The fight to end Greece’s Great Euro Depression

Nikos Athanassiou, a 61-year-old Athenian pensioner, is at the heart of Greece’s struggle to maintain its fragile 14-year membership of the euro.

Like many of his compatriots, Nikos took early retirement having worked most of his life labouring in the country’s now defunct construction industry, aged 58.

He is one of the 2.6m pensioners in Greece who have become the unlikely battleground in the latest game of brinkmanship between the radical Left government and its paymasters.

A member of Communist Party of Greece (KKE), Nikos spends his retirement resisting Troika-imposed cuts to public services as a union representative for his local district in northern Athens

“It is my duty to demand dignity for Greeks. We are collapsing as a country,” says Nikos.

His resolve is not unusual in a society where the bulk of proposed cuts will hit the elderly and newly retired.

“Without work, you don’t have the right to a proper life.”
Nikos Athanassiou, 61

The International Monetary Fund isdemanding the Greek government slash €1.8bn in pensions spending in 2016.

At 16.2pc of GDP, Greece’s outlay is highest in the eurozone.

Even with overhauls to the retirement age and spending cuts, this will still only fall to 14.3pc in 45 years time – the third highest in the European Union.

Nikos’s pension is €750 a month. He is among nearly half of all Greek pensioners who provide the sole source of income to support three generations of one family.

But his pension is barely enough to provide for his seven-year old granddaughter and her parents.

“When I think about my granddaughter’s future, I panic. I want her to live in an independent Greece – not a protectorate.”

Squeezing blood from a stone

Resentment against creditors’ determination to suck more funds from the country’s pension system is rife.

Greeks have already seen a 40pc fall in their pension provision over five years – a shrinkage that has been ruled unconstitutional by the country’s highest administrative court. One of the reasons the spending ranks so highly is due less to generosity of individual pensions than it is the extreme recession that has shrunk GDP to almost pre-euro levels.


Greece’s radical Left government has vociferously defended pensions as one of the last remaining safety nets in a country where 45pc of the elderly live below the poverty line.

The issue has become the immovable “red line” in Greece’s struggle to finally end what the ruling Syriza party have dubbed a “ritual humiliation.”

For Nikos, the struggle is at the heart of what it means to be a free citizen.

“Without work, you don’t have the right to a proper life.”

“People in Greece can’t even fall in love anymore – they don’t even have the money to go and do that.”

But he is still one of the lucky ones. Many of his fellow construction workers failed to qualify for their pension having lost their jobs when the money ran out and the cranes ground to halt in 2010.

His 60-year old wife also receives no state support. She spent her working days as part of Greece’s vast informal economy, doing odd-jobs and babysitting local children.

The Great Euro Depression

Evidence of Greece’s ageing society pervades Athens, where the population has fallen by 15pc since 2008.

With the country’s bail-out future due to be decided by June 30, the capital once again thronged with anti-austerity demonstrators this week – the first major rally since the radical Syriza government took office earlier this year.

The protest was a far cry from the fierce and often violent demonstrations that marred the capital at the height of its debt woes three years ago.

• Desperation forces Greeks back on to the streets

Older Greeks outnumbered the young. Anger was displaced by a weary resignation among some placard holders and drum-beaters in Syntagma Square. A sleepy carnival atmosphere pervaded on the eve of another last-ditch attempt by eurozone finance ministers to save the country from default.

Five years of lurching from crisis to crisis has seen Greeks acquire the steely stoicism more associated with their northern European counterparts.

“I’m back here after four months” says placard holder Dimitrios, 52.

“Nothing has changed – it is as if they were joking with us back then,” he says, referring to a provisional agreement between the government and its creditors on February 20.

• European authorities forced to stave off Greek banking collapse
• Greek debt crisis is the Iraq War of finance

Popular support for the euro is creaking as the economy is thrown back into turmoil.

More than 210,000 Greek families have applied for meal coupons and free electricity since Syriza launched a humanitarian aid programme in April.

The jobless rate is also creeping up. Over one out of every four Greeks remain out of work.

Of the hordes of unemployed, over 70pc have been without a job for over a year. Athens and its environs hold the ignominious title of the long-term unemployment capital of Europe – worse than the poorest parts of rural Slovakia and Latvia.

Nominal GDP is now set shrink to its lowest level since 2003 this year, the riches of its early euro boom years all but wiped out. It is the deepest depression suffered by any developed economy in the modern era – eclipsing that witnessed in 1930’s America.

Detractors across the chancelleries of the eurozone decry that the economy had finally begun to turn a corner before the Leftist government vowed to rip up its austerity settlement.

But Greece’s economic slide pre-dates the election of Syriza in late January. The economy contracted by 0.4pc at the end of 2014. Output is now set to fall by 1.5pc in 2015, according to Standard & Poor’s.

Sowing the seeds of hope

The bloated public sector has been in the firing line of the efficiency drives demanded by Greece’s bail-out chiefs.

Unlike their parents and grandparents, the current crop of young Greeks no longer have the option to spend their working lives as salaried employees of the state.

Many have chosen to migrate. More than 200,000 have opted for the path of flight in search of better prospects in the European capitals whose governments now stand in the way of a compromise with Greece’s Leftists.

Of those who have chosen to stay are a wave of entrepreneurs whose ambitions extend beyond enjoying leisurely office hours and early retirements of yesteryear.

Athenian Dimitris Koutsolioutsos left his family’s international jewellery business, Follie Follie, to establish the Farmers’ Republic – the first organic farmers’ market in Greece in 2014.

The enterprise aims to revive the “romantic notion” of establishing a direct link between Greece’s small fruit and vegetable farmers and their customers, cutting out the middle-men of the country’s entrenched cartels.

Dimitris Koutsolioutsos is fighting against cartels in the agarian industryDimitris Koutsolioutsos is fighting against cartels in the agarian industryFarmers Republic has a network of more than 300 organic small producers and will be opening its first market in Geneva later this year

“We’re a disruptive initiative”, says Koutsolioutsos. “When I started, I received death threats from the mafia who have controlled the fruit and vegetable industry for years.”

Despite only being 10 years younger than the country’s rookie prime minister Alexis Tsipras, Koutsolioutsos voices frustration at the stunted ambitions of the radical government.

The 30-year-old says he has received no help in overturning the vested interests that dominate agrarian industries in Greece.

“Ministers tell me privately they love what I’m doing, but can’t come out and publicly support anything which is seen as going against the cartel.”

“Farmers in Greece can just go out on the street and sell their produce without a license. That represents a loss of around €150m in revenues a year for the state.”

His complaints are commonplace.

When they stormed to power with nearly a third of the vote, Syriza vowed to overturn the parasitic cliques that have long dominated Greece’s social and political fabric. But uncertainty over the country’s bail-out future has taken priority over the nascent reform plans.

Tsipras has already met with his German counterpart Angela Merkel more times in the last five months than any of his recent predecessors.

In February, one hopeful Greek entrepreneur took to Twitter to ask the country’s finance minister to implement reforms that would help small businesses “propel” Greece’s growth potential.

Yanis Varoufakis responded: “Send me proposals. Asap.”

But much of the optimism associated with the first radical Left government in post-war Europe, has quickly dissipated.

The negotiating deadlock has seen business investment stall. Greek banks now teeter on the edge of insolvency as cash flees the country. Deposit flight has hit €1bn-a-day as the June 30 day of reckoning beckons. Without a new deal, Greece will officially exit its bail-out programme and need to pay back €1.6bn of loans due to the IMF at the end of the month.

The economy has entered a period of “septic shock” warns Michael Jacobides, professor of Entrepreneurship at London Business School.

The private sector has fallen into reverse gear. On average, 59 small businesses are having to shut up shop every day, with more than 600 jobs being destroyed with them.

Of the handful of flourishing start-ups, almost none have been able to access to bank funding, relying on family and friends for they capital need to kickstart their ideas.

Mother of one Ellie Rountou-Veremis gave up her career as a fashion stylist to set up the Sun of A Beach towel company with a school friend in 2012.

“I’m sick of Greece being the black sheep of Europe”
Ellie Rountou-Veremis, 36

Like many young entrepreneurs, leaving the euro is not a fate she is willing to contemplate for family or her company.

“I don’t even want to think about it.”

“Still, I’m sick of Greece being the black sheep of Europe.”

Her attitude sums up the great paradox of Greek public opinion as the country’s endgame approaches.

One recent opinion poll asking Greeks if they would opt for the euro or drachma, found 68.5pc still favoured the single currency. But support for Syriza also remains steadfast.

Shock therapy

Contrary to the intransigence on show from their creditor powers, demonstrators in Syntagma Square remained convinced of an 11th hour show of benevolence from their European partners.

“Greece is too important to let go. We are fighting for the future of all the people of Europe, not just our own”, says 18-year-old Leftist protestor Yiannis.

The prospect of an ejection from the 19-member monetary bloc still raises a wave of anxiety for the ordinary Athenian.


Elderly placard-holder takes part in pro-government rallyThe Bank of Greece vocalised much of these fears this week,warning of near apocalypse if the country returns to the drachma.

But there are others who think the current phase of turmoil could be right kind of “shock therapy” for the country.

“I will lose all the money and probably my company, but maybe that’s what’s required,” says Koutsolioutsos, of Farmers Republic.

“We need something as extreme as the prospect of no wages or pensions for a month to shake ourselves out of what we have become.”

Rampant corruption, pervasive tax avoidance, and the vast shadow economy are all sources of complaint for fledgling businesses.

“We are productive, entrepreneurial people” says Gina Mamidakis, hotelier and founder of the LoveGreece foundation which aims to create a network of the country’s young entrepreneurs.

“Everywhere we travel in the world, Greeks are among the most successful immigrant communities, but that’s not the case in Greece itself.”

But Grexit is not simply a case of weighing up the financial costs and benefits for Greece’s 11 million people. It strikes at the existential heart of what it means to be a Greek.

“Our history has been dominated by the question of East or West,” says Makis Tsakpinoglou, a former publishing head who now sits on the board of LoveGreece.

“We are the founding civilisation of the Europe. There is no Europe without Greece.”

Byzantine bureaucracy

Evidence of political dysfunction is never far away in Athens.

The capital alone is made up of 325 local municipalities. At a meeting of the union of local authorities, president George Patoulis sits through more than six-hours of heated public discussion over the future of the city’s refuse collection system.

Despite promises of a final vote to be held on rubbish collection, matters are postponed to the following week.

Localism is at the heart of how Greeks conduct their politics. It is one of the reasons they remain comfortable with the idea of being part of an institutional structure where power is devolved through Brussels and Berlin.

But the Byzantine bureaucracy poses a challenge for the central government. Mr Patoulis is now spearheading the resistance against a decree forcing all local government bodies to transfer their excess cash reserves to the central bank as the government desperately scrambles for funds.

“It will only happen if it is the last drop of blood that can save us from a euro exit”, he says.

With only ten before Greece’s fate could be sealed, that moment seems to have come. European leaders will now gather for a summit on Monday to thrash out their differences with Tsipras.

Yet for all his defiance, Patoulis too embodies the anxiety that pervades every level of Greek society.

“We’re like passengers on a plane. We trust the pilot to know what he’s doing, but we still don’t know our final destination.”


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