Anastastios Pappas, Konstantine Foteinakis: "The Greek economy, society and environment in crisis"

Αγαπητοί επισκέπτες, 
Σήμερα αναρτούμε την έκθεση για την "Οικονομική, Κοινωνική και Οικολογική κρίση στην Ελλάδα"  που στείλαμε (23/4/2012) στη Διεθνή Περιβαλλοντική Κοινωνική Οργάνωση Naturefriends International. Την έκθεση υπογράφουν ο Δρ.Τάσος Παππάς  και ο Κώστας Φωτεινάκης (Πρόεδρος του ΟΙΚΟ.ΠΟΛΙ.Σ. και των Φίλων της Φύσης) και θα δημοσιευτεί σε εφημερίδα των Naturefriends στις Βρυξέλλες.
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The Greek economy, society and environment

in crisis.

23/04/2012

Dear Friends of Naturefriends International (NFI),

We are sending this letter in order to inform the Naturefriends International and the national networks about the current economic and social impact of the European debt crisis in Greece.

This opinion piece presents the opinions of the authors and it does not necessarily reflect the views of all the members of Naturefriends Greece.

Economic and social environment

Greece is undergoing the second year of an economic depression with severe economic and social consequences. Greece was dragged to a “Memorandum” (“mnimonio”) with European Commission, European Central Bank and International Monetary Fund (the “Troika”) in order to service its public debt which before the “crisis” was around 120% of its Gross Domestic Product. Today after the implementation of severe austerity measures and a debt reduction scheme (haircut) it’s public Debt as a percentage of its GDP is above 160%. This situation is combined with high and increasing poverty, unemployment and misery.

What went wrong? Economist and politicians from all over the world now see the deep depression and the debt overhang problem not as cause which drove to the memorandum but as a symptom of it. The austerity measures which are implemented by the Greek Governments following the guidelines of “Troika” are supposed to be necessary for the nation’s salvation. However our view is quite different….

Solidarity or speculation

During the last two years Greek people listen to Mrs Merkel, Mr Sarkozy, Mr Rehn, Mr Juncker, Mr Schäuble etc. that Europe shows solidarity to Greece by giving money. That money of course is not donation. They are loans, and indeed, with interest rate much higher from the interest rate that the European Central Bank is charging the European private banks for giving them loans. Another truth is that only 15% of “Troika’s” loans are going to the Greek Economy. The vast 85% repays old Greek debt which was allocated at the portfolio of private banks from all over the world. So what is happening the last two years is not the salvation of Greek nation but a huge bail-out of private banks.

The PSI and the haircut

Greek government some months ago celebrated the “great success” of the PSI, the “private sector involvement” to the Greek debt problem. The involvement refers to a reduction of the nominal amount of Greek public debt. In the banking jargon this is called a “hair cut”. Normally a “haircut” reduces the public debt burden and may help an economy under some conditions. Such condition is the transparency that this action has to be accompanied with. For the Greek haircut this is not the case. Additionally the haircut must be followed with a long grace period and a low interest rate in order to be avoided the accumulation of new debt. This is not the case either. There is no grace period and the interest rate is well above the market interest rates. Finally the haircut must be accompanied with measures that enhance a sustainable growth. For Greece not only these measures are absent but also the draconian austerity measures that have caused the deep recession are going to be continued. The fact that the haircut included the bonds of the Greek public pension and insurance funds, Greek hospitals, Greek universities and Greek individuals who placed their life-time savings to Greek Government bonds instead of a bank deposit make the situation even worse and the negative social consequences vast. Thus the haircut appears more than a communication trick rather than a true assistant to the Greek people given that Greek government received a new loan of 130 billion Euros.

Economic and Social Consequences

Numbers are revealing a dramatic situation in Greece both in the economic and in the social sphere. Greek people have on average lost about 35% of their real income the last two years. The official unemployment is reaching 20% -the unofficial is much higher- and unemployment is reaching 50% for the young people. Poverty is increasing dramatically with the official rate to be close to 30%, while the number of suicides has also increased by almost 20% compared to 2011.

Crisis and Environment

From the outburst of the crisis since now Greek people are blackmailed with various (pseudo) dilemmas. “Strong (neo-liberal) government or chaos”, “euro or drachma”, “austerity or default”, “less wage or unemployment” these dilemmas are presented from the media in an everyday basis in order to terrorize the Greek people. The only solution for the Greek people is to accept the bitter medicine in order to avoid death. However, in the end, the medicine will cause the death.

Accordingly similar dilemmas are presented related to the natural environment. “You want development or environmental protection?”. For the inspirers of the neo-liberal shock doctrines, growth and natural environment are conflicting concepts. Of course the growth that they envision has nothing to do with a sustainable development. It is the growth which pollutes, destroys the environment, reduces the wages and distributes totally unfair the income.

Such “growth” is trying to be implemented to the Greek economy. Several laws have been voted by the Greek government after 2010 which will have sever consequences to the Greek coasts, Greek islands, “Natura protected areas”, urban open spaces. Additionally some small steps that have been done the last decade for the environmental education are stopping suddenly. Ecology and environment in Greece is being hit as harsh as Greek people’s income. The ecological movement –the term ecological is used instead of environmental because it includes also the concept of the living standards- is now a necessity as a counterweight to the crisis. The cooperation and the coordination in a national and European level of the forces who dispute the neo-liberal and unsustainable growth model is necessary for the protection of the environment and the society. The Friends of Nature in Greece, despite the well known difficulties, will fight for the protection of natural and social environment by all means (legally, educationally, in movements).

The Future

We believe that Greece is the first experiment in Europe for the implementation of the “shock doctrine”. If the severe neo-liberal experiment succeeds in Greece other European countries will follow. If these policies continue probably in the future Europe will not be the Europe that we all know. We believe that this adverse situation which has hit Greece, but also other European countries is steaming from the fact that European Union is dominated by conservative governments and the financial capital. The European left, green even social-democratic view is quite different for both the causes and the solution of the European crisis. Only if the orientation of the European governments and European Union changes towards to a true soliditarity and sustainable development and a limitation of the power of financial capital, we can hope for a better future. We see our future in the European family. Not a family which dominates its children but a progressive, democratic and ecologic family. We believe to a Europe not for the money and banks but for the people.

Konstantine Fotinakis	Dr. Anastasios Pappas
President of Naturefriends Greece nfgr2007@gmail.com	Member of Naturefriends Greece anastasios1977@gmail.com