GREECE:With deficit targets that will be missed and an election looming, Greece is beset with uncertainty
THE BODY language at meetings of the Greek cabinet tells us much. The diminutive figure of interim Greek prime minister Lucas Papademos is dwarfed by the two Pasok “heavies”: portly finance minister Evangelos Venizelos, and the even more portly Theodoros Pangalos.
The latter is famous or, perhaps more accurately, infamous for two pronouncements: in 2010 he proclaimed "mazi ta fagame" – "we all squandered the money" – referring to the misuse of government funds; and in 2011 he stated that, on a declared annual income of more than €600,000, he could not pay the €7,500 property tax for which he had been assessed (on his 57 properties).
The prosperity of Pangalos and Venizelos occasions derisive jeers in the kafeneion (local bar), but it also provokes doubts about the so-called government of national unity, as it includes the main former opposition party New Democracy – which many commentators criticise for being both in government and opposition at the same time.
While many applaud Papademos because he is a technocrat and not a politician, others decry the fact that he has no popular mandate: he was put in place by the EU and IMF.
He was also economics adviser to his predecessor, George Papandreou, for a year before his appointment as prime minister, suggesting that this remains a Pasok-led government, with Pangalos and Venizelos as the prime minister’s minders.
If Pangalos and Venizelos could see the despair on people’s faces (as widely reported in the national and international media), they would not continue to talk about “sacrifice” in the way that they do.
People queue to hand in their car number plates because they cannot afford the 2012 road tax. With incomes dropping all the time, they dig into their savings, especially the elderly, who try to keep their children and grandchildren afloat. In the past year, the number of registered pawnbrokers has almost doubled, as people on the brink of destitution sell family heirlooms – the trade in gold jewellery is one of the few growth industries.
More distressing still is the prospect that the general election, which is likely to be held in April, will result in a stalemate, with another coalition of uncertain composition taking power.
Neither of the major parties enjoys sufficient electoral support, suggesting that a range of smaller parties, each with its own agenda, might prolong the uncertainty regarding Greece’s future in or out of the euro zone – and even in or out of the EU.
Media comment, meanwhile, is shrinking, with the bankruptcy of private television channel Alter and Eleutherotypia (Free Press), the second-largest national newspaper.
Voters, particularly in rural areas, view Pasok as having reneged on its promises: the rising tide lifted all boats, until the tide receded to the horizon. “Pasok is no longer a socialist party,” says my village neighbour. “They no longer look after the poor people.”
Pasok, with an approval rating of 15 per cent, could face meltdown at the polls, especially because of its internal split between traditionalists and Europhiles.
My neighbour points to the tax increases on tobacco and petrol, the 9.2 per cent rise in the price of electricity, and the withdrawal of the subsidy on heating oil (which, in Athens, has resulted in the management companies of many apartment blocks refusing to fill the central heating tanks). The emergency property tax is being unevenly applied; originally applicable to 2011 and 2012, it has now been extended until 2014, and many doubt if it will be rescinded.
My neighbour pays no tax, because the rents for the property he owns are – rather predictably – paid in cash. But those whose income is ascertainable – either because they are public servants or because they pay tax online – are now subject to another emergency tax, to pay the unemployed because the government cannot otherwise afford to do so.
At the Ionian University in Corfu, a tenured professor’s salary has been reduced over the past two years from €21,500 to €15,600, which, according to official statistics, puts him on the poverty line for a couple with two children. More than 20 per cent of the population is “at risk of poverty” – that is almost 600,000 households and 2.2 million people.
Another lecturer, untenured, who was working for the minimum monthly wage of €700, was told he would now be paid €130 a month for a 12-hour week. He resigned and is now teaching at a private school in Athens for €30 an hour, while his erstwhile students in Corfu are left without a teacher.
Papademos has warned that the next few months will be crucial for the country’s future. His task is to keep the coalition together so that budgetary targets are met and administrative reforms, such as the deregulation of “protected” professions, are carried out – both of which are prerequisites if the next bailout is to be achieved.
One target is the creation of 150,000 jobs in the first quarter of this year. But it is already admitted that the planned reduction in the budget deficit will not be achieved, and the unemployment rate is rising, not falling. It is a litany of “tax, tax, tax”. Young people are doing everything they can to find a way out. The upcoming elections are viewed with utter cynicism. There’s a word for it: sperectomy, the excision of hope.