Socrates on Greek debt

“Crito, we owe a cock to Asclepius; pay it and do not forget.”  The last words of the famous philosopher have been much discussed.  Maybe he foresaw the Greek debt situation!  Nietzsche of course turned it to metaphorically mean death.   Others say it was Plato who was ill and recovering, Socrates heard of this and wanted to thank the God.    Or maybe he had already started having dellusions due to the hemlock and remembered an old debt.

But most take it literally.  Socrates, having eloquently stated his case in court, with cynical dryness and panache mentioned an actual debt to tidy over before he died.

 

Playing the Eurovillage idiot

This is not a political statement.  A lot of friends and business associates are calling me these days and I thought I should put together the kind of reassuring statement our government is not.  From a communications point of view the country is in chaos.  Nobody is controlling the agenda and -though improved – Greeks are still passionate political beings.  Social media doesn’t help.

There are two, equally ridiculous, conflicting conspiracy theories.  One is that SYRIZA is a pawn of Putin.  They are expecting the Russians or the Chinese to bail us out.  The far right is also on their payroll.  It is a plan to ruin Europe.  Funnily enough that is the target of the Americans too!  In the other conspiracy theory, the previous government was ordered to step down by the US and the new one is secretly working with the Americans now….in order to ruin Europe!

All this would simply be foder for the Facebook village idiot to rant about were it not for the fact that the new government is indeed the perfect tool for anyone wanting to control the Euro.  The unflappable Merkel has overseen six bail outs so far quite successfully.  She is treating us like a patient wise old aunt, waiting until we run out of money before she gets involved.   Greece however is the country in her EuroFamily that produces such extreme stock market reactions.   Greece is the “heart”of Europe, it is a symbol.   It seems to swing out of the spotlight and then back in again.   One crazy statement from Greece (with the appropriate amount of international media attention) and currencies around the world bounce up or down.

Our politicians don’t help.  The current government is naive, disorganised and bold.   That is a dangerous combination.   Our finance minister, much like our prime minister, seems to show a blatant disregard for most institutions.   This isn’t just about bright shirts or the lack of ties.  The new government is walking an equally erratic line within its borders when attacking the church or taking back promises it made to civil servants.   Alexis Tsipras could say “we will dig a trench and float off into the Mediterranean until we get to Cuba”and nobody would bat an eyelid.  We all know he will change his mind the next day.

So don’t worry about Greece.  It is best to treat us like the village idiot.  With patience, humour and the persistence we need.   All hopes of a miracle solution, whether inside the country or internationally, are simply confusing matters.  This country needs to work hard for many years to become competitive in the global economy.  There are many of us who understand this, unfortunately none of them make it to government.  In the meantime, Greeks will do what Greeks do best since ancient times:  from Persians to Philip of Macedonia, the first world war or Byzantium, we are always making conspiracy theories about how “foreign powers”are trying to destroy us…

Tolstoy and the Greek War of financial Independence

“War and Peace” is monumental in the way it helped create the myth of the united Russian people.  Despite its size it glosses over and completely avoids going historically where the narrative would be in conflict.  Important battles aren’t even mentioned and the massive diplomatic effort to keep the armies fed isn’t present.  The two years that follow what is in the massive book are far more interesting as the incredibly disciplined Russian army entered Leipzig and Paris backed by superior intelligence and diplomacy.  However a Tolstoy is exactly what Greece needs now, not a loan.

It was the amount proposed as aid that got me thinking.  Sure the zeroes at the end of it are dizzying and in many ways an awesome show of EuroFinanceFirePower.  But it seems that it is just enough to keep Greece ticking until just before the next national elections.  Makes sense you could say.  Get your shop in order and you get more help, Mr Papandreou.  No giving it all away to gain favours like your Dad was so good at doing.

And then there is the matter of financing risk spread.  How involved are European banks in Greek debt?  Hard to tell but if you average out the guesstimates it seems that the amount the European Union is proposing to lend is just a bit less that it would cost their banks if Greece defaulted, a lot of which are practically national affairs.  And of course if Portugal, Spain or any other similar economy went down not even the EU or World Bank could muster enough cash.

So let Greece crash please.  We need to face up to the debt and restructure it like so many other countries have succesfully navigated these past decades.  It will do us good.  During the War of Independence against the Turks, the spirit of teamwork was incredible.  Same at the start of the second world War.  People singing in the streets for joy and working together, putting aside differences and just working to a common goal.  Both those wars then had a bleak period of infighting and turmoil as “normality” settled in.  We need to shake off “normality” not invite it right now.

We need to face up to the facts.  This is war.  We need to rally up to the common cause instead of digging our heads in a hole.  And if the politicians can’t write a book as good as “War and Peace” we need inspiring figureheads to do as good a job as possible.  This article is in English because it is not my fellow Greeks that need to read it; fellow Europeans, please take the moral high road.  Don’t chicken out and use Greece as a delay mechanism for sorting out the real structural problems Europe faces.  The EU can survive Greece’s economy crashing but if we let the threat dehabilitate us, world financial markets will just keep playing the EuroZone like this forever.  Like wolves isolating stragglers in a herd of deer, it will never end.  Restructuring debt isn’t the end of the world.  Sure Argentina got ugly, but Belize, Uruguay and even Jamaica did very civilized jobs of it.  The work of people like Lee Buchheit(download an excellent paper on the topic here) shows us exactly how the alternative would work.  Sure, there is no way to exit the european union but just as we stopped using the drachma, we could reinstate it as an inbetween phase to recovery.  And if anyone wants an inspiring story of a people rising from the ashes in tough times, follow Wilma Mankiller’s story as she fought an urban war to get Cherokee people proud again on their terms.

One way or another, in five years Greece should be able to stabilize things.  But if we build crutches into the core of a newly born Europe now, the whole idea of a truly united Europe will not be able to recover for decades.  It wasn’t the Russian winter that beat Napoleon, that is just a convenient myth, like all the myths about ancient Greek superiority we keep on the backburner in Greece as an excuse not to actually work.

I am kidding of course.  Greece has major liquidity issues, bank structural problems and an unhealthy reliance on the public sector which is completely corrupt.   We need the loans but it would be great if we could organize ourselves to actually make the necessary changes without feeling some “foreigners” forced us to make them.   If Greece is forced to make these changes too fast, a whole nation will struggle to transform itself so fast.   We have no Tolstoy and no Churchill to lead and inspire us and the social connections in the country aren’t strong enough to keep it together while we mature.

 

Like a lot of important writers, Leo Tolstoy was excommunicated by the Russian (Greek Orthodox) church.  The day after this was announced students and workers paraded in his honour.  So if Fitch wants to grade Greek bonds BBB- (just above saying it is toilet paper!) I say let’s take to the streets in celebration too; if this bunch of people really puts minds and hearts to it, we can and should get great stuff done!