Change begins from within

Posted on February 20, 2012, 8:26 pm
7 mins

On February 20th, 185 years ago, the Greek National Assembly elected Giovanni Capo d’Istria as the first governor of the fledging new country in 1827 in the middle of fraternal fighting that had been going on since the War of Independence. He was the most illustrious and internationally well-known Greek of that time. He was given the impossible task to organize a very poor, divided, illiterate population into a modern state. He’d inevitably had to break the clan system of kapetaneoi and kotsabasides but this conflict resulted in his assassination by the Petrobey family. Soon after his death, the foreign protectors of Greece decided that the new state would be better off with a foreign king as the local population was deemed too immature and fractious. That notion of foreign tutelage had many domestic supporters too.

Since Kapodistria’s time, Greece has turned to foreign powers several times, because of internal problems that were beyond the domestic leadership’s ability to solve them. Is this the ugly truth no one wants to hear today? The draconian measures the lenders are asking Greece to impose, as Paul Krugman argues, are based on the wrong tools to get a country out of severe economic crisis—but this is another story. On the other hand, however, if the borrowers didn’t want any money, there would have been no harsh measures imposed by the foreigners.

Indeed, the lenders and some European leaders are asking Greece for “an arm and a leg”, but the present troubles of economic mismanagement began as soon as Greece entered the European Economic Community (later EU) and elected Andreas Papandreou to government in 1981. All Greek governments since that time share the blame for the current suffering. All the major political parties also stoked the consuming fire of corruption, inefficiency, and economic plunder.

Let’s be honest here. It’s not the European leaders who forced Greece to buy their expensive weapons that led to this catastrophe. Some of those leaders, surely, they want something advantageous for their own countries. Yet, this is the crux of the matter: The better your financial record, the better the terms of a loan you can negotiate. Puting your hand out all the time weakens your bargaining power. Add to this the wasting of the money received, while the domestic economic output cannot meet the outlays, and you have a disaster in the making. Surprisingly, it lasted 30 years during which time many opportunities for reform were passed by.

At some point you cannot refuse a bailout, because you have no other choice. Going bankrupt or leaving the Eurozone, (even if all debts are forgiven), still leaves you with a huge budget deficit. Your expenses far outweigh your income. As long as this is the case, there are no easy solutions. Without a bailout you probably have a more severe crisis. How are you going to pay the salaries [including paying the salaries of the largest land owner in Greece!], pay for defense, import goods, maintain the infrastructure, and import gasoline? If you produce most of what’s needed, then no big problem, but if you have no more cash and no credit what do you do?

Did Greece act as a junkie—totally dependent on foreign aid, often “cooking the books” to get it, while being incapable of weaning itself off the addiction in the last 30 years? Wouldn’t the situation be different today had that money, plus the earnings from the domestic economy, been put to good use, with reasonable investments for the future? What did it? Going on a spending binge—from SUVs to the Olympics—and consuming more than the country’s earnings did it.

Greeks are not any more lazy or more prone to corruption than anyone else who claims sainthood—they just adapt to the conditions of a particular system in a given country. Same for everybody else. Yes, the paedia matters too, but most of the time a person performs according
to the means available and to his needs. Therefore, it’s not in the nature but it’s in the nurture. Systems are constructed with a mission statement in mind and are implemented by people, not gods, in a historical period with local and international events affecting the outcome.

The mission statement of an advanced country is to improve the quality of life of its citizens. Citizenship denotes privileges, benefits, and a social contract. On the other hand, there are certain obligations, one of which is the effort to thoughtfully participate, and to accurately evaluate reality, because decisions are made by popular will which is the ultimate authority in a mature democracy. People wanting to believe something that makes them feel good is not necessarily synonymous with assessing reality. Solutions come only after the real roots of the problems are identified and there’s a strong will to implement a correcting course.

PS> Kapodistria’s historical period is worth a read. There are certain themes frequently recurring in the last two centuries of the modern Greek state. The nature and role of the Greek political parties have the roots in that period. The three main parties of that era were the British, French, and Russian. No kidding.

A self-described Athenian, works and lives in the NYC metropolitan area. Interested in the world of ideas, the human condition & history, and how public policy can foster a progressive culture of life.