A perfect storm
‘Perfect storm’ and ‘endless crisis’ are not phrases that easily come to mind as you sit atop the Areopagus Hill, just west of the Acropolis, and watch the orange sun disappear improbably beneath the Saronic gulf.
It is a spectacle of such aching beauty that, each night from April to October, tourists from around the world and canoodling locals gather on the marble rocks, with their backs turned to the Parthenon.
It is a view that I had remembered and come to see—except that you can never really remember such extravagance, only hope to return to the well.
This is the Athens I have come to love over the last decade, with its ancient history and its arid hills, its fierce daylight and soft summer evenings filled with the floating sounds of bazoukis: a new antiquity to explore around every corner, and each sunset its own revelation.
But I found myself, this time around, having to pinch myself.
I wanted to remind myself that beneath the expanse of white roofs tinged with the purple of the dusk − beneath the entire greater sprawl of post-war Athens, laid out like a carpet beyond the agora beneath us − one in every four eligible Greeks in this city is unemployed. One in every two Athenian youths has no prospect of work.
The health and education systems are suffering from crippling under-funding and endemic cronyism. By some accounts, more than 40 per cent of all Greeks now live below the poverty line.
Hundreds of thousands of educated Greeks have fled their homeland, especially younger Greeks (the ‘brain drain’).
Well over half of the population register deeply pessimistic appraisals of what is to come. And, despite six long years of internationally-brokered economic adjustments, there is still no end in sight.
Feet on the ground
It is hard to gather too much ‘on the ground’ when you are only in a place for a week, spending your days at a conference, with a limited functional command of the native language.
The young Greeks I have spoken to, it has to be said, remain refreshingly optimistic. “Greeks will always find a way,” one told me. “What else can you do? Greeks have always found a way.”
“I do not want to talk about the crisis,” another reflected. She had for some years previously run a tour around the ancient sites. Everyone seemed more interested in the Greece of today.
“It is better we are optimistic, isn’t it?” We nodded.
The taxi drivers are, as ever, a more interesting sample. I pressed one about Greek President Alexis Tsipras, who had come to power so dramatically in January 2015 promising a “better deal” for Greece from its EU creditors.
“Tsipras is a great actress,” he laughed quietly, although he clearly did not find the situation amusing.
“Tsipras deserves an Oscar,” a second cabby rejoined, unbidden. “He deserves some reward for all the lies he has told.”
Moving around the tourist areas at the feet of the Acropolis, with young and old reclining on the endless café chairs, you could be forgiven for thinking that nothing could ever change in old Greece.
The young people are still fashionably attired. They move around with the same insouciance as ever. The young men, especially, engage in heated, laughing exchanges.
But at Monastiraki, it seemed to me that one in every three shops is closed in the touristic ‘Flea Market’ that I remember being a hive of activity less than 10 years ago.
There seemed to me to be many fewer tourists than I remember from 2007 or even 2010. The Plaka still bustles at noon. Monastiraki chokes with celebrants in the evening. But on one park bench near the Thesion, I saw a man lying asleep, uncovered in the rising morning heat. The previous night I almost fell over another homeless man huddled in a doorway, his eyes opened wide.
Beggars are another new presence I don’t recall from previous trips. Some − as in India − have gross deformities (one man’s arm was almost wholly scarred with burning). Each asks − as in India − for any charity that might be passing by.
But then again, since I had first come here with a friend in 2007 pursuing the Greece of Socrates, Pericles and Thucydides, a good deal has changed in the Hellada of the ‘troika’, austerity, the memoranda and the referendum.
After 2009, caught in the wake of the global financial crisis, Greece’s GDP has shrunk from over €240 billion to under €180 billion. GDP per capita has fallen nearly 25 per cent from €22,500 to around €17,000.
The public debt that caused the storm has not shrunk. It has now grown to an estimated (conservatively) 180 per cent of GDP. Indirect taxes have multiplied, with all that implies for social equity. Public assets have been privatised: at the moment, even the Piraeus is up for sale.
The health and education systems have been ‘defunded’, triggering humanitarian concerns and tales that sound like they come from the third world.
Then, in 2014, refugees from the Middle East began to come in their boats. At first to pass through Greece northwards. But then −when fences arose and the borders closed − awaiting a decision on their fate in this half-impoverished land.
In the 1930s, the Philhellenist Albert Camus used the title ‘Greece in Rags’ to describe the impoverishment of the indigenous populations of the Kabylie region in the Algerian highlands. Today, he might have used the same term to evoke the original he passionately loved.
Much has been written on the causes of the Greece ‘sovereign debt crisis’. Even the most ardent Graecophile would be hard pressed to deny that there are not domestic, as well as international causes to today’s imbroglio.
Greece’s successive social democratic (PASOK) and liberal-conservative (New Democracy) governments all ran budget deficits since the emergence of the democracy from authoritarian control in 1974, until SYRIZA’s advent in 2015.
The deficits were under three per cent before 1980. They were over three per cent since then, culminating in about nine per cent per annum in the 2001-2009 period when other economic indices were still heralding Greece’s ‘Olympian’ four per cent growth.
Since the reign of PASOK in the 1980s (if not before), clientilism has become an accepted part of Greek politicking. In a way that makes Australian politics look mild, the parties here have competed in offering largesse to particular electoral groups. Budget deficits have regularly increased in election years as the public’s purse strings were advertised and opened.
After 2004, public servants’ positions became life-tenured, attracting a whole series of bonuses alongside this enviable guarantee of permanence.
Greece was rated the lowest of the EU nations in the Transparency International Corruption Index in 2010, scoring only 36/100.
As everyone will know who has spent some time here, a flourishing ‘informal economy’ continues to exist − estimated by some to be as large as about one quarter of Greek GDP. Tax evasion has become for many older Greeks an established point of ‘tradition’ or ‘cultural difference’ − especially among the large proportion of Greek sole traders and very small businesses, including farms.
As one of my philosophical cabbies genuflected (he was about 50): “My generation will perhaps pay half their taxes, then the next generation will pay three quarters. But in two generations, the young Greeks will all pay, and things will get better.”
Economists estimate that by 2010, the Greek government was losing up to €20 billion per annum on unpaid taxes.
Next year, in Brussels
Yet we should beware of assigning the Greek crisis solely to those ‘lazy Greeks’, who economic figures suggest work as many hours −those that are employed − as nearly anyone else in modern Europe.
In many ways − as so many times before in the nations’ long histories − the Greek situation holds up a mirror to Europe, and perhaps to the wider world, of larger changes and tendencies afoot.
Take first the famous, crisis-triggering announcements of the PASOK government in 2009 that the Greeks had systematically under-reported their level of government debt − from ‘six to eight per cent’ of GDP (as estimated by the conservative ND government) to 12.7 per cent, announced in May 2009 (a figure given by Papandreou and PASOK that was finally revised to 15.7 per cent).
Like the calculations about Greece’s budget deficit that allowed the country to enter into the eurozone in 2001 − calculations whose means and numbers are still disputed − the Greeks had apparently been practicing the same kinds of recondite accounting arts that had led the American investment banks into such infamous trouble in 2007-2008.
In 2000-2001, the Hellenic government had in fact availed itself of Goldman Sachs’ esoterikes technai (refined or secret arts) to hide some €2.8 billion of debt in ‘currency swaps’.
But consider next how in a larger sense, the Greek situation casts the tensions inherent in our notion of ‘liberal democracy’ into the kind of crystalline light that streams down from the sky in this country in the summers − alongside, of course, the manifold tensions in the notion of the European Union as it has evolved in successive waves since the end of World War II in 1945.
Commentators from the start pointed to the potential problems in the idea of the common currency, in a continent so economically diverse.
The problems come from the disconnect between nation-based governments retaining their fiscal powers over taxing and spending, while losing their monetary autonomy to the larger political-economic union, and its central banks.
Nations in economic trouble, like Canada in the 1990s or Iceland after the GFC, have traditionally been able to unilaterally devalue their currencies. This has the happy effect of simultaneously devaluing any debts held in that currency − a situation which can also lead to its own problems, as the Weimar experience shows − and making that country’s exports more internationally competitive.
But when it became clear in 2009-2010 that Greece was in serious economic trouble, with unsustainable government debt and an increasingly uncompetitive national economy, the Greek government that had spent so liberally and taxed so ineffectively had no capacity to devalue the euro.
Instead, as the whole world knows, the Greeks were forced to go cap in hand to the International Money Fund, the European Commission and the European Bank (known colloquially as the ‘troika’).
The ignominious task was to ask for yet further loans, in order to service the debts the Hellenes had up to this time publicly accumulated, and reassure the creditors that a massive default (Greek basically declaring itself bankrupt) was not to occur.
At this moment, all the tensions between the ‘liberal’ and ‘democratic’ in our phrase ‘liberal democracy’, held at bay when times are good, emerged fully and clearly.
Greece wanted, and still wants, largely, to be European, internationalised and economically ‘liberal’.
It wants to spend the cultural capital its history affords it, as well as to enjoy the economic benefits of participating in the European Union: benefits that, in the form of cheaper loans, flooded the country post-2001.
Yet, to accept the ‘bailout’ deals, and what has become, since 2010, not one or two but three memoranda worth hundreds of billions of euros, the Greek government had to accept a sizeable political-economic slap on the wrist. Indeed, the better metaphor here would be handcuffs, if not what Max Weber and Andrew Gamble have differently dubbed an ‘iron cage’.
The slap or the cage was called ‘austerity’ (austerotes, litotyte).
‘Austerity’ is the same combination of privatisations, depressing of real wages, cutting back on public sector expenditure, deregulation of labour (or ‘opening’ of ‘closed’ labour markets) that the IMF had visited on debtor countries across the global south for three decades. With Greece in 2010, ‘austerity’ had found a bridgehead, through the Mediterranean periphery, into Europe itself.
Freedom coming our way?
The condensed sequence of the left-wing Prime Minister Alexis Tsipras calling a referendum on whether the Greeks would continue to accept austerity in late June 2015 (as default on memorandum 2 loomed imminent); then getting a resounding 62 per cent ‘OXI’; then going to Brussels to negotiate that ‘better deal’, before returning to Athens by August with Memorandum Mark 3 which had traded wage cuts, new indirect taxes, further promised privatisations and labour-market deregulation …
All this neatly captures why ‘liberalism’ − or, rather, for this is a dangerously overused term, what is called the ‘neoliberalism’ that emerged ascendant in the West after 1975 − has always been an uneasy bedfellow with democracy.
While democracy indeed emerged in classical Greece, history after all tells us, liberalism emerged somewhat later − in the 17th century, in fact.
For well over two centuries it worked well enough without universal male (let alone female suffrage). ‘Neoliberalism’, spawned in the 1940s, only came of age in the 1980s.
In 2015 and 2016, in any event, the home of democracy has been taught that its ‘yea’ (Nai) or ‘nay’ (Oxi) − whether on the Pnyx Hill or in the ballot box, the Areopagus or the Syntagma − now means materially very little. When one is in debt, one must pay. And while we may wax lyrical about Pericles or the Pnyx, Greece’s European creditors amount in effect to a second, deciding constituency that Tsipras or any subsequent Greek prime minister must now win and woo, beyond the Greek people themselves.
Indeed, 2015 showed that it is this second constituency, unelected by the Greek people, which for the foreseeable future casts the deciding vote.
Athens, Melos …
Although I love the Greeks, it is unconscionably kitsch to make too much of the comparison of Periclean Athens and Papaendreou’s, Tsipras’ or Mitsotakis’ beleaguered capital.
Democratic Athens, also an imperial power, arguably has a bit more in common with today’s Brussels or Berlin, having set itself up as the leader (hegemon) after 480BC of a kind of Aegean protection racket against the (soon-fading) Persian threat.
Today’s Athens seems indeed to me much more like the little island of Melos which, Thucydides reports, tried in vain to rebel against its imperial overlord in 416BC.
In the background was Athenian anxiety about a ‘domino theory’, incidentally: the idea that if the Melians were allowed to abdicate from the Athenian League, what might the other member-cities venture?
When the Melians appealed to justice and the right to preserve their sovereignty against the hegemon, the Athenian emissary explained to them unceremoniously that the Great Law of the world is that might makes right: “The strong do what they can and the weak suffer what they must.”
The Athenians did not discover this law, they counsel and console their debtors. But if the Melians found themselves in the Athenians’ shoes, they would apply the same principle of violence to their present oppressors. As someone more recently said, ‘there is no alternative’.
The alternative the Melians faced in 416BC was complete surrender or the utter destruction of their polity − a proposal the Athenians were soon to make very real, on the way to their own decline and fall.
Now it would be unfair on Greece’s creditors to suggest a too-direct comparison between them and Imperial Athens at the point of its imminent decline, talking freedom and bringing the swords and the triremes.
After all, the Greeks’ 2015 referendum was allowed, if subsequently ignored. Perhaps − as some Greeks will tell you − it was conceived by Tsipras as a last hopeless instrument to try to ‘leverage’ something not recessionary from the northern hegemons.
That said, like the great prow of the Acropolis that surges east into the blue, the Greece of 2016 allows us to see clearly that we are all entering a brave new period in global political life − one in which the liberal-democratic compromises that characterised much of the 20th century seem set to come apart.
It is a situation which, romance aside, is not without profound attendant risks, notably those of the populism of the far right, represented in Greece by Golden Dawn (Chryssi Avyi), turning legitimate grievances about loss of peoples’ democratic sovereignty today into calls for radically illiberal forms of identity politics.
What peoples will occupy this world, and whether this will be a democratic, a plutocratic, or a new postmodern authoritarian era remains to be decided.
Matthew Sharpe is an associate professor in philosophy and teaches classical Greek and Roman philosophy at Deakin University.
This story was originally published in theconversation.com