps the most critical department in the country, an essential ingredient for keeping rescue monies coming for the cash-strapped country. Georgiou said he quickly found a pattern of deceit and deception by government officials and that finance officials didn’t apply proper accounting methods. Eurostat, the official statistics agency for the EU, accepted his report as accurate, but the labor union representing ELSTAT has demanded its workers approve the figures before they are released, undermining the reason why Georgiou was hired.
Georgiou, like Papandreou, was educated at Amherst College in Massachusetts and received his Ph.D in economics from the University of Michigan and before he left the IMF last year was responsible for overseeing the agency’s economic programs with member countries, including Greece and was Deputy Division Chief of the IMF Statistics Department. ELSTAT was set up to be an independent agency but critics said that has been undercut by the investigation into Georgiou’s handling of the deficit report.