“In September 2011, at a time when the sovereign debt raiders, as some people call them, were focusing on Italy as their next target, the European Central Bank sent a letter—supposed to be secret, but it was leaked. And in this letter it gave very direct instructions, you could say, to then prime minister Berlusconi about privatization, lowering pensions, changing hiring and firing, regulations and laws—all things one would think should be the outcome of the political process within Italy. So what is this about banks telling countries how to govern themselves?” —Paul Jay, The Real News Network
Following is a video and my abridged transcript, with added subheadings, of Paul Jay’s interview with Gerry Epstein, codirector of the Political Economy Research Institute (PERI) and Professor of Economics. The content of the transcript focuses exclusively on the words of Gerry Epstein.
Central bankers in Italy and Greece doing bidding of large banks – overruling democratically elected governments, privatizing public services, privatizing water, gutting labour protection laws, cutting public pensions
We have this trend now where instead of democratically elected governments controlling these countries, so-called technocrats, the central bankers, are coming in, taking over as the prime ministers of governments in Italy, in Greece. In Italy we have Monti, and in Greece we have Papademos. These are supposed to be neutral arbiters of economic policy, but in fact are mostly doing the bidding of the large banks. And the other European countries, especially Germany, they want austerity.
And what’s amazing to me about is they’re going way beyond any kind of narrow policies with respect to debt repayment, monetary policy. They’re going into the deep core of social and economic policy in many of these countries. And that letter from the European Central Bank [to prime minister Berlusconi telling him to make deep reforms], went to the highly contested issues that have plagued Italy for many years about labor laws, privatization, and many others.
In Italy, the letter from the European Central Bank to the Berlusconi government said, you have to pursue privatization of public services. And this includes water, privatization of water. And, in fact, just months before, there had been a referendum in Italy about privatization of water, and the voters had rejected it. And now the so-called independent technocratic European Central Bank is coming in and telling them to overthrow what the people have decided and engage in privatization.
Another important goal of these kinds of so-called technocratic policies is to gut labor protection laws. In Italy there are strong protections for—in terms of hiring and firing. And what they’re trying to impose are these so-called labor flexibility, with the idea that this is going to generate more economic growth and more employment. But as David Howell from the New School for Social Research, Dean Baker, and others have shown, labor flexibility does not lead to more employment and more economic growth; it just leads to lower wages and higher profits.
Well, [public pensions] are such a big issue in Europe because for two reasons. One is it’s a big liability of the government, and so there is a big—a high degree of budget impact on that. But the second is trying to undermine the power of labor and forcing workers into the hands of the banks. So if you reduce public pensions, not only do you make it so that workers have to take any job they can get to support themselves and work longer, but it also gives more room for private pension plans. And as we know from the debate over privatizing Social Security here in the United States, that’s been one of the long-term goals of finance. Indeed, the general push of all of these policies is to gut the welfare state as much as policy and return all of these kinds of protections to profit-making opportunities for banks and other private companies.
Orwellian language being used to obscure what is really going on – e.g., “fiscal consolidation” is doublespeak for gutting public services and generating unemployment
Part of what is so evil about this whole approach is the transformation, the distortion of language that is part of it, the use of the term technocrat to hide the fact that Trichet, that Monti, Draghi, all of these people have very, very close ties to the big banks. Most of them worked at one time or another for Goldman Sachs or other big financial firms. We have the same kind of thing, of course, in the United States, where we had Larry Summers, who works for the financial sector and makes millions of dollars doing so, being put forward as a quote-unquote “technocrat”. We have the Federal Reserve that has engaged, as you know, in all kinds of backdoor bailouts of the financial sector again seen as sort of a technocratic solution, but we see the revolving door between the Federal Reserve and the private financial sector, using the term fiscal consolidation for gutting public services and generating unemployment. All of this is Orwellian language, which is meant to obscure what is really going on, which is the takeover of democratic control, which, as you said, is already undermined by money, and putting it firmly in the hands of the financial sector.
Bankers’ anti-democratic policies “infantilize” the people
In The Financial Times, there was an article recently talking about the profile of Papademos, the prime — the technocratic prime minister there, saying that he was heading up a caretaker government, you know, as if the Greek people are a bunch of infants and they have to—we have to wait till they can grow up and exercise their democratic rights.
“There’s a great need for the left forces in all of our countries to really unite to oppose these kinds of policies”
Part of the frustrating thing is that these kinds of elite pushes to control these democratic systems are possible because the left is so divided in the European countries, and divided here in the United States as well, of course. Part of the left in Italy, for example, didn’t protest when this letter came out, because they were so focused on just trying to get rid of Berlusconi, and they’ve accepted Monti as a prime minister because they were just so happy to get rid of Berlusconi. So I think there’s a great need for the left forces in all of our countries to really unite to oppose these kinds of policies. We have to break this whole lock-hold of anti-democratic structures that have been built up by the elites under neoliberal policies over the last 20 years, so that once we have more democratic elections and vision, we actually have the ability to implement them.
Fair Use Notice: This blog, Citizen Action Monitor, may contain copyrighted material that may not have been specifically authorized by the copyright owner. Such material, published without profit, is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues. It is published in accordance with the provisions of the 2004 Supreme Court of Canada ruling and its six principle criteria for evaluating fair dealing.
Where are the stories about how life is going to get better? We’re in for years of discontent
No 418 Posted by fw, February 22, 2012
“What makes the headlines are, of course, the riots. What doesn’t make so many headlines is what is happening to real people… We are living in a time where the world has, in the last couple of years, erupted in a way that many people thought they would never see again since the 1960s… The underpinnings of this new global unrest are that…people are sick of seeing the rich get richer during a crisis.” —Paul Mason
The above passage is from a Democracy Now interview with Paul Mason, economics editor of BBC Newsnight. He has just returned from Greece. His latest book is called Why It’s Kicking Off Everywhere: The New Global Revolutions.
A 20:16-minute video of the interview is embedded below along with my abridged transcript featuring abundant sub-headings to facilitate browsing and selective reading of this lengthy post. Alternatively, to view the video and access the complete transcript on Democracy Now, click on the linked title.
(Note: all the following passages were spoken by Paul Mason unless otherwise noted)
Greece is beginning to look like a borderline developing world
What doesn’t make so many headlines is what is happening to real people. I was able to visit a clinic in the Piraeus port. It had been set up to deal with people who fall through the social security net, which is mainly undocumented migrants. So it was volunteer doctors and free healthcare and free food. That’s about as basic as it gets. In the last six months, they’ve been swamped by Greek citizens, because they—Greek citizens are falling through the safety net in a Europe that is supposed to be—well, what Americans think of it as quasi-socialist. It has a welfare state. And yet, we’re seeing those starving people and homeless people, huge numbers of drug addicts and homeless people on the streets. It looks and begins to look really almost borderline developing world, parts of Greece now.
Regardless of the bailout package just agreed to, Greece is on a sure path to default. It’s just a matter of when.
Well, look, you would like to believe that they could win, they could beat all odds and stay in the euro and avoid default. But up to now, every one of the failed bailout packages was signed off by the IMF and the E.U., and they all involved meeting, you know, the Greek problem with austerity. So you cut spending, you raise taxes, you impoverish people. Leave aside the minimum wage, wages in general are going to have to fall 15 to 20 percent to meet—in the private sector. This is no longer just a public sector thing. Now, I think, and most analysts think, that they are on a route to default and that the last week’s—or this week’s deal has basically been about ring-fencing the rest of the eurozone for if and when that happens. Having been there, I think it’s when.
When people are told “Your future is over”, there’s no way a stable government can emerge to do what it has just committed to do
And then there’s, on top of that, the whole question of political instability. You mentioned left-wing groups in your introduction. I think there’s a bit—in the mainstream media, there’s a bit of a “does not compute” going on. The combined vote, for the communists, Trotskyists and ecologists—so these are left-wing parties with hammer and sickle on their flags—is 43 percent right now in the polls. That dwarfs the equivalent of the GOP and the Democrats. And I think there’s an element of “We don’t want to see that.” But that is what you get when people are told, you know, “Your life is—your future is over.” There’s no way, I think, from any early election, that a stable government can emerge that can do this thing they have agreed to do.
This parliament will pass the measures but growing instability will ultimately defeat the plan
On the question of the parliament, I think, certainly, they’ll pass the measures. What’s happening, though, is the two parties—because these two parties are there from the last election three years ago, so they have a majority right now, even though their popularity is slumping. I think, as they pass them, more and more MPs are chipped off. And these two parties in power splitting is not great, if they then stand for elections, and their own members get to ask them, “Well, what are you going to do about this?” During an election, pressure goes on the mainstream parties as well as the ones at the extreme. And, of course, the right as well as the left is growing as a result of this crisis. And remember, this is a country that had a civil war between the right and left after World War II. So, I think that that’s that on that situation. I think it’s—they’re just not going to be able to make it work. The instability is going to bring down the plan. Or it’s 90 percent certain, in my mind, that the instability in Greece will just—you can’t push through this level of austerity with a weak government.
<START VIDEO CLIP OF MASON’S INTERVIEWS IN GREECE>
PAUL MASON: As the crisis deepens, the weakest and the poorest suffer, nowhere more so than those who are not supposed to be in Greece at all. This is Patras, the ferry port that links Greece to Western Europe. Right on the seafront, hundreds of illegal migrants live in this shattered factory. I am taken in by an activist from a local NGO. The migrants got here because government cutbacks have made the Greek border highly porous.
PAUL MASON — How easy is it to get into Greece?
WASSIM – How easy? It’s too easy.
PAUL MASON – It’s too easy?
WASSIM – Too easy.
PAUL MASON – Why?
WASSIM – Why? Because, you know, the borders are not closed; the borders are open.
PAUL MASON – They survive on charity. They receive no assistance at all from the Greek state. But as the economy has collapsed, so too has sympathy for the migrants.
WASSIM – You know, this is no Europe. Believe me. This no Europe.
PAUL MASON – It doesn’t feel like Europe?
WASSIM – No, no.
PAUL MASON – Why?
WASSIM – No, I used to live London. This no Europe. Believe me, this no look like Europe. The police can hit you. The people can swear you, for no reason. The people hit us like animal. What’s the life there?
PAUL MASON – <Turns to another man> This man, a graduate from Darfur, is headed for London. He can’t wait to see the back of Greece. How long have you been in this factory place?
ABDUL AZEEM – In the [abandoned] factory here, I have six months, and three months in the train there.
PAUL MASON – Yeah, you lived in the train.
ABDUL AZEEM – Yeah, before we came here, because the police forced us to leave the train. Then we came here in the abandoned factory. I have six months here.
PAUL MASON – Do you think the economic crisis has made the situation for migrants worse?
ABDUL AZEEM – Yes.
PAUL MASON – Why? Tell me.
ABDUL AZEEM – We are going to the market, so I think that—
PAUL MASON – They give you some food at the end.
ABDUL AZEEM – Some food, some—also there’s some money, you know.
PAUL MASON – And less. There’s less now.
ABDUL AZEEM – Yeah. Now the situation is changing, because of the economic crisis.
PAUL MASON: They drink from a pipe in the ground. Some have died from fires lit to keep warm. It’s shocking to see this in a continent that once prided itself on a social model. But the crisis has turned so much of Greece upside-down. For Greek youth, the situation too looks dire. Fifty percent of those under 24 are unemployed. And among them, the extremes of politics are growing.
In a bar run by one of the far-left groups, Mason meets the people who’ve got together to feed and clothe the migrants. None is actually a member of a left party; all intend to vote for one. And all have been participants in disorderly protests.
KATIA ZAGORITOU – There’s no future for us. Generally, there’s no future. We can’t dream. We can’t live. For us, this is a disaster.
PAUL MASON – But I’ve been hearing young Greek people say that to me for three years now. What do you do about it?
KATIA ZAGORITOU – We’re fighting. We’re trying to convince other people and to make them understand that all this crisis is a result of the capitalist system.
PAUL MASON – Do you seriously think there could be a left-wing government in Greece?
ANTONIS DIAMANTOPOULOS – I don’t think it’s going to be a nonviolent government from the left. It’s going to be a civil war.
PAUL MASON – The carpenter, the teacher, the engineer, the social worker—these are professional people. But the ideas they’re espousing have become commonplace. And what it’s about is work. There isn’t any.
EIRINI PAPADOPOULOU – If there’s no work, there is a revolution against the government.
<END CLIP>
There are similarities between what’s happening in the US, Southern Europe, North Africa
We are—you know, we are living in a time where the world has, in the last couple of years, erupted in a way that many people thought they would never see again since the 1960s. And I think the Greek events—I mean, Greece isn’t all riots. It’s Occupy camps. There you had one of the first ones, called the indignados camp, in their main square. In Europe, across southern Europe—you know, I think only me and Glenn Beck have been talking about this, in a way. I have seen the crossover, the potential crossover, from North Africa to southern Europe to the United States, and the similarities between what is happening. I take a more—a sort of more sort of standing above it standpoint than Glenn does.
We’re in the age of “graduates without a future”. There’s a lot to be angry about
But it’s—there are links. There are common factors. And the most important one, everywhere, is what you saw in that bar, what I call the graduate without a future. You find them on Tahrir Square. You find them in Syntagma Square, Greece. You’ll find them outside—you know, in Zuccotti Park, New York. Once the economic crisis switched off that narrative that things are going to get better, you’ll have a better life than your parents, I think people in the Middle East lost their fear, people in Europe and America have lost their apathy. And there’s a lot to be sort of angry about once you look at real life.
In his drive though the southwestern USA, Mason found American middle class people living in a homeless encampment in Albuquerque
In my book, I’ve—one of the chapters in it is where I drive from Oklahoma to L.A., following the route that Steinbeck’s Joad family took. There was a drought in Oklahoma last summer. I thought, well, let’s just drive along 66, or parallel to 66, and see what it’s like now. It’s stunning, what you find. I think much of the mainstream media misses this. One of the most amazing things was to find a homeless encampment in Albuquerque, which, of course, was set up—again, there’s always this parallel—for people who maybe had drug and alcohol problems. But now, what do the people running it say? The people coming in are the American middle class, people who have been running a branch of McDonald’s, holding down a decent managerial job, two weeks later, homeless, jobless and sleeping on the floor with 80-odd people they don’t know.
<START VIDEO CLIP OF MASON AT HOMELESS ENCAMPMENT>
PAUL MASON – Normally, the families who come here are coping with drink, drugs, domestic violence. But now there’s a new kind of customer: the American middle class.
LARRY ANTISTA – I’m Larry Antista. This is my daughter Michelle. We’re here because of the economic times. My spouse took off on us, and that cut our income in half, and we lost our place. And here we are.
PAUL MASON – They’ve been living like this for three months. He’s a truck driver by trade, but he can’t find work. So he works for his welfare payments: $300 a month. Michelle, aged 14, is still at school.
Do the people at school know where you sleep every night?
MICHELLE ANTISTA – No, not really.
PAUL MASON – You don’t tell them?
MICHELLE ANTISTA – No.
PAUL MASON – Why?
MICHELLE ANTISTA – They didn’t ask, so I figure, don’t tell them.
PAUL MASON – So you don’t show up as homeless even in the school statistics?
LARRY ANTISTA – No.
MICHELLE ANTISTA – No.
PAUL MASON – Do the sort of rich of America, really—and the media, really understand that every night thousands of people are bedding down like this?
LARRY ANTISTA – No.
MICHELLE ANTISTA – No.
PAUL MASON – What would you say to them, if you could speak to them right now?
MICHELLE ANTISTA – If they could live just like one day of, like, our lives, they’d see how hard it is and, like, how good they have it. Because a lot of them complain about what they got, which is really dumb.
<END CLIP>
The Greek bailout is a way of protecting the banking system
It’s hard not to see the Greek bailout as a way of protecting the European banking system. It’s hard not to read that report as, yet again, a decision to bail out banks and bankrupt countries, because don’t forget this: the financial markets at the moment are focused on Greece and Europe.
Greeks today. Americans next because you’re $14 trillion in debt
At the moment that is solved, they will focus on your country, because you are $14 trillion in debt, and there are—there is doubt about whether your institutions can one day deliver the austerity that those financial markets will demand to make that debt stable.
Where are the stories about how life is going to get better? We’re is for years of discontent
So I think, look, that the underpinnings of this new global unrest are that from Cairo to Greece to New York to Albuquerque, people are sick of seeing the rich get richer during a crisis. That’s what they’re sick of. And until we start hearing solutions, both at the grassroots level and at the top level in politics, that go beyond that, that explain to us what the new story is about capitalism, these unrests, these revolutions, the unrest, the protests, I think, will go on, because it is about a generation that doesn’t know what the story is anymore. What is the story about how my life is going to get better? Once you do that, and then you add in networking and technology and the ability to express oneself and move around the mainstream media, you’re in for years, I think, of discontent.
Greece is in a death spiral. It shows what can happen if you lose control of your debt
Nobody believes the most optimistic scenario. I mean, look, they’re in what economists call a death spiral. So, the economy is shrinking, and the debt is getting bigger. Of course, Greece has had a big debt write-off, and that is tangible. That’s real and material, and it will be welcome. But as they try to implement the austerity, I think most observers think they can’t do it. And if they did, it will produce a deep recession that will make the lives of the people I saw on those streets very angry, very dislocated from politics, even more harsh, and they will get even angrier, if not despairing. Some are already beyond the anger stage. Some are in a state of just individual despair. Greece is an extreme, an outlier, but it does—of course, it does show what happens if you let your debt get out of control. It also shows what happens if you think—if you only see austerity as the solution to indebtedness.
RELATED READING
Forbes review of Paul Mason’s new book, Why It’s Kicking Off Everywhere: The New Global Revolutions
Fair Use Notice: This blog, Citizen Action Monitor, may contain copyrighted material that may not have been specifically authorized by the copyright owner. Such material, published without profit, is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues. It is published in accordance with the provisions of the 2004 Supreme Court of Canada ruling and its six principle criteria for evaluating fair dealing.
“The situation really is just one of going day-to-day and just trying to survive”
No 410 Posted by fw, February 16, 2012
In the embedded 10-minute video below, Greek Canadian Dimitri Lascaris speaks of his experience and his family in Greece. Dimitri opines that the best solution for Greece would be to reject the austerity deal, pull out of the Eurozone and devalue its currency. A transcript follows the video. And below that is a letter of despair from Dimitri’s sister in Greece. To view the video and read the original transcript on the TRNN website, click on the linked title below.
Paul Jay — When we see pictures of buildings burning in Athens, police and protesters, we hear debates about austerity and stimulus and such, it all seems a little bit abstract. What we don’t often hear about is the very personal suffering of people who are under this severe austerity regime.
Now joining us to talk about his experience and his family in Greece is Dimitri Lascaris. He’s a lawyer. He’s called to practice in New York and Ontario, Canada. He was a securities lawyer. He’s worked in New York and Paris for a major Wall Street firm. He’s acted on behalf of the country France. He’s worked for Greece. He’s worked for German development bank and numerous cross-border security offerings. He’s now a securities class action lawyer based in London, Ontario. And I should add he represents investors and not the banks. Thanks for joining us, Dimitri.
And for full transparency here, Dimitri’s law firm is doing some pro bono legal work for The Real News as we sue people who have stolen our stories. But Dimitri, you’ve been on the phone with your sister, who was in Canada, is now living in Greece. What has she been telling you?
Dimitri Lascaris — The stories that she’s been telling me are becoming increasingly dire. You know, she was raised here. She was educated at the University of Western Ontario in Ontario. She left Canada in the ’90s to marry a young Greek gentleman who lived in a village of about 1,000 people about an hour from Athens. And they since had four children. And when she arrived, Greece had not yet joined the euro. The euro didn’t exist. It had the drachma. And life there was not as prosperous, not as comfortable as it was here, but there was a certain degree of stability and security, and overall, you know, in many ways a superior quality of life, from her perspective.
You know, her husband had, at the time, a carpentry business, which he wanted to grow. And he decided to do that by investing a very large proportion of the family’s wealth in German machinery, which he brought back at great expense to the family to Greece. And for a while his business was thriving. And then came the Greek financial crisis. Since that time, my sister describes—there’s been a steady deterioration in the family’s quality of life.
The first thing that [unintelligible] was is in Greece families are very dependent upon private tutoring. The marketplace has always been—for jobs has been always quite competitive, and parents try to prepare their children to enter a difficult workforce. Of course, now it’s become much more difficult. They couldn’t afford to have tutors, so they got rid of those. Gradually their clients stopped being able to pay. Getting a client to pay even 5 percent of an outstanding balance was quite a stretch, because the clients were of course having to deal with their own debts. Many of them began to rely upon credit card debts to meet the basic necessities of life. And so the family’s revenues largely dried up.
Then there was an infiltration of crime, violent crime, into her village of about 1,000 people. One day she was—very recently, as a matter of fact, she was attacked outside her door by a drug addict and her money was stolen. She’s been to the funerals of two friends from the village who were killed by assailants who were desperate for money. The family now is basically dependent upon assistance from other family members. She knows of people in her own village who have to scrape by with whatever the pensioners in their own families are able to give them. And the situation really is just one of going day-to-day and just trying to survive at this stage.
Paul Jay — And what’s your sense from talking to your sister and other people, you know, that you have connection with in Greece about what they want? Do they want out of the eurozone? And they’re kind of caught between a rock and a hard place, but it’s going to be hard whatever they do. So what’s your sense of what people want?
Dimitri Lascaris — Well, people, I think, have had enough of austerity. There’s no question of that. I think there is widespread and quite bitter resentment towards the European elites, and particularly the government of Germany. I had occasion to go to Greece myself in November of last year because my grandfather, who lived a very long life, suffered a stroke, and I wanted to be with him towards the end of his life. And I sat in a hospital room with eight other patients, with my grandfather, and they had a little television over his bed that everybody watched. And the room was largely silent one day, and Angela Merkel came on the screen, and there was just an outpouring of hostility towards, you know, the German chancellor. And I think people there have had enough of austerity.
But at the same time, there is a very significant reluctance even still—and it’s quite remarkable—to abandon the euro. And I think that that really is—my own impression is that that’s a function of the indoctrination of the population by the Greek political elite. They’ve adopted the Hank Paulson mantra, you know, that if you were to depart from the global financial system or the financial system, the architecture that’s been established in Europe, then of course an apocalypse will ensue. And people, they fear the unknown. But I think the lessons of past defaults and currency devaluations tells a different story. And to my mind the future of Greece really lies in a withdrawal from the euro and a return to the drachma and the reestablishment of national sovereignty, because that is being eroded at a dramatic rate on a daily basis.
Paul Jay — Well, speaking of national sovereignty, one of the provisions in the new deal the Greek government made with the European finance and political elite just a couple days ago calls for much more privatization. They’re talking about airports and seaports, and previously they’d already been talking about things that had been tourist sites and islands. What seems to be on the chopping block? And what’s your reaction to it?
Dimitri Lascaris — Well, certainly the government is talking about selling infrastructure. It’s talking about selling the national telephone company, which was something that was resisted for a long time. Basically, anything that can generate revenue, I think, is potentially at risk of being sold to private investors in the current environment. And what’s really most troubling is that it’s being done in circumstances where the government has very little leverage. And what is likely to ensue, and in fact what is unfolding, is a fire sale of national assets. And at the end of the day, people will look back at what’s transpiring today and will say that they were sold out, actually betrayed by their leaders, the most important of whom isn’t even elected by the people, Lucas Papademos.
Paul Jay — Now, you were involved earlier—and I read your resume a bit—in some privatization that took place in France. So why is that different than what’s happening in Greece now?
Dimitri Lascaris — I was working in Paris in the ’90s, and at that time, the French government, I think, was much more conscious of maintaining national sovereignty, was much more progressive in nature. And so the privatization schemes that the government pursued at that time were much more modest. And rather than selling majority stakes and surrendering control over important industries to foreign investors and other private investors, the government was selling minority stakes and only doing so on a very targeted basis.
What’s going on here is really of entirely different scale. I mean, it really is just a broad-based fire sale of national assets from every sector of the economy. And what’s going to be left at the end of the day, if anything is left, is a rump of national sovereignty and a loss of control over people’s destinies in Greece.
Paul Jay — Now, if Greece were to pull out of the eurozone, the argument goes that it would be just a sinkhole, that without these loans, the Greek economy would completely collapse, even though it’s not like—not that what’s happening now is good, but it would be worse. So how do you envision that would work?
Dimitri Lascaris — Well, first of all, the Greek economy has collapsed. The Athens News reported today that the GDP in 2011 experienced a record annual plunge of 7 percent. It’s the fourth consecutive year of a deepening recession. Unemployment rates amongst youths have surpassed, I understand, 50 percent. The general unemployment rate is in excess of 20 percent. There was a rumor the other day that ATMs in Athens were empty, were running out. There are stories appearing in reputable media outlets that people are abandoning their children in the streets. I mean, it’s really difficult to imagine a more horrific situation for the populace.
What needs to be done is a currency devaluation. And within the eurozone, Greece does not have the ability to achieve a currency devaluation. And so what is being imposed upon the Greek people is a ruthless internal devaluation. The wages are being eviscerated and people are being impoverished. And at the end of the day, when, you know, what you’ve created basically is a large pool of extraordinarily cheap labor, you’re going to see a race to the bottom in the broader continent, in my view. And eventually these policies are going to find their home in the heartland of the eurozone, in France and in Germany. And really what would be best is for Greece to withdraw and to engage in a currency devaluation to enhance its competitiveness by that means rather than by brutalizing the population through vicious wage cuts.
Paul Jay — Thanks for joining us, Dimitri.
RELATED READING
The following is a letter from Dimitri’ssister in Greece:
Dimitri…the decline in our income and therefore in many facets of our lives began in the fall of 2009. In our family carpentry business, we began to go without work intermittently, but for longer and longer stretches as time progressed. Customers who owed us large amounts of money couldn’t pay even 5% of the balance owing on their account. Our customers of course gave priority to the payment of bank loans they had incurred as first-time homeowners or for the expansion of their businesses, or worse, they gave priority to the payment of credit card debts they had incurred in order to maintain the quality of their life, or simply to secure the basic necessities…rent, water, electricity, health insurance and food. Slowly, cash has became more and more scarce
for our customers, and therefore for us.
In Greece, the baby boomer generation has placed tremendous emphasis on education. In a very competitive job market, Greek parents sought to equip their children to secure a job as a civil servant. For that purpose, Greek parents commonly employed ‘frontistiria’ (or supplementary education through tutoring) as early as the onset of elementary school. The need to eliminate the financial burden of tutors was one of the first signs that people were struggling to survive.
Now, in 2012, whether in a city or a village, all you see strolling the streets is a succession of empty storefronts with rent signs and often a deluge of unopened mail just inside the door. The few businesses that have managed to stay open have gigantic banners proclaiming 50-70% reductions, hoping to catch the eye of the few potential customers out there. Walking through what used to be crowded and bustling markets now feel like a Sunday stroll through deserted urban centers.
Going to take care of business at The National Bank of Greece was once an all-day affair…most often now, you can zip in and out in less than 5 minutes. On the other hand, the line-ups to make payments at the Greek electrical company have become longer and longer. There you find very volatile crowds of people fighting with employees to defer payments through payment plans, or to have their electricity reconnected after having had it cut off as a result of the “haratsi,” which is a government property tax incorporated into the electrical bill, often
quoted by legal experts as one of the many unconstitutional acts this government has committed. What right does the electrical company have to assume the role of a tax collector, and to deprive us of electricity when we become unable to pay the arbitrary taxes issued at the drop of a hat to generate more money for the EU and IMF?
Suicides, drug abuse, prostitution and crime have infiltrated village life. In our village, which has slightly more than 1000 inhabitants, I was a victim of theft by a drug addict just outside my front door. I have been to the funerals of two friends who were murdered here in the village by their assailants when they were unable to produce money on demand. Other friends of ours have died of heart attacks, stressed to the limit by debt, or worse, the loss of their cars and homes.
We, as well as many people we know, are experiencing a strained home environment as a result of financial difficulties. Now we call our customers to beg them on a regular basis to pay something, anything, toward the debts they owe us, because food or heat in the dead of winter has become an issue for us. We now rely on help from family members. People we know go to retirees in their families to ask for contributions from their meager pensions. We are all now at the mercy of anyone with money at hand to help our family survive, let alone aspire to a better life.
At almost 52, when your stamina and endurance have started to wither away, life feels like a chore. However, children have a way of making you ‘plug’ back into life, even if it’s only to focus on just one more day.
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