Sharing the pain. Now everyone is against Greece! I admit that this column has not employed the most tender of terms in its assertion that the Greek state must radically transform itself in order to meet the conditions for staying in the eurozone on a long-term basis (see this editorial in the previous issue). Other positions taken have been even more negative and harsh. Alain Lamassoure, the chair of the European Parliament budgets committee, has expressed his “anger” by stating: “Certainly, there are a lot of Greek people who are suffering. Certainly, the sacrifices that they will have to make are painful. But these are because of their past excesses. And there is no point shirking one's responsibility. It is not Europe that is impoverishing Greece; it is Europe that agrees to come to this bankrupt country's aid. Since 1980, Greece has received tens of billions of euros in aid and what has Greece done with it? Why do Greeks pay fewer taxes than other Europeans? The Greek constitution exempts the richest citizens from paying taxes, the ship-owners? A tax on land has been set up, but the Greek Orthodox Church, the biggest landowner, enjoys privileges in this context.” (Le Monde, 4 November).
According to Jean-Marc Forneri, a financial inspector in France, “for 15 years, all Greeks have been responsible for setting up and operating a tax evasion system: tax fraud, but European subsidies and statistics are also involved”. He concluded that “the austerity plans adopted are worthless in so far as Greece is incapable of collecting taxes”. I could provide a lot more quotations on this, applicable also to the economic recovery projects supported by the European Commission and the EIB.
Obeying the rules or returning to the drachma. It is becoming clear that Greek political forces are now agreed upon applying the plan devised in Brussels but we have to ask ourselves whether they will be able to respect the conditions contained in this plan. A number of calculations that I have so far been unable to verify indicate that Greece receives €3 billion from the EU every year under structural and agricultural aid (1.3% of its GDP). Nonetheless, a significant part of this aid has not yet been used, despite measures taken in Brussels to authorise its use and even though there has been no parallel funding at national level which is, in principle, compulsory. I have already emphasised that it would be totally inefficient to try and force Brussels to make any more concessions because the failure of the single currency in one country has repercussions in the whole zone and even at the global level. It is not by chance that recovery in the eurozone was the first concern of the G20 summit.
If the new Greek government of national unity does not manage to radically overhaul the way the country is managed and the way it operates, and to convince the Greek population of the need to meet this demand, the country will have to return to the drachma. The option to reject through a referendum the European plan that was defined in common, together with the obligations that the plan involves, would have meant giving 11 million Greeks the right to decide the destiny of around 300 million Europeans in the eurozone. Claiming that the possible referendum would be based on Greek participation in the eurozone was therefore justified. For the time being, let's leave aside the observation made by legal specialists that a country leaving the eurozone (which is not provided for in the legal texts) automatically involves this country leaving the EU at the same time, and let's leave their finding a way to avoid this exit from the EU which, according to one commentator, “would take Greece back into what was previously called the third world”.
Two crucial situations. The previous considerations are factual observations. Nevertheless, it should be admitted that the Greek population as a whole, finds it difficult to understand or accept them. Nonetheless, two situations do exist: one affects the immediate future and the other is hypothetical but both of them are crucial. The first is simple: at the beginning of next month, Greece will be unable to meet its immediate spending commitments (civil servants' salaries, pensions, other public spending) if it does not obtain the next payment from the EU/IMF. The second situation is that if Greece had to leave the EU it would have to deal with issues such as illegal immigration at the border with Turkey from his own resources.
There is a trend in public opinion in Greece and elsewhere that is in favour of leaving the EU rather than agreeing to rules imposed by the euro. I am still in favour of leaving the door to exit the Union wide open for any country that would like to leave, no matter what the legal obstacles would be. But I also consider that any member state has the right to remain within the EU if it so wishes. Participation in the eurozone is inevitably subject to respecting the rules of this zone, which have been set out in common.
The case is still pending. This opinion is obviously applicable to all eurozone member states. Greece is not the only country that has been failing. Italy is a cause of concern and this column will be returning to this issue. (FR/transl.fl)