Thursday, July 01, 2010

Repeat after me: You have no choice

This is the message that the Greek media have been bombarding the country with ever since the PASOK government went cap in hand to the IMF, EU and ECB for a bailout loan that would, it was said save the country from bankruptcy.

Whilst the strict terms under which the the money is being spent may help French and German bankers sleep better at nights the cost of "internal devaluation" have wrecked havoc with those Greeks at the bottom of the ladder. Hit by a triple whammy of large price hikes caused by two increases in VAT, cuts in income and massive rise in unemployment many are struggling to survive, cutting spending on even basic such as groceries to the bone.

This in turn is further deepening the crisis by hammering the country's retail sector which has responded by shedding jobs and so the vicious circle creaks on.Even going to Greece's famed beaches has become a luxury beyond the reach of many as petrol has risen by nearly 60% in less than a year.

The government say we have no choice, there are no alternatives and the measures, as painful as they are are necessary to restore Greece to financial health. However, in the absence of any kind of coherent plan for economic growth the present policy of cutting costs and raising more government revenue through indirect taxation seems a recipe for disaster and is likely to doom the country to a long period of stagnation and poverty the likes of which modern Greece has not experienced in 50 years.

Summer is not traditionally a period of intense political activity here but come September Prime minister Giorgos Papandreou is likely to be faced with an electorate at the end of their tether and outraged by a political system that has been marked by both massive corruption and unbridled incompetence. At that stage even his supporters in the supine national media are not going to be in a position to help him out of the hole he has dug for himself, his party and the country.

1 comment:

archie said...

this is so sad, I taught english fof 6 months in greece in 1991, the students i taught ("my kids") would be between 25 and 37 now, i remember their pride in the country and their simple optimism about progress for the future.

God only knows what they are going through now especially if they have families to support.

I enjoy your blog very much as it keeps me in touch with a country I have the fondest memories of. Also that you report the truth about how this is impacting upon the majority of greeks who do not have hidden pools.

Keep up the good work.