Thursday, 3 December 2009
Thursday, 26 November 2009
Worth reading: The FT's opinion/editorial on November 30.
Thursday, 19 November 2009
Today's student generation still sees the Polytechnic as the iconic political event of postwar Greece, and longs to prove its ideals as indelibly. The slogans churned out this year spelled as much. For example:
Οι εξεγέρσεις δεν μπαίνουν στα μουσεία,
Εμπρός για της γενιάς μας τα Πολυτεχνεία.
(Uprisings don't belong in museums; onward to our generation's Polytechnics)
And the anarchically defiant:
Σ'αυτόν τον τόπο, σ'αυτήν την κοινωνία,
Οι εξεγέρσεις γίνονται, δεν είναι ουτοπία.
(In this place, in this society, uprisings are a fact, not a utopia).
Thursday, 12 November 2009
Institutions are left to fight for the values on which both the US and the EU were founded. On November 4 the European Court of Human Rights ruled that crucifixes had to be banned from Italian classrooms. The Vatican said it would fight the ruling.
Here is a debate that has troubled Greece again and again. On the one hand rationalism cannot be taken for granted - it has no church to represent and reinforce it. On the other, there are non-rational things which contribute to a people's sense of identity. Italy is not the only case of a European Union member with a default religious identity. Here in Greece it would be considered a form of national betrayal for the government to enforce a similar court ruling. The Orthodox church is still enshrined as the official faith in articles 1-3 of the constitution, and forms an inseparable part of the Greek sense of nationhood.
Monday, 2 November 2009
Now newspapers are fighting back. If News Corp. successfully leads an industry-wide about-turn to do the unthinkable and charge for online content, newspapers may stop the decline in their revenues.
Last June I stepped down as Editor-in-chief of the Athens News after a decade at the helm. It was an exhilarating time – not every editor enjoys complete editorial independence – but also a challenging time to run a paper. The Athens News' trials during this decade are a case study in what works and what doesn't work in turning a newspaper around; they also point the way to possible future solutions for that minority in mainstream media – newspapers and magazines – that still charges for content.
When Christos Lambrakis offered me the job in 1999, the Athens News was known as a venerable 47-year-old beacon of free speech whose founder, Yannis Horn, had become the first newspaper publisher to suffer imprisonment under the colonels’ censorship law in 1972.
Normally when a new product appears it thrives off the curiosity factor for a couple of issues before settling into its true circulation furrow. The weekly Athens News did precisely the opposite. Its first edition sold 4,331 copies in Athens and Peiraieus, its second 4,517, its third 4,862 and its fourth 4,947 – an average rise of 4.5 percent per edition. Sales across the country also rose in these weeks, signalling that we had overshot reader expectations.
- Lowering overheads: Newspaper publishing is a highly leveraged business. It involves enormous up-front expenses in printing plant, distribution networks, adequate newsroom staffing, contact-building and marketing. We managed to lower payroll expenses, which were under our jurisdiction, but not shared corporate overheads for services such as legal and accounting, which were beyond our control.
- Creating new revenue streams: Large-circulation weekly papers are now in the business of selling magazines, CDs and DVDs with news as an added virtue; hence the practice of obscuring the front page titles with the giveaways - the news is no longer the point. Those gifts are being sold at cost (each disk costs about a euro in rights and production, which is added to the cover price). The benefit is in maintaining circulation in order to remain competitive and sell advertising. So the print news industry is essentially becoming a branch of the entertainment industry with a news flavouring.
At the Athens News we lacked the circulation to make such a system profitable, but we also wanted to remain in the news business. The revenue streams we created were a line in book publishing, which had obvious economies of scale with newspaper publishing; and we were in the process of creating a revenue stream through a paid online subscription. (Mysteriously, both the Athens News' former publisher and its present one have eliminated the online archive, which is one of a newspaper's chief assets).
Shifting to a subscriber distribution model: With the inexorable, industry-wide shift away from news-stand sales, publishers have to hold on to their readers. The best way to do so is to enter into direct communication with them, pass on the economy of cutting out the distributor, offer gifts and draw direct feedback.
Below-the-line marketing: Few print media can afford the scattershot methods of television and street advertising to find their readers. Extracting needles from haystacks is best done by holding a magnet over them – in other words, organising events designed to draw out of the social mix a particular profile of reader. At the Athens News we did this through our anniversary, our book presentations, focus groups and tie-ins with other community organisations. We also made the most of free or low-cost publicity through the internet and our friends in the community.
- Integrity: In the ever-more crowded field of self-observation, humanity is becoming confused about what to observe and which observers are credible. A newspaper's most important investment today, over and above marketing, payroll strength, paper and printing quality and advertising, is in its own strength of character. People will remain loyal to the media that demonstrate a loyalty to them. At the Athens News our loyalty was always to the reader first.
The country is awash with newspapers that consider the reader a close second priority to the business-to-business deals made between the publisher and members of the government. In such deals, the newspaper sells image-making services for state advertising, state protection and state contracts. The journalists who serve such newspapers are fully aware that their paymaster's interests will dictate the next day's front page, not the beat reporting done by them. We are so steeped in this kind of journalism that we barely notice it. But it is a flawed business model. Publishers who did well in the blackmail business in the 1980s have come and gone, or shrivelled beyond recognition. In any case, no-one, not even the government, can take a publisher without integrity seriously. The newspaper that establishes a consistent record of independent and objective reporting and analysis will ultimately win.
New Europe on print media.
Wednesday, 21 October 2009
Where New Democracy undertook no new initiatives in five and a half years in power, Pasok is beginning to create a new momentum. As Alternate Foreign Minister Dimitris Droutsas told parliament on October 16, “We are going to change the way in which Greek foreign policy is conducted. Our aim is for Greece once again to … be a bearer of initiatives; to seek solutions; to make proposals.” This sort of enterprise diplomacy had all but died.
Standing before the Cypriot parliament on October 20, Papandreou brought Greece back onto the offensive, defining Greece's role as reminding Turkey that it has an interest in a successful reunification of Cyprus.
Monday, 12 October 2009
Wednesday, 7 October 2009
Prime Minister and Foreign Minister: Yiorgos Papandreou
Vice-president of the government, with particular responsibility for the Government Council on Foreign Affairs and Defence and the Committee for Economic and Social Policy: Theodoros Pangalos
Minister of the Interior, Decentralisation and E-government: Yiannis Ragousis
Deputy Ministers: Dinos Rovlias (Athens), Theodora Tzakri (Thessaloniki)
Minister of Finance: Yiorgos Papakonstantinou
(Deputy Minister: Philippos Sahinidis)
Sunday, 4 October 2009
The political challenge for Papandreou is threefold: to balance the budget and pay down the national debt; to make the economy more competitive and reverse the high trade imbalance; and to introduce greater transparency, accountability and meritocracy in public life. He has promised to do it all. Difficult though they are, the tasks cannot be separated because lack of progress in one area would undermine the others.
Saturday, 19 September 2009
Pasok and New Democracy platforms compared
New Democracy and Pasok have both made some sweeping and, in a few cases, radical proposals.
Both are broadly in favour of greater transparency and accountability in the public sector. Both want to bring the public debt under control by striking at tax dodgers and through better economic planning (three-year rather than one-year budgets). Both want to increase economic competitiveness, for instance by making it easier to set up a company. Both want to give secondary school students free laptops.
Sunday, 6 September 2009
“Right now we have big political differences with Pasok,” said Prime Minister Kostas Karamanlis at a press conference in Thessaloniki on September 6. “It hasn't recognised that there is a deep crisis. Second, it has no plan. Third, it has adopted a very accusatory rhetoric towards the government while sweet-talking voters. We know the crisis. We articulate it. We know what needs to happen to deal with it. We are prepared to take bold decisions to face it. There aren't the objective criteria for a coalition.”
In written responses to Sunday Eleftherotypia, socialist leader Yiorgos Papandreou cited the crisis as well. “We believe people will prefer a strong, independently sovereign government at the present time,” he wrote. Like Karamanlis, he rejected collaboration on the basis of incompatibility. “There is a clash of two views of our society and country. One view is self-serving, assimilating public wealth for private gain... the other is a belief in a Greece based on values.”
Saturday, 5 September 2009
This time it is also the inaugural speech of an election campaign for a third term, and comes as the worst international financial crisis in 70 years really begins to bite into the Greek economy.
Given these circumstances, the speech outline distributed by his office is disappointing. Rather than unrolling a platform of new initiatives to stimulate the economy, send green projects into hyper-drive, protect the environment and bring the expensive deficit under control, Karamanlis is largely repeating last week's speeches.
Karamanlis plans to summarise his policy successes and predict a difficult two years ahead. He will repeat the three-pronged recovery strategy announced on September 2, namely reducing public spending, collecting due taxes and making structural changes to the economy. This will leave reporters only the Sunday morning press conference to glean more policy specifics in these critical areas.
Thursday, 3 September 2009
Prime Minister Kostas Karmanalis' declaration of snap elections on September 2 hardly came as a surprise, though. Ever since he reshuffled his cabinet in January, many political commentators have opined that it was his battle formation for an attempt at a third term. This was mainly because he purged the cabinet of anyone with a lingering connection to the Vatopaidi scandal, and ditched then-finance minister Yiorgos Alogoskoufis, who had associated himself (unforgivably, it turns out) with fiscal discipline. The question was whether Karamanlis would hold the general election around Easter, or simultaneously with European Parliament elections in June.
Prime Minister Kostas Karamanlis' decision announced late on Wednesday did not come as much of a surprise. The government's reputation has been ebbing almost since it was elected to a second four-year term just two years ago. A series of economic scandals last year followed by the economic crisis took their toll, but also weighing heavily against the conservative New Democracy party has been its environmental record.
Forest fires in 2007 destroyed record acreage; both then and again last month, they denuded the smoggy capital of its main sources of oxygen. The socialist opposition had vowed to trigger elections next March, when New Democracy would need bipartisan support to re-elect the president. so Karamanlis decided that despite trailing in the polls, he will move the fight up to a month from now.
The reasons Karmanlis himself gives are sound. The country cannot flail in an electoral frenzy between now and March if economic measures are to be taken that set the foundation for a long-term recovery two years from now. He cited three main areas: Shrinking government (which is responsible for two thirds of Greece's national debt), tightening up tax collection and restructuring the economy in key areas.
Karamanlis did not go into details, saying he will fill in the specifics at the Thessaloniki International Fair on Saturday September 5. The devil is clearly in those details. Shrinking government is something no government has taken on wholesale; tax evasion is what keeps many employers in business; and restructuring the economy must include a painful pruning of the social security system socialist and conservative governments shied away from in 1992, 2001 and 2008.
But the race is clearly on; Papandreou is expected to answer with an electoral policy platform on Thursday September 3, meaning that his appearance at the TIF, like that of Karamanlis, will be an official campaign launch.
To hear the related NPR report, go to
Wednesday, 2 September 2009
All that remains of the van, police say, is an axle. The blast blew out the windows of the multi-storey building and caused damage to neighbouring buildings. A cleaning woman was lightly injured by flying glass 500 yards away. Despite internal damage to the stock exchange offices, the exchange announced it would operate.
There has been no claim of responsibility yet, but a local terrorist organisation called Revolutionary Struggle attempted to blow up a Citibank building in similar fashion in January. On that occasion the intended bomb was a car trunk full of petrol and fertiliser.
The Citibank plot was foiled because a night guard saw Revolutionary Struggle parking the car, went out to talk to them and was told to leave the building because he would be killed. He had the presence of mind to call the police, who defused the bomb.
But from that point on it became clear that Greece was making a qualitative leap in terrorism. The old model of targeted shootings against businessmen and foreign diplomats 17 November had stuck to for 27 years (1975-2002) was over. Greece would sooner or later experience a Timothy McVeigh-style Oklahoma City event. Thanks to a tradition, for want of a better word, of seeking grassroots popularity and not claiming unintended victims, Revolutionary Struggle is at least avoiding Oklahoma City-level casualties. But Once you start planting vans full of explosive on the street, an unintended victim is only a question of time.
Friday, 28 August 2009
The fires that struck Attica last weekend have resulted in millions of euros' worth of damage - and a heavy political price tag, too.
Greece's public works ministry says 65 homes were completely destroyed by last weekend's wildfire east of Athens, and a further 143 partly destroyed. The blaze tore through more than 2,000 hectares (200,000 stremmata or 50,000 acres) of pine forest according to a preliminary tally by the Word Wide Fund for Nature (WWF) after the fire service lost control of what had begun as a small fire on Friday 21 August.
The fallout is now threatening the government's stability. The leading opposition socialist party has called the ruling conservatives genetically incompetent, and says it will force an election next March; that's when the conservatives need bipartisan support to elect a new president.
Unless the government makes progress in protecting the environment as well as surviving the economic crisis, its days could be numbered.
To hear my reports, as well as other news, go to www.npr.org (click on Hourly News).
Thursday, 27 August 2009
The pilot was killed in the Katelios area of the island after he steered his single-seater aircraft over the fire, and made his drop. Authorities cannot yet explain why he steered into high voltage power lines as he lifted.
The Polish-built Petzetel aircraft he flew carried about a tonne of water treated with fire retardant, and was originally designed as a crop duster. Greece owns a large fleet of these planes, converted to firefighting use, because they are quick off the ground and very manoeuvrable. They are meant as a first line of defence, dousing fires while they are still small.
But it is a dangerous business, because pilots must fly low to the ground and cannot always control the aircraft's behaviour after discharging the enormous weight of water they carry.
"He was a very good man, he had done a great deal for Kefalonia," said prefect Dionysios Georgatos. The Katelio fire, which had threatened homes, had successfully been put out, he said.
Greece lost two pilots to a similar accident in 2007. They were experienced pilots flying a new Canadair aircraft over fires in Evoia. After dropping their six tonnes of water they experienced the usual uplift, but in this case it was followed by a sudden drop. As they were operating at very low altitude, they had no time in which to lift themselves by using their engines.
The Petzetel was one of nine aircraft fighting three separate fires across Greece. The other two were at Aspro Horio, on the island of Paros, and Karystos, in Evoia.
You can hear my radio reports at www.npr.org (click on hourly news).
Tuesday, 25 August 2009
A helitanker picks up water from a purpose-positioned municipal tank off Pendeli Square on Sunday 23 August. At least two such helitankers buzzed around the squafre like angry wasps, dropping two tonnes at a time on fires that threatened homes under the canopy of the pines.
Monday, 24 August 2009
It is less sexy, but closer to the truth. On Saturday the fire service spokesman referred to the fire as a “natural disaster”. That same afternoon Karamanlis visited the fire service's operations centre and simply emphasised the self-sacrifice of the men and women in uniform. Later that day he called for calm. On Sunday, visibly weary, he simply said that “the situation continues to be difficult.” No blame was apportioned, no witch-hunt for a conspiracy of arsonists begun.
No one seems to want to comment on who, or what, started the fire. Instead, mayors and community leaders in the stricken areas are raking the government and fire service over hot coals (no pun intended) for what they see as tardiness and sloppiness.
The leader of Grammatiko, Nikos Koukis, where the fire started on Friday night, says the battle could have been won if air drops of water had taken place early on Saturday morning: “The fire… could have been contained if air drops had happened by 6:30, 7:00 or even 7:30 on Saturday morning,” he told The New Athenian. “These drops did not happen, the fire spread into a thickly wooded ravine and spread in an hour to Varnavas and in about two hours to Marathon.” Other locals gave similar descriptions of the fire service losing the battle in the small hours of Saturday. The moment is critical. It was the last chance to contain a conflagration.
The people of Grammatiko have also drawn a connection between the fire and a landfill being constructed near their town. Police have had to be stationed on the road to Mavro Vouno, where the landfill is being prepared, since July 6. Their role is to stop vandalism or burning of the excavators and bulldozers working at the site, after numerous threats.
The only real connection between the landfill and the fire seems to be that the fire began at a point called Pyrgathi, about 300 metres from Mavro Vouno, where the landfill is being built. Koukis thinks the police, who would have been among the first to spot it, could have done something to stop the fire, or at least alert him. (In the event, he was informed by the community leader of neighbouring Varnavas about half an hour after the fire service was informed).
Koukis goes far enough to voice a conspiracy theory: “There are rumours that this was not accidental but an attempt to overcome the reactions of locals [to the landfill], who say 'this is a paradise and why do you want to bring us the landfill here?'” The theory is a little far-fetched, perhaps, but it is a response to those who accuse of local activists of realising a threat to burn out the excavators.
The tit-for-tat accusations over the landfill are a measure of the passions for and against the landfill that has been imposed by court order on this idyllic community. The enmity between police and the local community even after the fire is an example of a heinous lack of coordination between authorities even to avert disaster. How can we protect a natural heritage no-one owns if we are willing to cut off our noses to spite our faces?
Sunday, 23 August 2009
This is the main complaint made by residents to media, since they are usually the first to notice new fires while they are still small. Aware that the fire service is caught in a triage process, devoting assets only if their situation worsens dramatically, they have taken to beating the flames with branches and spraying them with garden hoses wherever they can, assisted by volunteers.
Still, the fire service seems to have picked up its rate of response through the day, indicating that it may have broken the back of this devastating fire that began on Friday night. For example, fires were extensive in Pallini and Pikermi, just east of Athens, on Sunday morning, whereas the response time was faster in Agios Stefanos and Kaletzi by evening, resulting in smaller burnt areas.
Agios Stefanos, a few kilometres northeast of the city, flared up in the middle of the day but was out by about 4pm. Kaletzi, about 15 kilometres northeast of the city, was reported to be flaring up around that time, but by 630pm it was out, having burnt only a few acres of trees.
I saw the ease with which wood re-inflames itself off Pendeli Square, in the eastern suburbs. Fire reached the front yards of houses off the square in the middle of the day. It nestled in some piles of dead wood in an untended plot and jumped from there to the branches of a large Aleppo pine.
A fire truck put it out once, followed by a municipal water tanker a second time. It reignited yet a third. It was left to a few young men and women with buckets of water and branches to carry on the fight.
One of them climbed a ladder and took a saw to a flaming branch. It was too thick to cut. Another climbed up with a bucket of water and doused the limb. But it was a small victory in a small yard. Around the volunteers smoke filled the air and helitankers circled overhead like angry wasps in an orange sky, a reminder that the size of this task requires superhuman machinery.
Much of this machinery has been mustered, leading to a new high in resources at hand: The fire service reported 162 fire trucks, 70 tanker trucks, 14 water-bombing airplanes and seven helitankers in operation in Attica on Sunday. The fire service had 650 men in the field, and army hundreds more. This buildup may have played a key role in allocating resources to fires quickly enough to prevent them from becoming unmanageable.
Co-ordination seemed to be another problem. Residents on Pendeli stood in the doorways of their houses and flagged passing tanker trucks and fire trucks like taxis. These vehicles did not seem to have specific instructions. They patrolled and stopped randomly to spray a flareup here or there, and seemed amenable to instructions from locals.
The armed forces say they have been actively involved putting out fires, not merely patrolling burnt areas. I saw them with bladders on their backs which were connected to spouts for spraying, and platoons with shovels and pickaxes were also deployed.
The pine forests of eastern Attica have been devastated. Thousands of acres on the southern, eastern and northern slopes of Mount Pendeli lie blackened and smoking. Around Marathon Lake, considered by generations of Athenians a spot of particular beauty, the forests are gone.
Some fronts remained active by evening in Nea Makri, Mount Kithairon and the area of the ancient site of Rhamnous. Should they burn until nightfall removes aircraft from operation, there is a chance that they could present the fire service with a new challenge on Monday.
Inevitably after these fires people argue about how they started and whether the fire service strategised its response well. But the key question is what is being done to prevent them. Why forest floors are not cleared, dead wood cut away from trees and networks of early warning heat sensors installed in the forest are the questions the government has to answer.
The entire region between Pallini due north to Anthousa, Drafi and Pendeli has been burned in the second night of the Grammatiko fire which started on Friday night. It has travelled about 40 kilometres from Grammatiko due south and east, burning almost every tree stand and all shrubland in its way.
The landscape is lunar. Pine forests lie charred down to the stumps - around them foliage burned to reveal blackened stones. Here and there smoke billows out of holes in the ground and there are frequent minor flareups.
Seven-force winds have been the key to this fiery onslaught. Many houses were saved precisely because the wind urged on the fire so fast that it hadn't time to digest homes. But anything lying outside garden walls – trees, power pylons and rubbish dumpsters - was devoured.
Many local residents had spent the night protecting their homes. On Sunday morning they were still doing what they could to put out small fires near their homes, beating them with olive branches and shovels, or forming human chains to relay buckets of water filled using yard hoses. The air was thick with acrid smoke, and people were covering their faces with T-shirts, kerchiefs and towels to work. Many had come to help friends and relatives. Occasionally the siren of a passing fire truck could be heard, but the fire was so widespread that many people didn't expect one to stop for them.
Despite 600 firefighters, 132 fire trucks, dozens of tanker trucks, 12 Canadair water-dousing planes and seven helitankers, foreign aid has had to be called in. Two Canadairs were due to arrive from Italy; another four were due from France and Cyprus.
The fire has been advancing over Pendeli mountain, a posh eastern suburb. By 1pm it had reached Pendeli's main square, and an evacuation order was given. A helitanker flew low over the square, dousing flames that leapt just a few dozen yards away. The smoke in places was so thick that visibility was only a few yards. Tanker trucks patrolled the main Pendeli road spraying down flareups in the pine stands that survive. The frequency of fires on this mountain has been great in recent years. Much of the growth now burning is only about four feet tall – not old enough to seed another generation.
Many Pendeli residents were waiting until the last moment to evacuate their houses. The roads were still lined with parked vehicles in late morning. Many people were waiting outside their homes, faces covered, their dogs beside them on leashes. From the invisible depths of the smoke explosions were audible – natural gas tanks, perhaps, or cars exploding.
Saturday, 22 August 2009
The fire is eating its way through thick pine forest and shrubland. Houses and farmsteads have been burned, but no-one knows how many. Television images suggested that outlying houses in the town of Grammatiko itself were about to be licked by flames 10 metres high.
Firemen fought hard to douse a blaze in Magoula north of Athens yesterday. But a tally of the resources brought to bear gives an idea of the scale of this fire: At the height of operations today, 78 fire trucks supported by 32 tanker trucks, 12 Canadair water-dousing planes and eight helitankers along with a total of 260 men were losing this battle badly.
The sky over Athens told the whole story. Half was azure blue and cloudless, as nature meant it to be on this day. The other half was an evil mixture of charcoal-black opening to brown, so thick that it eclipsed the sun.
Summer camps and homes have been evacuated, with many people suffering from smoke inhalation. No casualties are yet officially reported. Even the army has retreated from a base in the area, no match for the seven-force gusts that are the key to the strength of this fire.
As we go into a second night of the blaze, it is unclear whether the fire fighters will be able to bring greater resources to bear on Sunday. Sixty fires started across Greece on Friday, another 65 on Saturday by late afternoon. With such tallies the fire brigade has to keep assets spread far and wide in anticipation of other potential disasters. Add to this the fact that a windy night favours fire because aircraft cannot operate in the dark. It is safe to say that dawn will reveal a very different eastern Attica to that which we knew until last week.
Monday, 17 August 2009
Take growth. The original 2009 budget predicted a rather gallant 2.7 percent, down only slightly from last year's 2.9 percent. The European Commission suggested in January that 0.2 percent was more realistic. Incoming Finance Minister Yannis Papathanasiou revised his predecessor's estimate to 1.1 percent in February, and revised it again in June to “around zero”.
First quarter GDP growth was just 0.3 percent, year-on-year, and second quarter growth was -0.2 percent.
It seems highly likely that Q3 will also run negative. It is heavily dependent on tourism, responsible for an estimated one fifth of the economy. The Bank of Greece announced a drop in January-May travel receipts of 17.9 percent as compared to last year. The key industries of shipping, construction and domestic retail are also suffering.
It now appears that 2009 GDP as a whole will be negative. The International Monetary Fund, which last spring had agreed with the Commission's estimate of 0.2 percent growth, published a revised estimate earlier this month of -1.7 percent. The Organisation for Economic Co-operation and Development (OECD) also thinks the Greek economy will contract, by 1.25 percent.
The deficit is another area of statistical disagreement. The original 2009 budget optimistically forecast that revenues would fall short of expenditures by a mere two percent of GDP this year. The European Commission opined 3.5 percent in January, later revising it to five percent. In a biannual survey of Greece released on July 31, the OECD said that Greece will top six percent of GDP in borrowing this year, rising to 6.75 percent next year. The IMF on August 6 predicted deficits of 6.2 percent and 7.5 percent of GDP this year and next.
Who is closer to the truth? Papathanasiou, or the OECD and IMF?
Greece has, for the second time since joining the euro in 2002, incurred the EU's Excessive Deficit Procedure. It has been given until October to come up with a radically revised Stability and Growth Plan. That plan must explain not only how Greece will contain expenses; it must also put in place a programme of structural changes that will cut the public payroll, improve public education, save social security from bankruptcy and make healthcare viable. Until that plan is made public in October, along with the 2010 budget and Q3 results, we are unlikely to know how the Greek government really sees things.
There are early signs that the government is coming around to international pessimism. Papathanasiou told reporters on August 4 that he may ask the EU to extend its 2010 deadline for bringing the deficit under three percent of GDP by a year. A three-year plan had been his original preference, and his return to that position is a sign of lost optimism.
But Papathanasiou also argues that gloomy predictions ignore a windfall of 5.7 billion euros' worth of Public-Private Projects (PPPs), which it will fast-track now after years of bureaucratic wrangles. It also claims it will front-load the programme of EU-funded infrastructure projects, which is worth 24.3bn euros over seven years. Fine, but can the government pull off what it promises?
Greece also claims that international predictions ignore the parochialism of its economy. It is not export-driven, and the forecast 19.2 percent decline in its exports this year (IMF) will affect it less than they would, say, Germany; its banks are not heavily invested in toxic assets; and more than half of its workforce is employed by small and medium-sized enterprises (companies of fewer than 20 employees) rather than multinationals. These points are all true, but they can only limit damage. They do not replace lost growth.
There are also some counter-arguments. The IMF and OECD point out that Greek banks' heavy investment in the Balkans means they are exposed to nonperforming loans there due to economic slowdown and currency discrepancies. And as Bank of Greece Governor Yiorgos Provopoulos warned earlier this year, Greece will suffer from underemployment as opposed to unemployment, so the statistics may be misleading as to the extent of the social damage.
Most importantly of all, the challenge for Greece is not weathering the crisis but recovering from it. Many economists think it can only do so with structural reforms in social services and by lowering public expenses. These are reforms the European Commission, the IMF, the OECD and the Bank of Greece have all called for. So has a chunk of the Greek electorate.
Just as the recession has come to the Greek economy with a delay factor of a few months, so will the impetus for reform as a result of that recession; but come it shall. Press reports suggest that Prime Minister Kostas Karamanlis and Papathanasiou are planning to announce a restructuring programme in the autumn. The socialist opposition will probably attack it, bent on elections. Voters will have to keep their ears open to the argumentation on both sides. Who embarrasses whom in this debate will be important.
Monday, 10 August 2009
Sunday, 2 August 2009
The socialist opposition, Pasok, has thrown down the gauntlet by declaring that while it supports Papoulias on substance, it will trigger a general election by not voting for him next February. Papoulias is a Pasok former foreign minister who enjoys enormous popularity, so Pasok leader Yiorgos Papandreou's position has raised eyebrows. The 151 ruling conservative MPs would need to build a two-thirds majority (200 MPs) to elect him in two voting rounds, or a three fifths majority (180 MPs) in a third round.
If New Democracy fails to garner the votes, article 32 of the constitution allows for a further three voting rounds under a new parliament, which means a general election. Given Pasok's recent lead of anything between two and five points in the polls, it expects to win either outright or as senior coalition partner. After that, Pasok says, it would re-elect Papoulias in a fourth round (again requiring 180 MPs), a fifth round (requiring 151 MPs) or a sixth round, which selects the stronger of two candidates.
New Democracy did this once before, in April 1990, deliberately triggering the fall of an ecumenical government to assume one-party rule and elect its elder statesman, Konstantine Karamanlis, as president. The difference is, New Democracy did not state its intention.
Is Pasok being refreshingly candid or is it abusing the constitution? Greece's top legal scholars have argued both ways.
Athens University's Yiorgos Kasimatis, who was involved in drafting the 1975 constitution, is of the opinion that a party can only reject a presidential candidate on the basis of his character and suitability (interview in To Paron, July 12). Panteion University's Dimitris Tsatsos agrees (interview in Kathimerini, July 19). Both think that Pasok is abusing the constitution; but their criteria are as much political as legal.
Kasimatis advised Andreas Papandreou to remove the presidential power of dissolving parliament in the 1986 constitutional revision. That removed the biggest threat to the dominance of the executive. Tsatsos is against the election trigger that remains in article 32, which allows an opposition party to undermine the parliamentary majority. (Presidential elections have, since 1975, always taken place between general elections, and have therefore loomed over every democratically elected government). In other words, both Kasimatis and Tsatsos hail from an a priori position that parliamentary democracy must be as unfettered and functional as possible.
Athens University's Nikos Alivizatos takes a different view. He does not think that Pasok is abusing the constitution. He thinks that the clipping of presidential power in 1986 left the opposition veto as “the only institutional counterweight to the excesses of prime-ministerialism. In other words, the only check on what [Alexis de] Tocqueville called 'the tyranny of the majority'.” (Interview in Kathimerini, July 26). Like his colleagues, Alivizatos interprets the constitution using political as well as legal criteria. He does not believe parliamentary democracy needs to be strengthened but balanced, and describes the Greek polity as “the most centralised parliamentary system in Europe.”
Alivizatos has previously argued for creating a judiciary counterweight to executive power. He favours stripping the cabinet (effectively the PM) of the authority to appoint the presidents of the Supreme Court, the Council of State and the Court of Audit, the country's three highest courts, and allowing the judiciary to produce its own leaders. Other constitutional experts share Alivizatos' suspicion of concentrating so much power in the hands of the ruling party. The late constitutional expert Yiorgos Papadimitriou, for instance, supported giving parliament's Audit Committee, made up of politicians and senior judges, more sweeping authority to investigate the finances of politicians and parties.
The public dialogue among experts has not answered the question of whether Pasok is acting unconstitutionally, but it has opened up the larger question of whether the constitution is flawed.
Five years of conservative rule have proven Alivizatos right in political terms. New Democracy's impressive track record of financial scandals indicates the need for authorities independent of the body politic. Where those authorities have existed, New Democracy has abolished them to protect itself. Who can forget the disgrace that was the abolition of the independent authority against money laundering last year, just as it was about to produce a damning report on bonds the conservative government issued in 2006? Suggestions have now been made that the government's greatest source of power, the budget, be taken out of the political realm and drafted by an independent financial authority.
Even without New Democracy's appalling lack of transparency and accountability, though, the Greek system is far too centralised. In a non-presidential system, where the executive springs from and controls the legislative branch of government, one set of checks and balances is already done away with. In the absence of a bicameral parliament, another set is done away with. When MPs vote the party line and party leaders are given power over the judiciary, it is difficult to see where dissent will come from except from the back benches, and we have a weak backbencher tradition.
So who will be the government's conscience? The media are a flawed court because the preoccupation of newspaper owners is often to leverage corporate benefits from the system rather than to foster a tradition of objective journalism. As Alivizatos points out, we do not have universities and think tanks wealthy and independent enough to speak truth to power. At times, it seems as though the 1975 constitution did away with vasilevomeni dimokratia (monarchic democracy) only to introduce a self-styled dimokratiki vasileia (democratic monarchy). Like the frogs of Aesop's fable who asked for a king to replace the log in their pond, we have received a stork.