Everyone knows that the Greeks invented tragedy. It was a type of theater at first, but now it seems like it’s quite a popular practice all over the globe, with many tragedies unveiling every day: wars, refugees, natural disasters, etc. While many modern tragedies still involve “theater”, that is a story for another day. Let’s take a look at one of these from two different perspectives.
1893, a young southern European nation declares bankruptcy. But what led to this demise?
More than fifty years before, Greece was in an urgent need of funds in order to help supply the revolution against the Ottomans. As a result, Greeks had to take a loan, to keep the war going. When Greece finally managed to get its independence some years later, the banks were empty. Thus, they had to resolve to another loan. This loan policy continued on for many years, because it seemed, at the time, as the only way of maintaining rapid growth in a country that had recently been created from nothing.
During the 1880s, this endless cycle of borrowing reached its pinnacle. At this point, the loans were not just to invest in infrastructure and assimilate growth, but to cover budget deficits. The loans also helped pay previous loans back. Of course, some of these funds, “magically” disappeared in the hands of the government. A statistical analysis reveals that only a fraction went to fund new investments.
Soon, the debt reached numbers almost double of Greece’s GDP at that point, so going bankrupt seemed as the only safe option. Well, at that time, bankruptcy was not that unusual. However, it had a major political impact in the future. You see, the foreign powers agreed to help this nation, but there was a catch: From that moment on, these countries would decide on how the nation will be run.
This “help” later became known as the “Commission Internationale Financière”. The foreign powers started their operation in 1898. What did these nations do to help? They took absolute control over key sectors such as the salt industry, mining, seaports and the minting of new banknotes. They also covered some expenses on their own – but charging Greece credit. Basically, this commission had almost absolute control over the country for the next few years.
Some years later, the results were positive. These powers managed to sort the economy out, cut all unnecessary expenses and inefficiencies. At 1910, Greece emerged again with a steady pace of growth.
But, at what cost? Firstly, while the commission was sorting the economy out, people were suffering. Budget cuts to key sectors made the life of poor and middle income families even worse and many opted to leave the country in search of a better future elsewhere. At the same time, the rich became richer and huge banks and companies replaced smaller ones or were bought by the elite that ruled the nation. Nationalism also arose, proving disastrous for Greece some years later.
Recovery took many years to finally occur, and factors, such as the two world wars, made it even slower.
So was it truly a success? That’s still debatable.
Does all of the above sound similar to what’s happening now? It definitely does. Let’s take a look at the story from a modern perspective.
After the end of the dictatorship in 1974 and the unfortunate occurrence of another disaster on the island of Cyprus, democracy was reestablished. This time, the funds to assimilate growth and the goal of European integration were indeed scarce. So, the only option was, again, to take a loan.
From that moment on, everything seemed great! Greece entered the EU, growth reached unprecedented rates, the Euro was adopted as the new currency and people had money to spend on their vanity. We hosted the Olympics, won the European Football Cup and the Eurovision Song Contest, and everyone was ecstatic about the “European Dream”. What could possibly go wrong? Everything seemed perfect. It was believed that soon, Greece would become as rich and well structured as Sweden, and warnings of an upcoming disaster were simply ignored. It seems like this disaster was years in the making before it occurred, shortly after 2008. During the 1990s, this endless cycle of borrowing had reached its pinnacle. At that point, the loans were not just to invest in infrastructure and assimilate growth, but to cover budget deficits as well. The loans also helped fund the “European Integration” and pay previous loans back. Of course some of these funds, “magically” disappeared in the hands of the government.
Soon the debt reached numbers almost double of the Greece’s GDP, but going bankrupt was never an option for a European country, was it? It would deter its growth, stain its prestige, and Europe surely couldn’t allow that to happen. Another solution had to be found and soon enough a master plan was devised to help Greece. However, it had a major political impact for the future. You see, the EU (through the European Commission and the European Central Bank) and the IMF agreed to help, but, there was a catch: From that moment on, these two would decide on how the nation will be run.
This “help” also known as “Troika and its many Memorandums”. The foreign powers started their operation in 2009. What did they do to help? They took absolute control over sectors such as healthcare, social insurance, pensions, exports and many more. All of these sectors are the pylons of the economy and employed thousands of people. They also decided to take a loan from the IMF and the EU to cover the expenses, or what is best put as “agreeing to a bailout program”. Who agrees, exactly, is still a mystery. Essentially, the EU and the IMF will have almost absolute control over the country for the next few years or possibly more.
The results are obviously negative and are observed every day now. They managed to worsen the economy. At 2015, even though the nation is still experiencing the financial crisis and paying back loans represents an unknown part of the total income, Greece still has a negative budget and a steady negative pace of growth.
But, what is the cost? Firstly, while the “Troika” is sorting the economy out, people are suffering. Budget cuts to key sectors make the life of the poor and middle income families even worse and many opt to leave the country in search of a better future elsewhere. At the same time, the rich are becoming becoming richer. This elite are, essentially, puppets for foreigners, who are “investing” in the Greek economy by buying everything and firing the employees or threatening to do so if they disagree with the new order of things. Nationalism is also on the rise, while one of the worst disasters of modern European history occurs, which is of course the refugee crisis. Recovery will take many years to finally occur, if it does, and factors such as the constant instability in Greek politic are not helping.
So is it truly a success? That’s still debatable.
As the Greek people are once again called to vote in Parliamentary elections today, on the 20th of September, it seems like history always manages to repeat itself. The same mistakes have lead to the collapse of the Greek economy and the downfall of the people with it. This time, however, the stakes are high and the future of the EU is in danger. The elections surely won’t change anything. The problem will still be there, no matter what the outcome is.
As long as the major political parties (All 9 of them, except the Neo-Nazi one) don’t agree to work as one to save the country, because “it violates their beliefs”, things will not change. Practices such as controlling the media and urging people not to vote for a certain party disregards the true essence of democracy, and the very people who created it. No matter what you vote for, parties act as if they have no accountability on the issues they have to deal with. Greeks want to believe that the ones who govern them are here to help their nation, not their bank accounts.
But then again, it’s easier to keep a flock of mindless sheep happy, isn’t it?
I suppose George Santayana was right when he said “Those who cannot remember the past are condemned to repeat it”.
This article was inspired and contains some sources from the book “Subjects of Neohellenic History” written and distributed for free by the Greek Ministry of Education for all humanities students in Senior High Schools. The rest comes from various Greek and International newspapers that report on this subject. Please note that opinions and experiences are included, but in general this article mostly reflects public, rather than personal ones.