A year of the new Greek coalition government.
Over a year ago, in a different incarnation of this blog I wrote a post about the multitude of things I saw going wrong in Greece. In the meantime, Greece went to two elections (technically an election and a repeat election), and a new government coalition was sworn in on June 20, 2012 under a new prime minister Antonis Samaras. Today marks the one year anniversary of that government, so I feel it’s time we take a look at their record.
Let’s start with everyone’s favorite subject; the financial meltdown and the memorandum. The terms of the memorandum in broad strokes state that Greece can alter the requisite policy measures as long as the fiscal result of these new proposals is equivalent. This provision gives Greece enough flexibility to effectively dig itself out of this mess, or shoot itself in the foot. In the past year the greek government seems to favor the second option.
I’ve argued before for a simplified tax code and more expediate rulings in cases of substantial tax evasion. There quite literally are billions owed in back taxes to the greek state. The government could chose to go after these people expediently. It could simplify the rules that it uses to do this, and it could set a strong precedent with that and make the life of other tax payers a bit easier. Instead, what we got are more taxes. Novel taxes that would seem absurd in almost every context and are paid by the same people who have demonstrably done their share of shouldering the collective tax burden.
Christine Lagarde, the head of the IMF, handed the previous finance minister a leaked HSBC list on the premise it could be used to pursue tax dodgers. No action was taken on that list from the previous regime - in fact knowledge of that list did not become a matter of public concern until a greek reporter decided to go to print with it. What happened after that? The current coalition government, which largely consists of members of the previous regime spent a lot of time trying to cover their collective ass. And they legally went after the reporter, twice.
Other targets of government intervention were indirect taxes, on commodities like gas. The end result of this was a lot of lower income households struggling through winter, and ironically reduced income on these commodities for the government. Apparently our finance ministry never heard of the Laffer curve. Other interesting government interventions supposedly motivated here where a restructuring of the already ailing public health system which seems to make it even worse according to everyone I talk to. Meanwhile, the mr Samaras, bemoans that more cuts are demanded of him according to the memorandum. The first thing in every problem is evaluation of its extent, and the proposal of some metrics. Then start weighing your options and so on. I’ve already mentioned that I believe a number of young greeks would take a voluntary redundancy scheme. No such measure has been pursued, and though some may find it hard to believe, there are well documented cases where this could have helped Meanwhile, there are public sector workers in Greece who have been suspended for years, or even imprisoned but are still in capacity considered as working for the state. If it’s job cuts that are demanded of greece, maybe this could help?
And here’s my main beef with the current government. From a very young age I was tought that people should lead by example. The government rhetoric has been trying to appeal to the public’s sense of responsibility. Make people own the burden their asked to pay. The government has not been doing the same. In their narrative everything has become part of the troika’s demands. And every single greek citizen is responsible. Where is the courage of mr Samaras’ opinion? He has most certainly been given enough leeway to implement what measures he sees effective. Why does he not take responsibility and own up to them? Then again, I suppose it’s very unlike a carreer politician to commit political suicide, even if it is for the good of the country the constantly profess.
And the list of boons from the last election are not limited to the greek economy. The last election saw the introduction of a neonazi party to parliament. A party that has physically acted on their vocal hate of anything that does not adhere to their standard of Greece. I will save a lot of words for another post on the neonazi Golden Dawn party, because I want to stay focused on the governing coalition. A government coalition which is more than willing to drink from the neonazi coolaid if there’s a vote in it for them. Something they’ve demonstrated time and time again when the national character is under attack, like immigration reform, or finally instituting a legal framework to address institutional racism in greece. Then again, as one of my favorite writers once said, I’m pretty sure they would skull-f*** theird dead grandmother if they thought there was a vote in it for them (thank you Warren Ellis for that lively picture).