The Prodigal Greek

The Greek crisis through a different prism

It is on the streets that Greece’s fate will be decided

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“Considering the state of the Greek economy, which three of the words below express more accurately your feelings as a Greek citizen about the present and the future of the country?” This is a question in one of the two recent opinions polls in Greece from established pollsters MRB and Public Issue (links in Greek).

Disappointment (65.6), rage (64.1), fear (48.1) and shame (38.4) are by far the four prominent sentiments in Greek society at the moment, according to MRB. Compared to the results when the same question was asked for last December’s poll, rage has shown a significant increase, from 51.4. The sentiments of submission and resignation in last year’s poll appear to have turned into anger this year.

On the purely political aspect, the two opinion polls give the leftish party of SYRIZA a lead over New Democracy, re-affirm the establishment, although having lost momentum, of the menacing Golden Dawn in third place, and the slide of PASOK between fourth and fifth place in single digits.

It is the social aspect of the polls that make the alarming reading.

In Public Issue’s survey, 75% of respondents think that the country is heading in the wrong direction, while 69% are against the Memorandum of Understanding with the troika and the implemented policies, from 61% before the June elections. The opinion Greeks have of the European Union has deteriorated from 61% positive before the June elections to just 46% in December, with negative opinions at around 50% consistently since October.

MRB’s biannual trends have a more extensive assessment of the current social environment. A combined 94.6% are of the opinion that things in Greece are going badly, with 71.6% of those considering the situation “very bad”. Not surprisingly, when asked about the economic situation in the country. 95% finds it bad, with 71.4% very bad. With regard to their own financial condition, 81.5% of respondents find it bad, with 50.5% very bad. Women, the 25-34 age group and inhabitants of Athens are most pessimistic about their personal finances.

When questioned about how they see the economic situation in the country over the next 12 months, 86.4% think it’s going to get worse, with 58.8% significantly worse. With regard to their personal financial situation, 81.2% expect it to get worse, 54.2% significantly worse.

When asked about the country’s three most significant problems, irrespective of their impact on personal conditions, unemployment by far dominates the responses with 73.7, followed by expensive prices at 40.2 and healthcare now takes the third spot with 36.5, from the fifth place in December last year. This reflects the serious challenges the Greek state is facing to provide health services and the ongoing dispute between the government and pharmacists over unpaid arrears, which on many occasions has led to pharmacies refusing sales on credit, forcing patients to pay for their medicines in cash up front. Economic immigrants are down to ninth place with just 8.3, something that is in conflict with the rise of Golden Dawn and its xenophobic rhetoric.

In line with the statistics released by the Hellenic Statistical Agency (ELSTAT) each month, unemployment torments men and women equally, primarily in the 18-24 age group, with the inhabitants of Thessalonilki, Macedonia and Thrace regions facing the biggest employment challenges. The over 65 age group, whose pensions have been repeatedly cut, is most worried by expensive prices. Residents of Thessaloniki, Macedonia and Thrace are also particularly troubled by the cost of living. And as expected, elderly over the age of 65, especially those living on the Ionian and Aegean islands have by far the most concerns over healthcare.

These are the sentiments of a society that next year will see 4.9 billion euros taken away from pensions and social benefits, 1.2 billion euros from public sector wages and 465 million from healthcare. A total of 9.4 billion euros of spending cuts is expected in 2013.

Unemployment already reached 26% in September and unless something changes dramatically in the new year, it will be edging towards 30%, the research institute of Greece’s largest union, GSEE, is estimating a figure of 35% in unofficial numbers. Approximately 771,000 of those are unemployed for over a year with no unemployment benefits and medical coverage.

Greek society has seen its income reduced by a quarter since the crisis started and its purchasing power return according to some estimates back to the early 80s from a combination of wage and pension cuts and the stubbornly high prices, a product of the distortions in the Greek market and oligopolies that have the power to control price levels.

Over 30% of the Greek population, according to Eurostat, is hovering around the poverty line and 15% cannot afford even basic commodities. Seven in 10 homeless Greeks lost their home in the last two years and the same percentage has been sleeping rough for more than one year according to a recent survey by the Klimaka NGO.

This is a society that feels completely disconnected from the state and domestic politics, whom rightly it considers responsible for the county’s demise.

This is the society that is expected in the new year to do yet more heavy lifting and go through the sixth year of economic depression and the fourth year of tough austerity.

Some of the key principles for successful reform programs according to a Deutsche Bank study of previous episodes is that the government must have the majority of the electorate on board, while reforms require persistence and they take a considerable amount of time to implement and bear fruit.

As much as there is every reason to breathe a sigh of relief for the approval at the recent Eurogroup of the release of Greece’s next loan tranche, considering the scenarios if outcome had not been favourable, the hard part for the coalition government is still ahead.

In the limited space that it has to manoeuvre given the recessionary policies that it has committed to implement, it must turn its focus on the Greek society and explore every possible avenue to soften the blow of what is to come next year for large parts of the Greek population. A recently agreed scheme to use EU funds to provide medical care to 100,000 long-term unemployed and members of families that live below the poverty line and have lost access to healthcare is one such initiative but at the moment is just an isolated case. It needs a coordinated, well-structured and persistent effort so the state resumes its role of welfare provider for those in need and not a technocratic body that only cares about balances and executes the demands of the troika.

No democratic government has managed to stay in office without the consent of the governed. Greece’s coalition is playing against even more unfavourable odds as it has to continue the implementation of the most severe fiscal consolidation a country has seen in decades.

In his first months in office, Prime Minister Antonis Samaras put all his focus outside of Greece to win over suspicious European leaders, suspicious due to their experience with previous Greek governments and his own rhetoric during the two years he spent in opposition.

Now it is time to shift his attention inside the country because the fate of his government and Greece will be decided on the streets and not by tranches.

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Written by Yiannis Mouzakis

December 18, 2012 at 9:14 am

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