Ancient Greece Could Hold The Key To Solving Today’s Debt Crisis – By Michael Nevradakis

 

Ancient Greece is perhaps best known for its contributions to mankind in the areas of philosophy, architecture, and science. But a modern-day economist suggests that some of the economic practices that were used in ancient times could help to solve Greece’s current debt crisis.

A man waves a Greek flag in front of the Greek Parliament during a rally against new austerity measures in Athens, May 18, 2017. (AP/Yorgos Karahalis)

ATHENS (Interview) — Closing in on a full decade in duration, the Greek economic crisis is unprecedented in the modern history of economically-developed nations. During this period, Greece’s GDP has declined by over a quarter, unemployment has skyrocketed to record levels, salaries and pensions have been decimated and a significant percentage of Greece’s population, particularly its young university graduates, have migrated abroad.

Four separate memorandum packages that allegedly “bailed out” Greece have instead squeezed the economy to its limits through the imposition of harsh austerity measures, cuts, and privatizations even of profitable public assets. Meanwhile, most of the “bailout” funds, which are actually monies that have been loaned to Greece, have been routed right back to European banks, with very little of that money actually entering the Greek economy.

MintPress News recently spoke with economist and author Spiros Lavdiotis in an interview that initially aired on Dialogos Radio in two parts in May and June. Lavdiotis is a former analyst for the Bank of Canada and has written several books and articles on the Greek economic situation during the crisis. He has also extensively researched the economics of ancient Greece and the connections of ancient philosophy with modern-day economic challenges.


In this interview, Lavdiotis discusses austerity, the present-day Greek economic situation, the reasons why he believes Greece must exit the eurozone and the manner in which it can do so, while also explaining what ancient Greece can teach us about dealing with debt today. 

MintPress News (MPN): Share with us a few words about austerity as an economic doctrine, and how this doctrine developed.

Spiros Lavdiotis (SL): The modern form of austerity developed in the meeting of Toronto of the G20 [in 2010]. There was a split in the opinion, in that high-level meeting. The Americans espoused the principles of Keynesianism in trying to recover from the financial crisis of 2008, when the whole of the financial system collapsed, particularly after the bankruptcy of Lehman Brothers in September 2008. Together with the United States in espousing the principles of Keynes were India, Russia, and China. At the same time, the Europeans split from this idea. They thought that in order to save their own weak financial system, that austerity is the only way to do it.

The crisis that started in the United States with the subprime loans and developed in a snowball fashion, to a great extent it disseminated its waves to the European system, which was weaker than the U.S. system. [The fact is] that the eurozone does not have and is not built on sound principles. It is a legal construction which is incomplete because there is no political union, banking union, or financial union. There is no such thing, it was simply a “reverse creation,” starting from a legal structure of the monetary union, and then trying to instigate a political union. It’s very unusual, it’s never happened in the history of civilization.

As a result, when the crisis came, everything fell apart. They didn’t know what to do. In a bulletin which was issued by the European Central Bank (ECB) in May 2010, they admitted that they were in a state of complete collapse. They didn’t have any mechanism, nothing. So they tried to save themselves—particularly the Germans, who had the biggest exposure to the system, the German and the French banks. They decided not to apply Keynesian principles and to follow austerity.

Greek Prime Minister George Papandreou, right, welcomes the head of the International Monetary Fund Dominique Strauss-Kahn at his office in Athens on Dec. 7, 2010. Strauss-Kahn was in Greece to negotiate terms of the repayment of the three-year euro110 billion ($150 billion) bailout loan intended to saved the debt-ridden country from default. (AP/Thanassis Stavrakis)

Austerity is a dangerous policy because it means that a country has financial problems due to the budget and due to deficits in the foreign exchange, in other words in the balance of payments. In order to alleviate itself, it has to impose austerity measures. How does this work? The theory says, through “confidence.” What does “confidence” mean? The theory says that when people and investors see that there is stability and the country can be saved, then “confidence” is going to build. These are unbelievable things. That’s why the measures of austerity were called “friendly to growth” measures. There is no such thing! These things never work.

In Greece, they miscalculated the “multiplier effects” of the policies which they imposed on debt and incomes. As a result, the Greek economy collapsed completely. In the second year of the imposition of the austerity measures, in 2011, GDP collapsed by 7 percent. All these measures were called “reforms,” but were not reforms. They killed the economy, salaries, pensions.

I remind you that in Greece, 50 percent of the national income arises from pensions. It was a total catastrophe. The unemployment rate, from 7.8 percent, shot up to 28 percent, and it is still measured artificially at 23 percent. This is a dismal situation. People have no hope about finding jobs, and they immigrate. The immigration rate has surpassed more than 600,000 people, from which 250,000 are educated people with degrees who are unable to find anything decent [in Greece].

Overall, the GDP from 2008 until now has fallen by 28 percent. This is the longest, in time and magnitude, drop in growth in economic terms of any developed country. This has never happened before. Even in the Great Depression in the United States, unemployment reached 25 percent and it took only three years to start recovering.

 

MPN: Why is there such a great insistence on economic austerity, such as in the case of Greece, and are there any examples that you can identify where any country was able to emerge from a financial crisis and return to growth as a result of austerity?

SL: Not to my knowledge. Herbert Hoover tried to impose austerity, and in two years the situation was very severe. There is no such example in the history of economics. I do not know how they developed this type of “friendly to growth” austerity. This is unbelievable, this is a myth, there is no such thing. They have tried to save the financial system of Europe, which was collapsing, and at the same time Germany went ahead and accepted this because it wants to keep the European free trade zone intact.

As you know, there are only nine EU countries which do not participate in the eurozone. The main thing was for Germany to maintain the primacy of its export power. In order to do that in this modern era, you have to maintain the financial system following the principles of free trade, the three basic principles of the Maastricht Treaty: freedom of commerce, freedom of services, and freedom of labor, and of course that presupposes the freedom of capital.

The euro is based on irrevocable exchange. In other words, it’s not like the Bretton Woods agreement, [based on] the gold standard. If a country was in a fundamental disequilibrium, they could devalue up to 10 percent and get out more easily from the predicament. Now with the euro, you cannot. As long as you entered with an exchange that was determined then, that’s it, there’s nothing you can do. It’s like an iron chain, and if you cannot fit from the very beginning—as was the case in Greece—but the European Union knew that, that the Greeks were cooking the numbers.

But the Germans wanted to sell frigates and planes to Greece, the same with the French, and therefore they closed their eyes. They wanted to have Greece there, due to the fact that they could expand their own markets to Greece, due to the different economic and industrial development of the country while at the same time not having to be afraid of devaluation. That was the main goal of Germany.

At the beginning, Germany was exporting two-thirds of their products to European countries. Then it shifted and started exporting to Asia, with its biggest market being China. But just remember that even now, exports constitute 46 percent of Germany’s GDP. They had the power to institute this policy, and the Greek politicians decided to protect the banks. This was a mistake. There were always interlocking interests between the politicians and the banking system in Greece, but I think it was also ignorance, they didn’t know the extent of that relationship in passing the losses of the banking system to the Greek taxpayer.

The amounts are tremendous. They involve a sum of 240-plus billion euros. [By comparison], Greece has a GDP of 175 billion euros. You have a small economy producing 175 billion euros [of economic activity] and you transfer 240 billion in banking system losses that have nothing to do with the Greek economy, this is close to 150 percent of GDP. This would be the same as a $25 trillion bank recapitalization in the United States.


Related: How Greece Became A Guinea Pig For A Cashless And Controlled Society


The United States can still print money though, but in the eurozone, all the countries have to give up their monetary sovereignty. It was given to the EU, where in effect you had only one institution, the ECB, and therefore you are transferring all the rights of creating money to one institution which then, in order for you to have money, they will [fund] you by charging interest, but not directly to the member-states, only to the banking systems. The state, to finance its expenditures and the coverage of all programs for health and for welfare and whatever expenses were necessary for the state, had to borrow.

And to borrow from whom? Because the ECB does not directly lend to states, it had to borrow from the private sector, and the private sector had to borrow the funds from the ECB, which was charging interest. The commercial banks then had to charge extra interest to lend money to the Greek state. What happened then? The Greek state had to charge taxpayers with higher taxes to cover these expenditures. Greece entered the European Monetary Union in 2002. By 2008 we were already bankrupt, but they simply did not announce it to the public.

Internationally they did not know that the problem of the Greek state was mostly the banking system. They were talking about “corrupt Greeks.” Yes, there were corrupt Greeks, and the politicians are very corrupt in Greece, this is acknowledged, but the politicians never behaved in placing the common good ahead of themselves.

Right now we are faced, according to the latest budget, with more than 563 billion euros—which is the sum of all of the debt that occurred due to all the banking losses which entered the Greek budget—because there is no fiscal union in Europe.

 

MPN: “Seisachtheia” is a concept that many are not familiar with. It is also the topic of one of your books. Tell us about this ancient Greek concept and what it may teach us about debt today.

SL: There are a lot of similarities with what happened then, in the 6th century BC, in ancient Athens, with what is happening now. Back then, ancient Athens was in a great economic ordeal due to the fact that the wealth of the city was accumulated among the richest people, and the richest people of that period were landowners. They charged interest between 16 and 36 percent for those who did not have money and wanted to borrow money.

If an agrarian wanted to cultivate the fields, which were all owned by the landowners, they either had to pay one-sixth of the gross cultivation to them as a rent, or they had to go and borrow at the aforementioned rates. Eventually, it was impossible. If there was a bad crop one year, how could they give the one-sixth to the landowner? Therefore they had to borrow and they were going bankrupt.

In this Feb. 2, 2016 photo farmers stand behind a makeshift fire in front of tractors, near Kerdilia, Greece. Combine a rapidly aging population, a depleted work force and leaky finances and any country’s pension system would be in trouble. For debt-hobbled, unemployment-plagued Greece, it’s a nightmare.(AP/Giannis Papanikos)

At that time in history, it was not instituted to give land or other items as collateral. You were placing as collateral your own body, your wife, and your children. So if you were unable to pay, the debtor was given the right by law—not only in Greece but in all ancient regions, including Asia Minor, Sumeria, and Iraq—to be captured and sold as a slave. A famous site for slave exchanges at that time was the island of Aegina, just outside the port of Piraeus.

Solon was the highest official elected by the Athenians to solve this problem, because they were evacuating, just like right now the Greeks are evacuating Greece because they cannot find jobs. This is a very serious situation here in Greece because there isn’t even unemployment insurance. They say there is, but right now there are more than 1,200,000 people officially unemployed, and they pay unemployment insurance for less than 10 percent. And what kind of unemployment insurance? Its 260 euros per month, and only 10 percent [of the unemployed], or 117,000 people, get unemployment insurance.

This is the European system, which exists because there is no law or regulation or principle within the EU, particularly in the eurozone, which gives a right to work. While in the United States the Federal Reserve law says that all monetary policy will be in accordance to maximum employment, price stability and low long-term interest rates. The constitution, according to the Maastricht treaty, of the ECB says there is only one goal, and that goal is price stability. That’s it. Nothing about employment, they don’t even care about it.

This is why Greeks have to immigrate because at the same time there is no law to determine the minimum wage rate, which is the level at which a human being can survive decently. There is now a law which determines that the minimum wage rate for unskilled labor is 486 euros per month. Just think about all of you who are living in Canada or in the United States or Australia and you visit Greece. Is it possible, with 486 euros per month, for a person to live decently?

No, they cannot. You’re reduced to a pauper. It is undeclared slavery. And even the salaries, even as a civil servant, the monthly salaries are lower than that in many instances. As the minister of labor in Greece has announced, about 125,000 people are employed with a salary of fewer than 100 euros per month.

I say this because the situation in Greece is really very severe, and it’s not an accident that recently a report released by the Cologne Institute of Economic Research has said that Greece is in last place of all EU nations in terms of its poverty level, which has reached 40 percent. That’s not far from what the International Monetary Fund (IMF) acknowledged with the data of 2015, [showing] the poverty level in Greece then as 36 percent.

However, people think this is not important, particularly academics who completely dismiss all these things and say that we must remain in the eurozone, without taking into consideration the severe economic situation and the predicament that many people are in and the suffering that keeps going.

[In ancient Greece], Solon resolved those problems. The Athenians were deserting Athens and the fields were uncultivated. As a result, even the rich people said that a solution had to be found. The city was on the verge of civil war. So they elected Solon because he was famous for his integrity and knowledge and because he was middle class, not rich and not poor. Therefore, the rich trusted him and the poor also trusted him, because when he was young he showed characteristics of patriotism.

Solon enacted the “seisachtheia,” and this word remained for centuries, and even now as a word it is extremely powerful. It means “I remove the weight of debts.” It was the first macroeconomic plan that was instituted in the history of civilization. The first thing that Solon thing was institute laws which abolished lending by placing your body as collateral. That was the first time such a law was established in the history of humanity. That’s why Solon’s name remains today as such a significant light in the development of human civilization.

The next thing that he did was to devalue the Athenian currency at the time, which was the Greek drachma. He devalued the Greek drachma to make the foreign trade of Athens more competitive. At the same time, he created incentives for people to come and work in Athens, from other cities that were highly developed, promising to issue Athenian citizenship.

He tried to augment or develop foreign trade in the context that the exports of the city had to be equalized with imports. Solon was the person who instituted the principle that, in order for a country to have self-sufficiency and to be an independent nation, the revenues achieved from exports have to be equalized with the revenues given to imports. This was something that no Greek state politicians have achieved since Greece became an independent nation.

Solon was the person who instituted the “church of the demos,” meaning direct democracy. Officials were directly elected by the people, and Solon was elected as an archon of Athens for 21 years continuously because back then you were elected for one year. This was enough time for him to take [Athens] out of its economic morass and to develop its place as one of the highest civilized nations of the ancient period.

 

MPN: How and in what way could Greece denounce its public debt, and what does international law and international legal precedent foresee for the issue of its debt?

SL: It is very difficult to really try to eliminate the debt legally, because there is no international law which establishes the principles between creditors and debtors when nations are involved. International law, and every state have bankruptcy laws that concern companies and individuals, but in terms of international law, there are no specific principles [for nations]. This is why a national delegation, the debtor, has to sit down with creditors and determine bilaterally how they’re going to resolve this issue, because nobody can benefit by squeezing the other, like what is happening right now to Greece.

Protesting hospital staff sit in front of a wall that they built at the entrance of the Greek Finance Ministry with a banner depicting Greek Prime Minister Alexis Thipras , Deputy Health Minister Pavlos Polakis and Greek Finance Minister Euclid Tsakalotos wearing ties reading in Greek ''Ministry of broken promises" and " We drown in debt and bailouts" in central Athens. (AP/Petros Giannakouris)

Greeks have nothing to do with the losses of the banks. They’re responsible for about 70 billion [euros] due to corrupt politicians, but 70 billion is manageable because it is less than 50 percent of GDP. Why does the Greek taxpayer have to pay because of irregularities and anomalies in the eurozone, due to the fact that this is a legal institution and is not a political or fiscal union? Why do the Greek people have to pay for all these losses?

There is no international law that can resolve this issue, and this is one of the reasons why we have a big advantage, legally and ethically, to tell them that we’re stopping payments because our country is impoverished, we’re in a humanitarian crisis, why should we pay unilaterally? When you make a deal of lending and borrowing, you have two parties. Why do banks get excluded and the borrower has to carry all the weight? It’s unbelievable.

The banks did all this damage because they invested in toxic bonds in various futures markets, in securitized products which they didn’t even understand, and they carried enormous losses, hundreds of billions, and they’ve placed it on the shoulders of a small country with a GDP of 175 billion euros. What type of justice is this? With the Greek situation and the suffering imposed on all Greeks, who are not all crooks, why should they be destroyed economically?


Related: Greece’s Neoliberal Wolves In Anti-Austerity Sheep’s Clothing


This is going to take more a generation, to put Greece back where it was. And probably not even that because right now, Greece’s national income and GDP growth are below 2003 levels. Greece has lost about 15 years. But in terms of moral values and general values, they’ve been completely demoralized. Only 3 percent of the public now believes in politicians. This is why this situation is not going to go away either. It’s the biggest economic crime that has ever been committed.

How is it possible for all these losses, which involve not just the Greek banks but also the German banks, the French banks, the Dutch banks, to have been passed only to Greece? The international system is connected, through the euro, which creates an international platform for capital to move freely from one country to another. At any time, any money can be transferred from Athens to Berlin, from Berlin to Frankfurt, from Frankfurt to Paris. All of these losses were in the end sustained by the Greeks because the politicians accepted this. This is why it’s going to be an issue that’s going to last, because the sums are huge.

According to the [Greek] national budget, which was voted and passed in December 2016, it has receipts from credit money—in other words, borrowed money—of 563 billion euros. The total budget of the Greek state, in other words, is 614 billion euros, while the revenues of the Greek state are 50 billion euros, of which 46 billion comes from taxes. This is 320 percent more than the GDP of Greece, and it’s signed by the Greek president and by the minister of finance! How is it possible to claim that Greece is benefiting from this money while at the same time the economy has collapsed by more than 28 percent?

You can understand here, the impasse and the unfairness and what has happened to the Greek state. A lot of people outside [Greece] have realized this. They are talking about the looting of Greece, because now in order to [pay the debt], they are saying to Greece that it has to sell all the public assets. Now we have to sell what our fathers and our ancestors tried to create. They fought for this land, now they have to sell it to pay interest upon interest which has already been paid.

Since we have entered the memorandums, we have paid over 60 billion euros [in interest], and they call this “solidarity.” And according to the new calculations, the payments the Greek state [is responsible for] up to 2030 total 160 billion euros just in interest. This is usury! This is one of the most extreme forms of usury. How is it possible to survive? Everything is going to fall apart.

If in the epoch of Solon they were escaping Athens to save their skins and not to be sold as slaves, here [in Greece] no decent person can remain. This is the situation of the eurozone, the legal laws that were passed creating this union which have nothing to do with humanity. It’s simply an interest scheme, a payment scheme for those countries that are richer. And the countries that are richer are the countries of northern Europe. This is why southern Europe has almost collapsed, and we’ll see this year whether Italy can save their own banking system.

 

MPN: Would it be correct to say that Greece would be able to undertake unilateral action to declare a stoppage of payments or to denounce or write down the debt once it leaves the eurozone and returns to a national domestic currency?

SL: We should remember that we [Greece] are a member of the eurozone. In other words, we cannot take unilateral action. The de jure bankruptcy of the nation will take place while the country is still a member of the eurozone. In other words, the government can declare a moratorium, a temporary stoppage of payments of six months to foreign lenders. At the same time, the government can immediately start negotiations with the European authorities: the European Commission and the ECB.

The main problem of the Greek debt is that the Greek debt that has been accumulated, [placed] in the budget of 2016, having the signature of the Greek state, amounts to 563 billion euros, which are credit receipts. The lenders forced the Greek government to pass all future debt of the Greek state [into the budget], and the problem, the time schedule of the Greek debt [repayment] is stretched to 2060. The ratio of debt to GDP exceeds 320 percent.

This amount, most of it—about 95 percent—has not accumulated due to the extravagance and excesses of the Greek state. Ninety-five percent of it is debt which has been incurred by the banking system as a whole, not just Greek banks, but also the whole eurozone system, involving mainly German and French banks who have lent to the Greek banks. Therefore, these payments are related to the whole eurozone system and not to the Greek state alone. Yet the taxpayers of the Greek state [are on the hook].

For that reason, we [can] expose all of the official records through a task force appointed by experts from other states—an international task force—that will verify what was published recently, one year ago by the Technical University of Berlin, which determined that the two initial memorandums, involving amounts [totaling] 240 billion euros that were given to the Greek state and named “bailouts,” weren’t given to bail out Greece. They were given to bail out the banking system!

According to this study, less than 5 percent has gone to the Greek economy, and the rest, about 95.5 percent, went for the repayment of the debt and losses of the banking system of Europe as a whole. That’s the problem that was created due to the inflexibility of the euro system. Because the euro has an irrevocable exchange rate, and after the global crisis in 2008, which was actually a financial crisis, it was impossible for the eurozone to cope with this.

For some reason, politicians accepted this, for the losses of the entire euro system to be taken by Greece, to be paid by the Greek taxpayers, while these losses involved the whole system, because the eurozone system is a system which is very incomplete, has many faults. It’s a creation where they put the carriage in front and the horse in the back.

 

MPN: What happens in the event that Greece does not find that the Europeans are willing to negotiate on the issue of the debt?

SL: In my view that would be almost impossible and it would be irresponsible, because Greece represents a huge bomb of debt. If they do not accept [a write-down], they’re going to expose the whole system to great dangers, due to the systemic risk that is involved in the banking system. The European banks are not only connected with the Greek banks, which are bankrupt, but also with the American banks – which according to certain financial analysts are exposed to a tune of more than 3 trillion euros to the European banks. Therefore, some analysts say that the Greek case is like Lehman Brothers squared.

This is why it’s so dangerous. This actually explains the political stance of previous governments in joining hands with the European authorities, for Greeks to bear this huge burden that doesn’t belong to them. As I said, 95 percent of the loans [given to Greece] are to save the banks and not the Greek state.

 

MPN: Recently, we have again begun to hear murmurs about the possibility of “Grexit,” as well as statements from various sources, such as the Hellenic Federation of Enterprises, and a joint statement by 14 Greek economists who are based outside of Greece, about the many “dangers” and “perils” of a Greek exit from the eurozone, and the economic “catastrophe” that would follow. How do you respond to these claims, and to this fear that is being repeatedly expressed?

SL: That’s why they don’t want Greece to get out from the eurozone, precisely for their own benefit. Greece holds a huge bomb of debt. Most of it, the Greek public was not responsible for. There were losses due to the imperfections in the architecture of the European system, and these losses have to be divided and shared by the other countries, not only by Greece. Greece and the Greek taxpayer are not responsible to pay taxes, a 24-percent value-added tax (VAT) and enormous prices for gasoline. Now we pay more than 1.50 euros for a liter of gasoline. How is it possible for this country to develop? It cannot.

Everybody is terrified of a Greek exit, but Greece has to exit in order to save itself. But Germany doesn’t want that. Why? Because of the domino effect, because of the systemic risk of the banking system. Germany wants to save their own system, a banking system which is also in terrible shape. [Germany] wants to maintain its status and the benefits that it gets from the eurozone.

The eurozone is a platform where all countries give up their monetary sovereignty and there is no convertibility of the euro. It is an irrevocable exchange, and therefore Germany has a uniform platform to export its own goods, to mobilize its great exporting machine, without having to fear a country devaluing. Since, from the very beginning, it was the net exporter, it was obvious that through time, all the wealth would be accumulated [in] Germany.

Right now, Germany sits on hundreds of billions of euros of net surpluses. Germany is following a neo-mercantalist model and has a tremendous benefit by exporting those goods. The other countries that have deficits, eventually they have to borrow the funds from the German surpluses. But Germany doesn’t do that. It makes direct investments in other countries, like Greece.

FILE - In this Sunday, Oct. 18, 2015 file photo, a man walks past street art depicting Greek Prime Minister Alexis Tsipras and German Chancellor Angela Merkel in Athens, Greece. Tsipras' decision to sign off on a bailout led to many in his left-wing Syriza party to quit in protest.

Right now, OTE [the formerly state-owned telecommunications company of Greece] doesn’t belong to Greece. Greece doesn’t have even 1 percent of shares in OTE. The majority of OTE now belongs to Deutsche Telekom, and the rest belongs to other international funds. Greece has no position there. Can you imagine if [there is a national emergency], what happens?

It is a fact that they call this “privatization,” but Deutsche Telekom is not a private company. It belongs to the German Federation. It’s a public institution. Similarly, [Greece] recently sold 14 airports to a German company [Fraport] that belongs to the German state, it’s not a private company. The [Athens international airport] Eleftherios Venizelos was sold initially to Germans, to Hochtief. Forty percent remains with the Greek state, but this [is also up for privatization]. But we already sold 14 airports. Why were they sold? Because we have to pay interest on the loans that have been imposed on us.

This is a situation where, I think, a decent politician with integrity can go ahead and try to tell the creditors “enough is enough, we have to settle this issue,” not to accept all these conditions just because Germany doesn’t want to resolve the issue because it has [upcoming] elections and because [German finance minister] Schäuble says that “debt is debt” and that it must be repaid. No, debt is not debt in this particular case, because [Greece] did not create that debt! You created it and passed it to us!

That’s why the banks are bankrupt, because the central bank decided, in order to fight the Greek people and to humiliate them, [prior to] the referendum of July 2015, to close the Greek banks. There is not even a legal definition to give the ECB the power to close the banks. Similarly, they closed the banks because they tried to affect the vote of the electorate. It was so obvious to close the banks and destroy all of the accounts, and nothing was said internationally!

The stocks of the banking issues in the Athens Stock Exchange had three “limit downs” consecutively, [a loss of] 30 percent. They lost 90 percent of their value, people were destroyed, firms were closed, and nobody said anything, people were waiting in line at ATMs to get money, [feeling] threatened and [worried] that they would be unable to feed themselves. They internationally humiliated the Greeks. Why did this happen? To frighten [the public] in order to [stay in] the eurozone.

The same tactic [is being used] now. Even though we have defaulted before, such as with the phony “PSI” [a “haircut” on Greek bonds enacted in late 2011 and early 2012] that supposedly “saved” Greece. By doing that, [this brought] the second memorandum, a loan of 130 billion euros. This did not save Greece. This money went, again, to recapitalize banks and to pay the debts that the Greek banks had from borrowed funds from the French and the German banks.

The creditor has a responsibility when lending money and therefore must accept losses from the borrower. But unfortunately this is not the story, and this is why “Grexit” is so important.

 

MPN: One option that we have been hearing about from analysts is the possibility of introducing a dual or parallel currency in Greece. What is the distinction between a dual or parallel currency on the one hand, and a national domestic currency on the other hand? And what would be the consequences of introducing a dual or parallel currency?

SL: First of all, a dual or parallel currency in Greece doesn’t solve the problem. This is simply a gimmick. The ECB has the monopoly power and according to the laws of the ECB, there is no such law or ordinance which allows nations to create a second currency. That would violate the principles of the treaty. That’s why the ECB [designed this system], to have control over the issue of money. For them, they have only one goal: price stability. Therefore, how would it be possible to give Greece the right to create a parallel currency when, at the same time, Italy is almost ready to default?

The debt-for-GDP [in Italy] now exceeds 132 percent, but at the same time, because Italy is a huge economy—it exceeds 2.3 trillion euros in debt—if something happens to Italy, the whole system is finished. It finishes because this is actually what they have developed in the eurozone with this primary purpose of the ECB to have the absolute control of money. It’s like creating another gold standard, and the gold standard died because it created so many anomalies and irregularities in the international system, and wealth inequalities.

Given this experience and given the fact that the eurozone is built on a gold standard—[one] based on fiat currency, which gives the right to the ECB to create unlimited money, like right now with the quantitative easing, it has already purchased one trillion-plus euros in securities. But Greece is not allowed [to participate in the quantitative easing program]. Why? Because they want to subjugate this nation in the form of “reforms.” These are not reforms! Simply, they didn’t purchase the Greek securities, just to make Greece pay the interest [to the ECB], and to subjugate and demoralize Greece, to not be able to provide resistance.

All this talk of dual currencies, all this is just to create a sundry understanding of the situation, providing false expectations that this can save the situation. It cannot save the situation. Nothing can really be saved or be improved by introducing this type of [dual or parallel currency] system, but I don’t think it will be introduced.

The only solution is the national currency, because then you are going to take back the power of creating your own money, and together with this, taking back the freedom of your country and getting out from this system, like England [with Brexit]. England has established the existing monetary system. That system is called the British model, where at the top of this system is the Bank of England. Now they see that system is collapsing and they’re leaving [the EU], because they created that system.

At that time [when this system was created], England prevailed globally because it established the gold standard. Having an advanced industrial [and shipping] sector, they were able to control other nations economically. At the same time, as with India, taking surplus value from India to England, and establishing the gold standard in a position to control deficit nations and [be paid] interest, because they did not have gold, like Greece.

Remember John Maynard Keynes. Interest reproduces so fast. “Tokos” [the Greek word for “interest”] means “to bring something into existence.” Aristotle said that it was hated by the whole society, because it creates [wealth] with no effort. The same thing has been instituted now. The Greek state gave the power to the ECB, and this ECB, through usury mechanisms, lends to the Greek state, but the Greek state pays double interest to the ECB and to the commercial banks because the ECB is not a lender of last resort! This abolishes the basic principle of central banks. That’s a function of a central bank, to be a provider of last resort funds if something goes wrong in the system. The ECB does the opposite!

The Cyprus situation shows exactly what I’m trying to say. This is why it’s crazy to talk about parallel currencies. What happened in Cyprus? One day, because [the ECB] did not properly supervise the banking system—which is one of the duties of the central bank, to have good supervision—and there were certain irregularities with certain banks, like Marfin Bank and the Bank of Cyprus. Instead of helping [Cyprus] alleviate the problem, the [ECB] went and did the so-called “bail-in.” A “bail-in” means “to capture,” to go and take money out of accounts. Whoever had their money in Cyprus banks, above 100,000 euros, lost money.

This is the situation, the banking institution that Greece wants? This is extraction, an extraction mechanism! This is like the old tyrants of Syracuse, which if you did not obey his order—and I mention this because Plato went there to educate him, and he didn’t like what Plato was saying, so he wanted to kill him. His supervisors intervened and he was sold as a slave in Aegina, and since then he was recovered from an old student and he was saved. The same thing [exists] in the eurozone.

I think all of these plans [for a dual or parallel currency] were publicized more to confuse the public.

 

MPN: Describe the steps that Greece could follow in order to depart from the eurozone in an orderly fashion, to transition to a national domestic currency and to avoid the dangers that many believe Greece would face, such as devaluation, high inflation or difficulty importing goods.

SL: A number of these things are a creation of imagination. Let me provide the basic steps of the exit of Greece from the eurozone and the adaptation of a national currency, based on two fundamental premises. First, that democratic institutions are maintained, and the constitution of the country, and second, that there is political will. Now, [those] are very important, fundamental assumptions, which right now do not exist. This is the system of exit for Greece, under the assumption that a light finally comes to the brains of the Greek politicians. If that happens, these are the steps that should be taken.

The country is declared in a “state of necessity,” and Article 44 of the Greek constitution is implemented, which means that after the suggestion of the council of ministers, which the prime minister presides over, power is transferred to the president of the nation. This declaration of the “state of necessity” is not required to be passed through the current representative assembly.

Then, the president declares a temporary stoppage of payments, an international moratorium. That moratorium is going to take a period of six months. During these six months, there is a plan for the reconstruction of the country—because it will be a reconstruction, it is economic devastation. So, at the same time when you declare a stoppage of payments—and this is going to be only for the foreign lenders, internally everything is going to be okay—this saves about six billion euros that are being paid in interest at this time, but also we stop payments of capital.

Therefore, we’ll have the ability to feed the nation and also to maintain salaries and pensions at the same level, because at this particular stage there is a slight surplus in the national accounts. Then we’ll have the benefit that we save six billion euros in interest payments, which would go directly to the reconstruction of the country and programs of employment.

This is what’s most important, to alleviate poverty and unemployment. That’s the primary thing, and that requires, of course, great coordination, to employ the people and to stop or to minimize the scourge of [outward] immigration. We need our educated people. This country cannot survive with old people, which continuously this is the case. It’s an aging population in Greece.

Then at the same time, we establish various capital controls, because we need the capital to remain here and not be exported abroad. Those are the major steps that should be taken simultaneously with a declaration of the nation in a “state of necessity.” It should not frighten [anybody], it’s a normal procedure which is [a result of] the extraordinary crisis taking place right now in Greece. Also it gives you the power to [declare] illegal all the measures that were taken through the austerity measures, which were based not on law, not on humanity, not anything, they were just horizontal measures [impacting] everybody without taking into consideration the principles of justice.

By placing the country in a “state of necessity,” immediately you can re-institute laws which would completely determine the unacceptability or the illegality of the existing laws of the memorandums, including the first memorandum of May 2010, the second memorandum of 2012, and the third memorandum of 2015, a total of 236 billion euros. Out of this sum, only 5 percent went to the Greek economy and for reducing poverty. Ninety-five percent went to payments. Those are known facts.

The third step after this is that you [create] a commission. We have to institute an agency which will go on to audit the Greek debt and to be confirmed officially, through the help of a task force of international [experts], to be a completely objective commission to determine which is the lawful debt and which is the unethical, unacceptable and odious debt.

In the meantime, the country, through its own people—Greek officials—start negotiations with the European authorities, whether this is the European Commission, the Eurogroup or the ECB. Of course, all those discussions have to take place when, first, the Bank of Greece is completely nationalized. This is important, because the Bank of Greece is a company and 92 percent of the shareholders are not yet known to the Greek public. This is an offense to the democratic spirit of the Greek people.

At the same time, things are not so straight, they are highly complicated because of the collapse of the Greek banks, the ECB has lent about 73 billion to “save” the banks after the fact, meaning that initially it was not accepting Greek state bonds as collateral. As a result, the banks could not really find funds to finance growth or to finance projects for businesses. [The ECB] did that, again, just to indicate that they are the power and they determine all political consequences in Greece. They decided to do so when the international public was misled that SYRIZA was a “radical left” party.


Related: Syriza Sells Greece Out To The Highest Bidders


[Soon after SYRIZA] was elected on Jan. 25, 2015, the ECB, on Feb. 4, went and declared unilaterally that Greek bonds, the bonds of the Greek state, are not acceptable, they are junk bonds. That meant that they were not accepted as collateral. So the banks would not be borrowing money from the ECB, and therefore the loan activity in Greece has fallen apart, going into [negative territory]. That further aggravated the situation.

Therefore, this situation should be taken into consideration, and that’s why the banks, initially, should go to a bank holiday. It’s a necessary thing that has to be done. The banking system is going to be closed, because you need to protect whatever savings there are.

This is the situation, and I’m sure that this is inconceivable to all of you living abroad, that this is the European model of a monetary system, but it’s not a monetary system. It’s an extractive system that lives on the blood of small and [minimally-]industrialized countries.

The next step after the banks are placed on a necessary bank holiday is the nationalization of the Bank of Greece, like the Bank of England, [which was] nationalized in 1946 and the Bank of Canada was nationalized in 1938. It’s to the benefit of all the parties to agree on this, [since] this whole situation is explosive. Why is it explosive? Because that huge amount that is owned by Greece, that exists 560 billion euros, it is something that can trigger like a bomb and the whole monetary system can collapse.

It would be another situation like the great global financial crisis of 2008, and the reason is that the U.S. system is interconnected with the European system. According to the latest reports, the U.S. banks have exposures of more than $3 trillion in European banks.

That’s the situation, that’s why it’s very important, that’s why everybody is talking about the Greek exit, because if Greece decides to pull the trigger then there’s going to be a very dangerous situation around the European, the Italian banking system. Italy has exposure of more than 2.3 trillion euros. If something happened there, then the whole European monetary system is going to collapse. We have power, in other words.

If one considers the benefits of this nation and the people that live in Greece, then we can achieve tremendous results. At the same time, in order to avoid this chaotic situation which a lot of people and particularly the academics are [predicting] but which is not going to be chaotic, but a normal situation after so many years in another currency, simply we will establish a three-month freeze of salaries and prices, so as not to have the problem of inflation.

Let me tell you how we’re going to determine the first exchange rate between the drachma and the euro. The initial exchange rate is introduced at parity, one new drachma equals one euro. This is the conversion [rate] for all accounts. All the loans now would be paid in Greek new drachmas, and whatever accounts remain in the banks, in the form of accounting—in other words, electronic money—those remain in euros, but simply whatever money is [withdrawn] is paid in new drachmas.

In other words, what you do is you stamp the existing euros with an indication that this is a new drachma. All the money, therefore, that is circulating outside the banks, [becomes] new drachmas, until the new currency is ready. So there is no problem with changing the existing banking system in Greece or the ATM system. Everything remains the same, we simply stamp the existing euros into a new currency. So a 10-euro bill becomes 10 drachmas. Salaries, again, are frozen, the same for prices, for a three-month period.

People queue in front of a bank for an ATM as a man lies on the ground begging for change, in Athens. (AP/Thanassis Stavrakis)

This is not something new. President Nixon did this in 1971 when he decided to get out of the fixed relationship of the dollar with gold. Then, the relationship was that one ounce of gold equaled 35 dollars. This was the beginning of the collapse of the Bretton Woods agreement, as he let the dollar be exchanged in the free markets. This was very successful, because the U.S. had problems at that time because it lost the Vietnam War and they were experiencing deficits, like Greece.

All these myths that a vacuum will follow, this is nonsense, because at this stage, the Greek trade balance account is balanced, because the imports are equal to the exports. We export 25 billion euros’ worth, we import about 40 [billion euros], but the difference is covered by services, and the services are tourism and the shipping fleet that Greece has, one of the greatest shipping fleets in the world. Knowing from Solon that the expenses of imports are covered by exports, this means that we have currency, foreign currency to pay [for our imports].

Again, we should remember [that during] the bankruptcy, we are still in the eurozone. You don’t go to the drachma [immediately]. This is a six-month period [of transition]. At the same time, you have the money to feed your people and to buy medicine, to buy oil, to buy whatever items are needed and are not produced in Greece.

And in the meantime, you save the six billion euros [in interest payments]. We don’t pay them any capital for the repayment of debt, and according to the Bank of Greece’s latest report, we still have foreign exchange funds right now, which are mostly in gold—about 5 billion euros. Therefore, from where does all this fear arise?

It’s going to take two or three months until the first newly-produced drachmas are placed in the market. Don’t think it’s a huge amount of money, cash, that is floating in the market. It’s about 20 billion euros. It’s enough, this money, to be circulating around, because multiplied by the velocity effect of money, it’s enough to start motivating the Greek economy. Here we do not have that either, everything is collapsing, the velocity is collapsing, because they’re taking out [money] by taxes.

Taxes destroy money, they do not create money. Paying the unfair interest to the Europeans that they call “solidarity,” six billion euros is an enormous amount with the multiplier effect. So simply, it requires guts. Freedom requires to be courageous and to be just, and I would add to this, to really work hard to achieve this objective.

Those are the most important measures. Just to add: in order for the new drachma to get validity, immediately you institute a law through which only the Greek drachma is acceptable as a payment to the Greek tax authorities. This is something that was said by Aristotle, [who] said that money is the creation of the law. That’s why it’s called “nomisma,” from “nomos” [the Greek word for “law”]. Itis a product of law and not of nature.

All these are myths that there’s going to be a collapse, that [the new currency] will not be accepted. Why won’t be accepted if the tax office accepts the money at the same rate as one euro? As long as it’s accepted at [a ratio of] one for one, why is the market not going to accept it?

One of the benefits during this period is that we will be able to lower tax rates. This is very important, to bring out the necessary steps for motivating foreign capital, but also the growth and development of businesses, because you are going to print the money to recapitalize.

All this ideological bias, that the euro is the only solution for Greece, is completely disastrous. It’s no solution. It’s the only catastrophic element for the complete elimination of the Greek state eventually. This is an extraction mechanism and a mechanism where all the loans, if you are not able to pay them, you are going to pay them by selling the public assets of the country.

Those are the basic steps. As long as it’s understood that it’s going to take a couple of months before the new national currency is cut, in Greece from Holargos [location of Greece’s mint], and still has the old machines through which the drachma was circulated. It’s going to take some time, but as long as there is patience and a belief that our freedom and future prosperity is based on reacquiring the capacity to create our own money, then the last necessary thing is that we and the European authorities understand that we have to find, together, a solution. Otherwise, it’s going to be a situation where everybody loses.

I conclude with the hope that finally, a light comes to the brains of the Greek politicians.

 

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How Greece Became A Guinea Pig For A Cashless And Controlled Society – By Michael Nevradakis

As Greece moves closer to becoming a cashless society, it is clear that the country’s attitude towards cash is reckless and dangerous. The supposed convenience of switching to a cash-free system comes with a great deal of risk, including needless overreach by the state.

A man makes a transaction at an automated teller machine (ATM) of a Piraeus Bank  branch in Athens, Greece. (AP/Yorgos Karahalis)

ATHENS (Analysis)– Day by day, we’re moving towards a brave new world where every transaction is tracked, every purchase is recorded, the habits and preferences of everyone noted and analyzed. What I am describing is the “cashless society,” where plastic and electronic money are king, while banknotes and coins are abolished.

“Progress” is, after all, deemed to be a great thing. In a recent discussion, I observed on an online message board regarding gentrification in my former neighborhood of residence in Queens, New York, the closure of yet another longtime local business was met by one user with a virtual shrug: “Who needs stores when you have Amazon?”

This last quote is, of course, indicative of the brick-and-mortar store, at least in its familiar form. In December 2016, Amazon launched a checkout-free convenience store in Seattle—largely free of employees, but also free of cash transactions, as purchases are automatically charged to one’s Amazon account. “Progress” is therefore cast as the abolition of currency, and the elimination of even more jobs, all in the name of technological progress and the “convenience” of saving a few minutes of waiting at the checkout counter.



Still insist on being old-fashioned and stuck behind the times, preferring to visit brick-and-mortar stores and paying in cash? You may very well be a terrorist! Pay for your coffee or your visit to an internet cafe with cash? Potential terrorist, according to the FBI. Indeed, insisting on paying with cash is, according to the United States Department of Homeland Security, “suspicious and weird.”

The European Union, ever a force for positive change and progress, also seems to agree. The non-elected European Commission’s “Inception Impact Assessment” warns that the anonymity of cash transactions facilitates “money laundering” and “terrorist financing activities.” This point of view is shared by such economists as the thoroughly discredited proponent of austerity Kenneth Rogoff, Lawrence Summer (a famed deregulator, as well as eulogizer of the “godfather” of austerity Milton Friedman), and supposed anti-austerity crusader Joseph Stiglitz, who told fawning participants at the World Economic Forum in Davos earlier this year that the United States should do away with all currency.

Logically, of course, the next step is to punish law-abiding citizens for the actions of a very small criminal population and for the failures of law enforcement to curb such activities. The EU plans to accomplish this through the exploration of upper limits on cash payments, while it has already taken the step of abolishing the 500-euro banknote.

The International Monetary Fund (IMF), which day after day is busy “saving” economically suffering countries such as Greece, also happens to agree with this brave new worldview. In a working paper titled “The Macroeconomics of De-Cashing,” which the IMF claims does not necessarily represent its official views, the fund nevertheless provides a blueprint with which governments around the world could begin to phase out cash. This process would commence with “initial and largely uncontested steps” (such as the phasing out of large-denomination bills or the placement of upper limits on cash transactions). This process would then be furthered largely by the private sector, providing cashless payment options for people’s “convenience,” rather than risk popular objections to policy-led decashing. The IMF, which certainly has a sterling track record of sticking up for the poor and vulnerable in society, comforts us by saying that these policies should be implemented in ways that would augment “economic and social benefits.”

 

The IMF’s Greek experiment in austerity

These suggestions, which of course the IMF does not necessarily officially agree with, have already begun to be implemented to a significant extent in the IMF debt colony known officially as Greece, where the IMF has been implementing “socially fair and just” austerity policies since 2010, which have resulted, during this period, in a GDP decline of over 25 percent, unemployment levels exceeding 28 percent, repeated cuts to what are now poverty-level salaries and pensions, and a “brain drain” of over 500,000 people—largely young and university-educated—migrating out of Greece.

Protesters against new austerity measures hold a placard depicting Labour Minister George Katrougalos as the movie character Edward Scissorhands during a protest outside Zappeion Hall in Athens, Friday, Sept. 16, 2016. The placard reads in Greek"Katrougalos Scissorhands".

Indeed, it could be said that Greece is being used as a guinea pig not just for a grand neoliberal experiment in both austerity, but de-cashing as well. The examples are many, and they have found fertile ground in a country whose populace remains shell-shocked by eight years of economic depression. A new law that came into effect on January 1 incentivizes going cashless by setting a minimum threshold of spending at least 10 percent of one’s income via credit, debit, or prepaid card in order to attain a somewhat higher tax-free threshold.

Beginning July 27, dozens of categories of businesses in Greece will be required to install aptly-acronymized “POS” (point-of-sale) card readers and to accept payments by card. Businesses are also required to post a notice, typically by the entrance or point of sale, stating whether card payments are accepted or not. Another new piece of legislation, in effect as of June 1, requires salaries to be paid via direct electronic transfers to bank accounts. Furthermore, cash transactions of over 500 euros have been outlawed.

In Greece, where in the eyes of the state citizens are guilty even if proven innocent, capital controls have been implemented preventing ATM cash withdrawals of over 840 euros every two weeks. These capital controls, in varying forms, have been in place for two years with no end in sight, choking small businesses that are already suffering.


Related: Greece’s Neoliberal Wolves In Anti-Austerity Sheep’s Clothing


Citizens have, at various times, been asked to collect every last receipt of their expenditures, in order to prove their income and expenses—otherwise, tax evasion is assumed, just as ownership of a car (even if purchased a decade or two ago) or an apartment (even if inherited) is considered proof of wealth and a “hidden income” that is not being declared. The “heroic” former Finance Minister Yanis Varoufakis had previously proposed a cap of cash transactions at 50 or 70 euros on Greek islands that are popular tourist destinations, while also putting forth an asinine plan to hire tourists to work as “tax snitches,” reporting businesses that “evade taxes” by not providing receipts even for the smallest transactions.

All of these measures, of course, are for the Greeks’ own good and are in the best interest of the country and its economy, combating supposedly rampant “tax evasion” (while letting the biggest tax evaders off the hook), fighting the “black market” (over selling cheese pies without issuing a receipt, apparently), and of course, nipping “terrorism” in the bud.

As with the previous discussion I observed about Amazon being a satisfactory replacement for the endangered brick-and-mortar business, one learns a lot from observing everyday conversations amongst ordinary citizens. A recent conversation I personally overheard while paying a bill at a public utility revealed just how successful the initial and largely uncontested steps enacted in Greece have been.

In the line ahead of me, an elderly man announced that he was paying his water bill by debit card, “in order to build towards the tax-free threshold.” When it was suggested to him that the true purpose of encouraging cashless payments was to track every transaction, even for a stick of gum, and to transfer all money into the banking system, he and one other elderly gentleman threw a fit, claiming “there is no other way to combat tax evasion.”

The irony that they were paying by card to avoid taxation themselves was lost on them—as is the fact that the otherwise fiscally responsible Germany, whose government never misses an opportunity to lecture the “spendthrift” and “irresponsible” Greeks, has the largest black market in Europe (exceeding 100 billion euros annually), ranks first in Europe in financial fraud, is the eighth-largest tax haven worldwide, and one of the top tax-evading countries in Europe.

Also lost on these otherwise elderly gentlemen was a fact not included in the official propaganda campaign: Germans happen to love their cash, as evidenced by the fierce opposition that met a government plan to outlaw cash payments of 5,000 euros or more. In addition, about 80 percent of transactions in Germany are still conducted in cash. The German tabloid Bild went as far as to publish an op-ed titled “Hands off our cash” in response to the proposed measure.

 

Global powers jumping on cashless bandwagon

Nevertheless, a host of other countries across Europe and worldwide have shunned Germany’s example, instead siding with the IMF and Stiglitz. India, one of the most cash-reliant countries on earth, recently eliminated 86 percent of its currency practically overnight, with the claimed goal, of course, of targeting terrorism and the “black market.” The real objective of this secretly planned measure, however, was to starve the economy of cash and to drive citizens to electronic payments by default.

Indians stand in line to deposit discontinued notes in a bank in Jammu and Kashmir, India,, Dec. 30, 2016. India yanked most of its currency bills from circulation without warning on Nov. 8, delivering a jolt to the country's high-performing economy and leaving countless citizens scrambling for cash. (AP/Channi Anand)

Iceland, a country that stands as an admirable example of standing up to the IMF-global banking cartel in terms of its response to the country’s financial meltdown of 2008, nevertheless has long embraced cashlessness. Practically all transactions, even the most minute, are conducted electronically, while “progressive” tourists extol the benefits of not being inconvenienced by the many seconds it would take to withdraw funds from an ATM or exchange currency upon arrival. Oddly enough, Iceland was already largely cashless prior to its financial collapse in 2008—proving that this move towards “progress” did nothing to prevent an economic meltdown or to stop its perpetrators: the very same banks being entrusted with nearly all of the money supply.

Other examples of cashlessness abound in Europe. Cash transactions in Sweden represent just 3 percent of the national economy, and most banks no longer hold banknotes. Similarly, many Norwegian banks no longer issue cash, while the country’s largest bank, DNB, has called upon the public to cease using cash. Denmark has announced a goal of eliminating banknotes by 2030. Belgium has introduced a 3,000-euro limit on cash transactions and 93 percent of transactions are cashless. In France, the respective percentage is 92 percent, and cash transactions have been limited to 1,000 euros, just as in Spain. Outside of Europe, cash is being eliminated even in countries such as Somalia and Kenya, while South Korea—itself no stranger to IMF intervention in its economy—has, similarly to Greece, implemented preferential tax policies for consumers who make payments using cards.

Aside from policy changes, practical everyday examples also exist in abundance. Just try to purchase an airline ticket with cash, for instance. It remains possible—but is also said to raise red flags. In many cases, renting an automobile or booking a hotel room with cash is simply not possible. The aforementioned Department of Homeland Security manual considers any payment with cash to be “suspicious behavior”—as one clearly has something to hide if they do not wish to be tracked via electronic payment methods. Ownership of gold makes the list of suspicious activities as well.

Just as the irony of Germany being a largely cash-based society while pushing cashless policies in its Greek protectorate is lost on many Greeks, what is lost on seemingly almost everyone is this: something that is new doesn’t necessarily represent progress, nor does something different. Something that is seemingly easier, or more convenient, is not necessarily progress either. But for many, “technological progress,” just like “scientific innovation” in all its forms and without exception, has attained an aura of infallibility, revered with religious-like fervor.

People queue in front of a bank for an ATM as a man lies on the ground begging for change, in Athens. (AP/Thanassis Stavrakis)

Combating purported tax evasion is also treated with a religious-like fervor, even while ordinary citizens—such as the two aforementioned gentlemen in Greece—typically seek to minimize their outlays to the tax offices. Moreover, while such measures essentially enact a collective punishment regardless of guilt or innocence, corporations and oligarchs who utilize tax loopholes and offshore havens go unpunished and are wholly unaffected by a switch to a cashless economy in the supposed battle against tax evasion.

This is evident, for instance, in the case of “LuxLeaks,” which revealed the names of dozens of corporations benefiting from favorable tax rulings and tax avoidance schemes in Luxembourg, one of the original founding members of the EU. European Commission President Jean-Claude Juncker, formerly the prime minister of Luxembourg, has faced repeated accusations of impeding EU investigations into corporate tax avoidance scandals during his 18-year term as prime minister. Juncker has defended Luxembourg’s tax arrangements as legal.

At the same time, Juncker has shown no qualms in criticizing Apple’s tax avoidance deal in Ireland as “illegal,” while having been accused himself of helping large multinationals such as Amazon and Pepsi avoid taxes. Moreover, he has openly claimed that Greece’s Ottoman roots are responsible for modern-day tax evasion in the country. He has not hesitated to unabashedly intervene in Greek electoral contests, calling on Greeks to avoid the “wrong outcome” in the January 2015 elections (where the supposedly anti-austerity SYRIZA, which has since proven to be boldly pro-austerity, were elected).

He also urged the Greek electorate to vote “yes” (in favor of more EU-proposed austerity) in the July 2015 referendum—where the overwhelming result in favor of “no” was itself overturned by SYRIZA within a matter of days. In the European Union today, if there’s something that can be counted on, it’s the blatant hypocrisy of its leaders. Nevertheless, proving that old habits of collaborationism die hard in Greece, the rector of the law school of the state-owned Aristotle University in Thessaloniki awarded Juncker with an honorary doctorate for his contribution to European political and legal values.

 

Cashless policies bode poorly for the future

Where does all this lead though? What does a cashless economy actually mean and why are global elites pushing so fervently for it? Consider the following: in a cashless economy without coins or banknotes, every transaction is tracked. Buying and spending habits are monitored, and it is not unheard of for credit card companies to cancel an individual’s credit or to lower their credit rating based on real or perceived risks ranging from shopping at discount stores to purchasing alcoholic beverages. Indeed, this is understood to be common practice. Other players are entering the game too: in late May, Google announced plans to track credit and debit card transactions.

Claudia Lombana, PayPal's shopping specialist, stamps a guest's passport as he visits the travel section of PayPal's Cashless Utopia in New York (Victoria Will/AP)

More to the point though, a cashless economy doesn’t just mean that financial institutions, large corporations, or the state itself can monitor all transactions that are occurring. It also means that the entirety of the money supply—itself now existing only in “virtual” form—will belong to the banking system. Not one cent will exist outside of the banking system, as physical currency will simply not be in circulation. The banking system—and others—will be aware not just of every transaction, but will be in possession of all of our society’s money supply, and will even have the ability to receive a percentage of every transaction that is taking place.

So what happens if your spending habits or your choice of travel destinations raises “red flags”? What happens if you run into hard times economically and miss a few payments? What happens if you are deemed to be a political dissident or liability – perhaps an “enemy of the state”? Freezing a bank account or confiscating funds from accounts can take place almost instantaneously. Users of eBay and PayPal, for instance, are quite aware of the ease with which PayPal can confiscate funds from a user’s account based simply on a claim filed against that individual.

Simply forgetting one’s password to an online account can set off an aggravating flurry of calls in order to prove that your money is your own—and that’s without considering the risks of phishing and of online databases being compromised. Many responsible credit card holders found that their credit cards were suddenly canceled in the aftermath of the “Great Recession” simply due to perceived risk. And if you happen to be an individual deemed to be “dangerous,” you can be effectively and easily frozen out of the economy.

Those thinking that the “cashless revolution” will also herald the return of old-style bartering and other communal economic schemes might also wish to reconsider that line of thinking. In the United States, for instance, bartering transactions are considered taxable by the Internal Revenue Service. As more and more economic activity of all sorts takes place online, the tax collector will have an easier time detecting such activity. Thinking of teaching your child to be responsible with finances? That too will have a cost, as even lemonade stands have been targeted for “operating without a permit.” It’s not far-fetched to imagine that particularly overzealous government authorities could also target such activity for “tax evasion.”

In Greece, while oligarchs get to shift their money to offshore tax havens without repercussion and former Finance Minister Gikas Hardouvelis has been acquitted for failure to submit a declaration of assets, where major television and radio stations operate with impunity without a valid license while no new players can enter the marketplace and where ordinary households and small businesses are literally being taxed to death, police in August 2016 arrested a father of three with an unemployed spouse for selling donuts without a license and fined him 5,000 euros. In another incident, an elderly man selling roasted chestnuts in Thessaloniki was surrounded by 15 police officers and arrested for operating without a license.

Amidst this blatant hypocrisy, governments and financial institutions love electronic money for another reason, aside from the sheer control that it affords them. Studies, including one conducted by the American Psychological Association, have shown that paying with plastic (or, by extension, other non-physical forms of payment) encourage greater spending, as the psychological sensation of a loss when making a payment is disconnected from the actual act of purchasing or conducting a transaction.

But ultimately, the elephant in the room is whether the banking system even should be entrusted with the entirety of the monetary supply. The past decade has seen the financial collapse of 2008, the crumbling of financial institutions such as Lehman Brothers in the United States and a continent-wide banking crisis in Europe, which was the true objective behind the “bailouts” of countries such as Greece—saving European and American banks exposed to “toxic” bonds from these nations. Italy’s banking system is currently teetering on dangerous ground, while the Greek banking system, already recapitalized three times since the onset of the country’s economic crisis, may need yet another taxpayer-funded recapitalization. Even the virtual elimination of cash in Iceland did not prevent the country’s banking meltdown in 2008.

Should we entrust the entirety of the money supply to these institutions? What happens if the banking system experiences another systemic failure? Who do you trust more: yourself or institutions that have proven to be wholly irresponsible and unaccountable in their actions? The answer to that question should help guide the debate as to whether society should go cashless.

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UN Report on Syrian War Crimes is a Bad Joke – Author: Jim Dean

 

4353423434“Diplomacy is the art of telling people to go to hell in such a way that they ask for directions.” ~ Winston Churchill

The UN announced its Syrian War Crimes report at a bizarre press conference on March 1st. The report received light coverage on that day and then immediately died, sparing all those in the world who had missed it, because it was an embarrassment to that organization.

I could hardly believe, with Aleppo having been free for some time, that the UN could have produced such a muddled and convoluted report. It began by stating that victims on both sides had fallen victim to war crimes by all parties. By throwing out this blanket accusation, chairperson Paulo Pinheiro was giving cover to ISIS by saying they were no worse than the Syrian government.

Obviously, the good chairperson did not go to Aleppo after the battle to talk to those on the East and West sides, but signed his name to this monstrosity of a report. All the independent media I have seen since the battle was over reported the vast majority of the people were thrilled that the city was back under Syrian government control, and that the jihadis, who were the real ones who had them under a ruthless Sharia Law siege, had departed with their families to Turkey and Idlib.

The UN viewed that the taking of the city, which ended the fighting that would have continued the civilian killing indefinitely, was really a war crime because the city had been “put under siege” by the Assad government. Incredibly, there is no mention of the terrorists and their opposition supporters having put the city under siege.

And when a difficult negotiation to avoid a fight to the last man of the jihadis and their civilian human shields they had kept with them succeeded in luring the jihadis out of Aleppo, with some going to Turkey and others to Idlib, rather than celebrate this accomplishment, Pinheiro called it a war crime because it was a “forced evacuation.” Creative perception management, if ever there was.

I think Mr. Pinheiro’s report is a war crime. In any other arrangement to separate the jihadis and their families from the city, they would have all been killed, and taking as many Syrians with them as they could in their mass suicide. Witness reports claim that most of ISIS inside the city were foreign fighters anyway, and terrorists don’t come under the laws of war, by their own hand.

The report goes on to repeat the long litany of charges we have heard all through the war, that the limited Syrian air force with its older planes and difficult supply lines had nothing better to do than waste precious air sorties by randomly killing non-combatants, so more ISIS fighters could remain alive to kill more Syrian soldiers. Many of the schools and medical facilities were ISIS command centers, and they only provided coverage to ISIS family members.

Using such facilities, which often have been abandoned for weapons and ammo storage, has been a staple tactic for the terrorists and their Western government supporters. When Doctors Without Borders (DWB) put out their initial report, they claimed that certain hospitals had been bombed, yet later analysis revealed there were no hospitals in those towns. VeteransToday did a background check on DWB and found it to be an intelligence front for the French, which is nothing new, as a substantial part of the NGOs working in Syria functioned not only as Intel fronts, but some ran a major supply line for the jihadi terrorists, especially the Red Crescent out of Turkey. Running supply lines is a war crime in itself, yet I cannot find a single report where the UN was able to discover how relief convoys became major arteries to the Syrian insurgents.

But it gets even worse, when the report spotlights the UN/Syrian Arab Red Crescent aid convoy that was attacked southeast of Aleppo. Initially, the UN had said the perpetrators were undetermined, but by report time, someone had decided to blame the Syrian Air Force. We are told a fantasy tale of a three-stage attack, beginning with helicopter barrel bombing, then bombing by planes, and then the planes coming down to strafe the survivors.

It all sounded like a B-grade movie, yet later the report lists almost 300 interviews and sources, but does not list who they were, or what events they were witnesses to. Save your energy looking for any detailed witness testimony. There is none in the UN report.

There are some glaring problems with the convoy attack story. First, the Syrian Air Force does not fly helicopter barrel bombing at night because they cannot see. The same goes for the Syrian planes. They are not equipped for night bombing, only the Russian planes were. And last, the story of the planes coming down to strafe at night is ludicrous, as is the UN claim that all the witness accounts of the event were consistent.

This is never the case in an incident as described. People on the ground are terrified, running for cover, tending to wounded, they are not all standing up trying to ID whether planes or helicopters, what kinds and who they belonged to. Any interrogator would have told Mr. Pinheiro that when all the witnesses claim to have seen exactly the same thing, that is a strong indication of a concocted story.

The force evacuation war crimes charge is revisited in the report in the context that civilians should never be blocked from returning to their homes [in Aleppo]. This seemed astounding, as civilians were trying to get off the battlefield and out of the city to escape the fight to the death scenario that had been expected, including being used as human shields by the terrorists.

Those lucky enough to get out were able to reach aid facilities in safe areas that were at least able to get them registered on survivor lists, fed, and temporary housing found, while the city went through the difficult process of de-mining, and getting the destroyed utilities running again, especially in the East.

Fantasy by Omission

Missing from the UN report was how the Russian Special Forces Arabic branch had infiltrated East Aleppo and operated for months before the final battle. Their task was to remove the jihadi command structure via targeted killings, using tactics from long-range snipers, to “tagging” their vehicles at night, so special bombs could hone in on their signal while moving.

These special ops teams laser targeted ammo dumps and command structures, using state of the art munitions from the Russian Air Force inventory that zeroed right in on the target to reduce bombing error. As the jihadi commanders were knocked off, they were led to believe they were being killed by rival groups, which ignited intra-warfare among them.

It was at this point that the final push was made on East Aleppo, when the jihadi command structure was either dead or in chaos. Large sections of the city were taken, sometimes in just a few days, due to the jihadis giving ground to shorten their defensive perimeter while squabbling over resource logistics.

None of this is in the UN’s la-la-land report. Nor is there a word about the US, Saudi Arabia, Gulf States, Turkey and Israel having supported the terrorists in Syria, when aiding and abetting terrorism is a grand slam felony. It can even get you bombed or droned.

So now what does the UN want to do? It seems it wants to make a big name for itself by hunting down the individuals that did the convoy attack. But if it turned out to have been a false flag by the Israelis, Turkey, or Saudi Arabia, do you think the UN will do anything? Of course they won’t.

The UN report was a disgrace, and the public deserves a refund. We already knew that lots of war crimes had been committed, and we knew who the biggest killers were. And we knew the UN is not really interested in taking any action against them, for a variety of reasons. We will not let Syria be scapegoated like this, being compared as equivalent to the terrorists. Shame on you Mr. Pinheiro.

Jim W. Dean, managing editor for Veterans Today, producer/host of Heritage TV Atlanta, specially for the online magazine “New Eastern Outlook”.
http://journal-neo.org/2017/03/16/un-report-on-syrian-war-crimes-is-a-bad-joke/

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Greece’s Neoliberal Wolves In Anti-Austerity Sheep’s Clothing – By Michael Nevradakis

Far from representing truly alternative voices, three Syriza leaders crafted empty public images as anti-austerity renegades and champions of democracy and justice.

Greece Bailout

ATHENS — (Analysis) In January of 2015, opponents of neoliberalism and the harsh policies of economic austerity rejoiced at the electoral victory of Syriza in the Greek parliamentary elections.

Touted as the “first-time left,” the new Syriza-led government was portrayed as a “would-be savior” for Greece. It was further hailed as the regime that would reverse the country’s fortunes and stand up to the demands of Greece’s lenders in the European Commission, the European Central Bank, and the International Monetary Fund–the trio collectively known as the “troika.”

Flash forward to today: One year after ignoring the result of a referendum which rejected further austerity measures proposed by Greek lenders, the Syriza-led government is enforcing the dictates the third memorandum, an even more onerous austerity agreement agreed to in August 2015. In the interim, further legislation has been passed which has ceded control over the entirety of Greece’s publicly-owned assets for 99 years and relinquished the sovereign parliamentary right to pass legislation on key budgetary and economic issues.

The end results of these agreements and the new austerity plan which has followed have been catastrophic. Already-battered pensions have been further slashed by as much as 50 percent or more. The port of Piraeus, 14 profitable regional airports, the national railway system, and the prime site of Athens’ former international airport have been sold off to foreign investors at bargain-basement prices and privatized. The sell-off of Greece’s municipal water utilities, which Syriza officials at one time claimed would occur “over our dead body,” is the next in line to be completed. Further, automatic budget cuts lurk ominously ahead, to be implemented automatically if Greece does not meet its troika-imposed fiscal targets.

After a long period of dormancy, lulled by the promise of a government that was purportedly engaged in hard negotiations with Greece’s lenders, the people of Greece have roared back to life. Air traffic controllers recently staged a wildcat strike, walking off from their jobs in protest of the privatization of Greece’s airports–a process slated to be expanded to the remaining facilities in which the Greek state still owns a share. With nothing left to lose, pensioners have taken to the streets to protest the virtual elimination of their already meager pensions.

A protester chants anti austerity slogans during a demonstration in central Athens, on Friday, May 6, 2016. A protester chants anti austerity slogans during a demonstration in central Athens, on Friday, May 6, 2016.

While back in January of 2015, the world celebrated as the “saviors” in Syriza removed barricades around the Hellenic Parliament and promised to dissolve the violent, corrupt riot police, nowadays the Syriza government prefers to unleash the very same riot police on elderly, impoverished protesters, who are also targeted with generous sprays of tear gas. Instead of tearing up the memorandum and austerity agreements, as had been promised prior to January of 2015 by current Prime Minister Alexis Tsipras and other Syriza officials, Syriza officials now express regret that the word “memorandum” has been “demonized.”

Within Greece at least, the hero worship previously afforded Syriza has transformed into a wide-ranging sentiment in which many citizens and voters now openly support “anyone but Syriza.” In such a climate, voters have once again begun searching in earnest for a new “savior” to rescue Greece from its death spiral of austerity, hopelessness, and crippling economic depression. Several such political personalities loom large in the imaginations of many voters, including “radical” economist and former finance minister Yanis Varoufakis, former speaker of the Hellenic Parliament and founder of the “Course of Freedom” party Zoe Konstantopoulou, and former energy minister and founder of the Popular Unity party Panagiotis Lafazanis.

Do these personalities represent a true hope for change and optimism? Or are they merely the next in line to follow Syriza’s footsteps in promising radical change but delivering continued austerity instead? Their respective backgrounds and actions while in positions of power reveal the likely answer.

 

Yanis Varoufakis: Radically promoting austerity

Former Greek finance minister Yanis Varoufakis attends a news conference about the launch of a new left-wing pan-Europe political movement called 'Democracy in Europe Movement 2025' in Berlin, Germany, Tuesday, Feb. 9, 2016. (Photo: Markus Schreiber/AP)

Yanis Varoufakis has crafted a reputation for being a “radical,” “anti-austerity” renegade economist who is unafraid to break conventions and tackle the status quo.

However, his record–particularly during his time as Greece’s finance minister from January to July 2015–tells a different story.

In his early days as Syriza’s finance minister, Varoufakis entered negotiations at the February 2015 Eurogroup summit proposing the continuation of 70 percent of previously implemented austerity measures for an additional six months. He refused to raise the possibility of a eurozone departure for Greece, not even as a “plan B” or a negotiation tactic. The 70 percent proposed by Varoufakis ultimately became an agreement for the continuation of 100 percent of the existing austerity measures for four additional months. Varoufakis, in his usual style, described the agreement as an exemplar of “creative ambiguity,” while suggesting that the troika now be referred to as the “institutions” instead.

In these early days of the “first-time left” government, Varoufakis hired Wall Street firm Lazard to advise the Greek finance ministry. This is the same firm which advised the government of George Papandreou (whom Varoufakis advised for six years) on the signing of the first memorandum agreement in 2010, the government of unelected technocrat Lucas Papademos on the introduction of further austerity in 2012, and the previous New Democracy-PASOK coalition government on the privatization of public assets.

Varoufakis’ “radical” rhetoric continued when he repeatedly stated, as finance minister, that Greece’s debt was legal and would be repaid “ad infinitum,” even while a parliamentary committee which was purportedly investigating the legality of this very same debt was in session.

In an interview with The Associated Press, Varoufakis stated that he would “squeeze blood out of stone” in order to repay the IMF, while in another interview, Varoufakis stated that he sought to develop good relations with Christine Lagarde and the IMF, which holds views that he said he personally agreed with. In an interview with Australia’s ABC, Varoufakis further stated that even if the government wanted to proceed with the “Grexit,” it was unable to mint its own currency, claiming that Greece’s mint was destroyed when the country joined the eurozone. In reality, Greece’s mint is still operational; it’s where €10 notes are printed today.

Former Greek Finance Minister Yanis Varoufakis, explains why he thinks Brexit could trigger dire economic consequences for the European Union.

Watch Yanis Varoufakis explain why he thinks Brexit could trigger dire economic consequences for the European Union:

http://finance.yahoo.com/video/warning-against-brexit-yanis-varoufakis-104400924.html?format=embed

As finance minister, Varoufakis tapped Elena Panaritis as Greece’s representative to the IMF. This is the same Panaritis who was a former World Bank official and who was the architect of the catastrophic “Fuji Shock” policies implemented in Peru under the regime of the now-jailed Alberto Fujimori.

These policies drove millions of Peruvians into poverty, resulted in price increases of up to 8,000 percent on basic goods, and led to the privatization of hundreds of public assets. Later, as a member of parliament with PASOK, Panaritis voted in favor of austerity and the memorandum agreements. In turn, Varoufakis, as finance minister, stated that previously implemented privatizations would not be rescinded and that he supported the privatization of public airports and harbors “under certain conditions.” He also spoke out favorably of the so-called “investments” of China’s COSCO, including the privatization of the port of Piraeus, describing this as a “positive development” for Greece.

Forging ahead in the spring of 2015, Varoufakis, in his capacity as finance minister, oversaw the implementation of a governmental decree which confiscated the cash reserves of the entirety of the Greek public sector. Later ratified by parliament, including Varoufakis’ vote, the decree authorized the payment of the May 2015 installment of Greece’s loans to the IMF with the confiscated funds. This action was then followed up by a 47-page proposal crafted by the finance ministry under Varoufakis’ watch as part of supposedly “fierce” negotiations with the troika. That proposal foresaw €8 billion in new austerity measures, including a perpetually increasing primary budget surplus (which would mean more cuts in order to maintain a surplus in a sinking economy) and the privatization of major public assets.

At around this time, Varoufakis presented a proposal for the introduction of a parallel currency, similar to the IOUs that had been issued by the state of California in 2009. He also announced the impending implementation of capital controls in the form of weekly limits on withdrawals from domestic bank accounts. These capital controls remain in place today and have significantly crippled the Greek economy, particularly small and medium-sized businesses which have been stripped of access to their own capital.

This set the stage for the July 5, 2015 referendum which was scheduled soon thereafter. Varoufakis did not present any proposals to the people of Greece nor give any indication of what the government’s plan would be should the “no” vote against austerity prevail, as it ultimately did. Following his resignation from his post as finance minister–a well-timed move which allowed him to make a heroic exit in time to avoid the forthcoming trainwreck, Varoufakis was absent from the parliamentary vote which ultimately authorized Prime Minister Tsipras to make a deal with the country’s lenders. Varoufakis did publicly state, however, that had he voted in parliament, he would have voted to give Tsipras authorization to reach an agreement—authorization which led to the third, and harshest, memorandum agreement for Greece.

Other highlights of Varoufakis’ tenure include his vote for corrupt conservative former New Democracy minister Prokopis Pavlopoulos as president of the Hellenic Republic, his asinine plan to hire tourists as “tax snitches” to report on cases of tax evasion, his high praise for Margaret Thatcher, and his statements calling for Greeks to lead an “austere existence” while he posed alongside his wife for a photoshoot at his luxury residence in Athens with a view of the Acropolis and a table set with a rich lunch spread.

On a terrace of the family building Danae in Athens, Sunday, March 8.

A scion of a family of wealthy Greek industrialists, Varoufakis is comfortable mingling with a crowd far removed from the “leftist” rhetoric he supposedly embodies. In January of 2015, just prior to that month’s elections, Varoufakis’ new book in Athens was presented by television talking head Babis Papadimitriou, infamous for proposing that the conservative New Democracy consider a future governing coalition with a “more serious” Golden Dawn, Greece’s far-right party.

This is the same Varoufakis who is now poised to “save Europe from itself” through his new pan-European “pro-democracy” movement, DiEM25. The movement claims to have a plan to “reform” EU institutions, yet ignores the deeply undemocratic, authoritarian foundations upon which it has been constructed. And it further refuses to raise the specter of abolishing the grossly neoliberal European common currency project or to advocate for the bloc’s weaker economies to depart from the eurozone, including Greece.

 

Zoe Konstantopoulou: Charting a new course or more of the same?

Zoe Konstantopoulou acknowledges the supporters during a pre-election rally, in central Athens, Tuesday, Sept. 15, 2015.

Even more so than Yanis Varoufakis, the political figure who has been presented as a beacon of hope and change in Greece in recent months is Zoe Konstantopoulou, president of the Hellenic Parliament during the first Syriza-led government of January to August 2015. Like Varoufakis, she stems from a prominent family: Her father, Nikos Konstantopoulos, had been the head of Syriza’s predecessor party, Synaspismos, while her mother, Lina Alexiou, is the acting president of the (essentially defunct) National Committee for Radio and Television, a rough equivalent of the United States’ FCC.

As president of the Hellenic Parliament, Konstantopoulou (via the same mass media which was purportedly battling her at every turn) engineered an image of a fierce champion of law and justice. This perception was formulated both as a result of the establishment of a parliamentary commission to audit Greece’s debt—overseen by Konstantopoulou—and by seemingly not being afraid to speak out against the male-dominated Greek political establishment.

The devil is in the details, however, and many of the details of Konstantopoulou’s tenure were overlooked. The debt audit commission began its investigation in parallel with statements repeatedly being made by Yanis Varoufakis, Prime Minister Tsipras, other Syriza government ministers, and even the newly-elected president of the Hellenic Republic, Prokopis Pavlopoulos, promising that Greece’s debt would be repaid in full.

Watch Zoe Konstantopoulou speak out against the Greek government’s agreement with the European troika regarding the political and economic countermeasures to the Greek government-debt crisis:

The otherwise outspoken Konstantopoulou did not respond to these statements, nor did she address actions such as the implementation of a decree to confiscate the cash reserves of the Greek public sector for the purpose of repaying an IMF loan installment. In fact, Konstantopoulou voted for Pavlopoulos in the parliamentary vote to confirm him as the Hellenic Republic’s president, just as she voted to confirm all of the austerity bills passed by the Syriza-led government during its initial term in power.

Far from speaking out, Konstantopoulou publicly stated in May 2015 that Syriza’s pre-election promises to “tear apart the austerity agreements” were a mere “figure of speech.” These are hardly the actions of a dynamic anti-austerity advocate of justice, and neither was her show of support in favor of the Tsipras government following the betrayal of the July 5, 2015 referendum result which rejected the lenders’ austerity proposals. Instead of speaking out against the government or resigning from her post–even at that late moment, even following the passage of the third and harshest memorandum agreement to date, Konstantopoulou continued to publicly support Tsipras and the Syriza-led government, just as she, as president of parliament, never suspended parliamentary debate as further austerity bills were being debated. Konstantopoulou courageously voted “present” (as opposed to “no”) in the parliamentary vote ratifying the third memorandum agreement. The public proclamations of support for the Tsipras government only ceased when Konstantopoulou and other Syriza “renegades” were informed that they would not be included on the ballot for the September 2015 snap parliamentary elections.

This tenure has apparently served as the perfect preparation for Konstantopoulou to now swoop in and save the day for Greece and its people. This past spring, she announced the establishment of the Course of Freedom political party, which promises to deliver an end to austerity and to chart a course for a “plan B” for the country—a plan, however, which does not encompass a departure from the eurozone or the European Union, but instead proposes a parallel domestic currency in circulation alongside the euro and the likely formation of a two-tiered economy of “haves” and “have nots.”

 

Panagiotis Lafazanis: Hardly a fresh face

Panagiotis Lafazanis, former energy minister and head of the left-wing Popular Unity party, flashes the victory sign during a pre-election rally, in central Athens, Tuesday, Sept. 15, 2015.

Panagiotis Lafazanis is no stranger to the political landscape. An old mainstay of the Greek “left,” Lafazanis has passed through Greece’s Communist Party (KKE), Syriza’s predecessor party Synaspismos, and Syriza prior to founding the Popular Unity political party ahead of the September 2015 elections.

In the first Syriza-led government of January to August 2015, a particularly sensitive time for such issues in Greece, Lafazanis served as energy and environment minister. His portfolio encompassed the issue of the controversial and environmentally damaging gold-mining activities in Skouries in northern Greece, as well as the potential privatization of Greece’s largest water utilities. Syriza, prior to being elected, campaigned heavily against the activities in Skouries and against the privatization of water utilities, which Tsipras had once said would occur “over our dead body.”

While Lafazanis did suspend two licenses issued to the operators of the Skouries mine, the Canadian-owned Barrick Gold Corp., gold mining activity in the region continued, as did the government’s talks with Suez and other foreign corporations which are interested in buying up Greek water utilities. Lafazanis delivered mixed messages, stating his opposition to the mining activities while referencing Greece’s “commitments” to its investors. Like Yanis Varoufakis and Zoe Konstantopoulou, Lafazanis voted in favor of the election of Prokopis Pavlopoulos as president of the Hellenic Republic; he also voted yes for all of the austerity bills presented by the Syriza-led government leading up to the July 5, 2015 referendum.

Like Konstantopoulou, Lafazanis also continued to support the Syriza-led government even after the betrayal of the July 5, 2015 referendum outcome. This support continued until Lafazanis, like Konstantopoulou, was not included on the Syriza ballot for the September 2015 snap elections. It was at this time that Lafazanis hastily announced the formation of Popular Unity, a purportedly anti-austerity party which essentially regurgitated the old Syriza promises from prior to its initial elections, while presenting mixed messages regarding its stance on a “Grexit” and whether Greece should remain in the eurozone or return to a domestic currency.

 

Discovering the savior within

A supporter of the communist-affiliated union PAME takes part in an anti-austerity rally in front of the parliament in Athens, Monday, Oct. 17, 2016.

Far from representing truly alternative voices, Yanis Varoufakis, Zoe Konstantopoulou, and Panagiotis Lafazanis have acted as political opportunists. They’ve crafted a public image as anti-austerity renegades and champions of democracy and justice, even as their real actions while in a position of power and authority belied that empty rhetoric.

This matches Syriza’s ascension to power and its current ludicrous efforts to pass off the harsh austerity and privatization regime that they are enforcing as an example of “leftist” politics and a triumph of “social justice.” It is absurd to believe that political figures who voted for and justified the policies that they are supposedly denouncing, are capable of delivering on those same promises.

Instead of placing all their hopes with the next establishment-anointed political savior or an official electoral process, Greek voters have a golden opportunity to make their voices heard and demand real change. Each day is a chance to call for an end to stifling austerity and privatizations that are further crippling the domestic economy, the much-needed reform of Greece’s corrupt justice system and collapsing educational and health care systems, and a departure from the European Union and the eurozone, two institutions which have been so destructive for Greece, its people, and its economy.

Even as more and more rumors circulating in Greece of impending snap parliamentary elections, the time has come for the people of Greece to become their own saviors rather than place their homes with tired, discredited political retreads.

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