Tuesday, May 22, 2012

Exit from the Euro. Like we could care less..



The last couple of days I keep reading in newspapers about Greece’s Exit from the Euro.

This however interesting for Greek people like me who expatriated themselves, the problem is far more serious than what mentioned on CNN ,Euronews, etc
I have watched the story lines on those channels as well. What those channels fail to pass along is the needs of the people  ( Edit: I have only found articles in the Guardian that travel along those lines)

Imagine yourself living in a country where you and your kids have no job opportunity whatsoever and that only one member of the family is providing for you.
Imagine that this occurred throughout a night. You and almost everyone you know lost their jobs. It is natural to assume in this case that a basic survival instinct will emerge and will include only the ones that are close to you. No "altruistic" stance, no "greater good" speech will affect you. You have one problem and on problem alone: NO sufficient income to support your needs.
(Whether or not those needs are the remnants of 30yrs of social decay is a topic that I might try to explain later on)
So take any person in that financial state and try to explain to him  about the aftereffect that a  possible leave from the EU-zone and currency will have. Even thou he/she will totally understand what you say, it is not a problem that concerns him.
Your "prognosis" and that of the Media is , in my opinion , midterm or even far into the future.
For a large portion of the Greek population these prognosis say nothing. When you don't have a job or any possibility to find one, let alone in a field of interest; when you don't have any savings whatsoever and no support ( family excluded) why in the world would you care about your currency or it potential devaluation? You don't have anything to lose!


The problem now in Greece remains a Social problem. The fact that most of the money given to Greece via Troika and the IMF are used to pay off old depts and only a very small portion of it is used for paying salaries and pensions. Almost nothing is used for development and growth. From a Free-Markets perspective , no one in his right mind will invest in Greece at the moment due to the fact that its a country in turmoil. Not good for business (unless you are a financial giant ).

That as well worsens the problem. Nobody produces anything ,cause nobody wants it. Greece's infrastructure has gone from Down-spiral to free-fall. It was small to begin with in 2008, imagine how it is now. Nothing is being done. And nobody (within the Parliament ) seems to know how or even have the political-“balls” to make changes.
So the people have nowhere to turn to for hope. Which takes me to my next point which is the political situation.
In Greece over the past decade or so, we have been experiencing the steady decline of political figureheads ( A problem that not only Greece but also the majority of European states are experiencing). No politician is capable to convince us that what he says, will change and make things better.

- Pasok , the Socialist Party and winner of the 2009 elections , got the full blow of the people's distrust, and with good reason(dropped from 45% down to 7%).
- New Democracy got a 18% of the voters( from 40%) and won the elections. That hardly counts as a win, don't you think?
- Syriza on the other hand ( A Central-left-liberal party) got 17% from a 6%.
- Golden Dawn, an ultra-right/extremist/officially Nazi  political party got a 7% from a previous 0.3%!!
These numbers say allot on their own.
[Note: The percentages given above are just a rough number, not the actual ones]

Conclusion: We don't trust our politicians.They have twisted the legal system so much to their benefit , so no one can touch them. They are above the law and constitution ( as it being seen these past few months)   

And to top that you  have the aims and goals of the IMF & Co which are trying to enforce further salary and pension cuts. One can only wonder where they  will stop.

Greeks are in their worse political/social condition since the 1950 ( !!)
  1. They have no jobs
  2. They don't trust their politicians
  3. They don't trust the media
  4. They don't trust the Legal System
  5. They definitely don't trust the IMF
  6. They feel that they have no future.

We are between Skila and Harivdis , to use a reference from Homer's Ulysses.
 
I remember talking with my mother and father about this, back when it all started (2008). I remember telling them that it's their Generation that failed their dreams, and consequently failed the generations after them. Now it falls on my generation ( 30 yrs after them ) to pick up the country and lead it to where we think it should go. I am very doubtful  whether my generation will come out alive from this ordeal, but I can only hope that the generations to come will have a better future then the one our parents made for us....
All we ask, for now, is that our previous regimes step down and admit their failure. No more lies, no more pampering, and definitely no more Salary cuts.

And the last thing we could care about, at the moment, is whether or not we will change currencies and exit the Euro zone. If that needs to be done to get rid of 30yrs of lies and wrong choices, then part of me feels, that needs to be done. Even if it means Greece leaving the Euro. Even if it will lead to a devaluation of our currency. Even if it destroys us for the next 10-20 yrs. Even if it will obliterate today's social structure.
As long as people are starting to awake from their 30yr-induced slumber, there is hope. And as long as we continue talking about it, I hope, we will find a way.

I know that the future is grim and I know that I have been forced by my own country , along with so many others, to emigrate somewhere else. I don't always like the fact that I am away from it all. But I also know that there is always a way do things.

And fortunately ( or unfortunately ) in a Democracy the majority decides.


"Hope is the last thing that dies out"


Pavlos

3 comments:

  1. This situation we are experiencing right now is not a crisis. Its a stare game whether we want a society for the people or a society for the stockmarkets.

    The media, as part of the market system, are in a frenzy trying to convince people that there is no life if we exit the eurozone. But they dont say what is waiting at the corner if we stay in these outragious false policies. More pay cuts, more taxes (for the poorer of course) more working hours without any of the working rights that were conquered through struggle and blood.

    As I read in an article recently why is this fuss all about. Why so much turmoil whether greece can pay off some private institutions. Why the stockmarkets in Tokyo or Hong Kong dive every day that greece is without official goverment. Because they dont fear if they will get paid. They fear that people will stand up and say that they will not pay.

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  2. The key point in your Analysis Pavlos is the part you mention: "For a large portion of the Greek population these prognosis say nothing. When you don't have a job or any possibility to find one, let alone in a field of interest; when you don't have any savings whatsoever and no support (family excluded) why in the world would you care about your currency or its potential devaluation? You don't have anything to lose!"

    The remedy in such a situation -for the specific case of Greece, of course- is fixing the problem and getting jobs and production back on tracks, not exiting Eurozone and devaluating the new currency. We have plenty to lose, even in everyday life. I'm just listing roughly:

    1. Energy. Greece imports energy from eastern countries. Since we do not produce oil, or exploiting our renewable resources so that we cover our needs, we depend on energy imports. Believe me, oil (for example) will be paied in USD, rather than DRX. Hence both public and individual needs will be harder to be accommodated.

    2. Greece should consume its products, since imports will be limited (back to the 80's, when a pair of Lewis jeans costed 50% of the basic salary etc). Since for example in agriculture we've managed to produce only 9% (that's right, no typo!) of our needs (instead of more than 90% of the late 80's), this means that there will be a period of time, until our production recovers, that Greeks will really suffer (and I mean REALLY, not like now).

    3. Intra-european trips and international purchases (for example through online markets) will become once more a luxury. Before claiming this point minor (which might be, I agree) think about your life. Don't forget the products you purchase from internet and that -even now- going to Rome and Paris for a weekend is cheaper than going to most of the greek islands! This is not a problem of Euro, rather an intrinsic problem of greek society, namely the lack of controlling mechanisms!

    I'm restricting myself to these, rather than speculating about foreign policy challenges etc. My point is the following: bullets 1-3 listed above SHOULD be faced if we want our economy to recover. Why is Euro restricting us? What is the advantage that Drachma would provide us in taking care of the above, apart from the fact that an employer who costed 1000 Euros (350.000 DRX) once in DRX would cost 500 Euros (receiving however the same salary: 350.000 DRX with 100% devaluation, which is an optimistic forecast)? How will invest in Greece, even with low labour costs, jeopardising his investment against a corrupted system? On the other hand, who's losing most in the previous example? The employee or the employer, who will see his salary (and hence his spending potential) halved in a day?

    Please help me understand guys...

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    Replies
    1. And, yes, I fully agree to the rest of your analysis and opinions! I just don't care about Euro or Drachma; only about recovering. And I think that Euro is a tool that could help us more than Drachma, IF we decide to fix our problems...

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