ARRIVAL IN GREECE, EPICENTER OF THE (DEBT) EARTHQUAKE…
As I arrived in the airport in Athens, it struck me that I had now been on the road for five weeks, and had trekked my way clear across Europe, from the far west, to central, and then to the far east. Greece was to be my next to last stop (Istanbul the final), and as I made my way past news stalls boasting racks of newspapers and magazines from every corner of Europe, with mastheads and headlines blaring as colorfully as the European currencies of old before the days of the drabber Euro, I reflected for a moment over the places I had visited on this journey.
I began my tour in Budapest, once the capital of a grand Hungarian empire which lasted nearly a thousand years. Then it fell to the Ottomans, followed by the Habsburgs, then formed half of another empire with the Austrians, lost 70 percent of its territory and a third of its people in the treaty settling World War I, fell under Soviet domination, staged an unsuccessful revolt against that domination, and covertly opened its borders to Austria in 1989 and accelerated the Soviet dominators’ collapse.
Now it has settled into the wobbly life of a democratic but troubled social capitalist nation, slowly inching towards its new destiny at the geographic heart yet still at the economic periphery of a peaceful and prosperous newly formed union of European nations — nearly all of whom had fought horrific wars against each other not that long ago.
From there I traveled to France — a place that has been one of the world’s major powers for centuries and now is proudly trying to learn how to balance that rich history with its current possible futures. A place where there is evidence of human habitation going back hundreds of thousands of years. Vaguely familiar cave ancestors who, through a mysterious and unknown evolution, became the Gauls, the Celts, the Franks, the Romans, Charlemagne, Caesar, the Cathars, the Huguenots, the cardinals and Kings Louis, Henry and Charles, names that roll off the tongue like a schoolbook nursery rhyme.
The Renaissance, the Protestant Reformation, the Enlightenment, French revolution, the hard-fought battles for ideals and principles which it turns out you can eat as surely as you can devour baguettes and brie — and which quickly transmogrified into guillotines and Napoleon, the Thermidorian reaction, the swing back of the pendulum that is sharp-edged like the blade of the executioner’s ax that can take off your head if you don’t learn how to duck. That’s what has preoccupied everyday people for much of human history, learning how to duck, how to avoid the next capricious whim of the empire’s courtiers about to knock on your door. France’s tale, from beginning to end a major chapter of Western civilization, is a cautionary one, full of lessons that cannot be appealed to a higher court.
From France I had moved on to Belgium, the Netherlands, Sweden, Norway, back to France, then over to Germany, then Austria, then Italy. At every stop it was immediately apparent, in an almost visually surreal way, that each of these European nations has an emotionally-charged yet remarkable past, evidenced in the bricks and mortar of the many houses of history that still remain, the castles and churches, the towers and parliaments, the villages and ancient roads, still casting the same shadows over passersby as they did centuries ago.
This is a past that stretches back so far into the human memory that it has become part of our DNA (DNA = Descendants ‘N Ancestors). The great historian Arnold Toynbee once wrote, “Countries have characters that are as distinctive as those of human beings,” and that is surely true, it explains why I see in my dreams nations that appear as immense individuals, as Olympian demi-gods that stalk the land lording over all the little people pulsating like the cells of these giant beings, with the tragedies , wars and crimes of passion akin to our collective domestic violence, the victories and treaties akin to our shared celebrations, the royal weddings that are our own matrimony to each other, the harvests and cornucopias of bounty our dinner table of plenty, the famines and droughts our depressions that rip apart the ties that bind, each national episode burned into “We, the Cells” and stored inside our collective carapace.
To the extent that those of us of European stock all have psychic sinews that stretch backward into this grand and tragic past, we are all victims suffering from post-traumatic stress. It’s not only the lines of the map that have changed, but the lines in people’s minds. And we are left, we little people, to cope with it all as best we can.
So after leaving Rome, after taking leave of the skeletal architecture of that once powerful empire poking out of seven hills, and the imperious, pious grandiloquence of Catholic basilicas clothed in marble stolen from that empire’s ruins, I finally touched down in Greece, that most ancient of western lands, the cradle of what is known as “western civilization,” located far to the eastern skirt of the west.
Unlike the other countries I have visited where “the fear of the crisis has turned out to be worse than the crisis itself” (as one commentator told me), in Greece the impact of the economic crisis has hit like a small tsunami. My colleagues in Athens talked about declines in service, in the quality of health care and other dents in the Greek system that they had been experiencing.
Large and militant protests had rattled the nerves of just about everyone. The government of Prime Minister George Papandreou had ordered sizable budget cuts and the layoffs of tens of thousands of public employees. The Greeks are in a complaining mood, for good reason, and so they bitched pettily that PM Papandreou, who hails from one of the two longtime ruling families that rotate in power and who had studied abroad most of his life (including in the U.S.), spoke better English than he did Greek.
This is seen as an apparent indictment of sorts, even though his approval ratings remain remarkably high. Most Greeks acknowledge that some kind of change is necessary, so ambivalence has become the bitter brew that they all drink around the cafes and tavernas.
On the other hand, this is Greece we are talking about. The place still has gorgeous weather, stunning landscape and health care for all, spotty as it is (compare it to California, where a recent report found that 25% of Californians don’t have any health care, and where the unemployment rate is higher than Greece’s). One of the qualities holding Greece back from enjoying the benefits of a more modern economy is its reliance on an informal economy of family and social networks which too often translates into nepotism, back room deals and tax dodging. But during an economic crisis like this, those networks become valuable means of support so that people don’t fall so far through the cracks.
It’s easy to forget that Greece is a country that was plagued throughout the 20th century by bitter schisms between monarchists, democrats and communists, with dictators and elected governments rotating in complicated power alignments right up to the 1970s when the last military dictatorship withdrew and the monarchy was abolished.
So while Greece is the ancient birthplace of demos kratia, its modern democratic incarnation is surprisingly young. Not paying taxes to the corrupt honchos who ran things for so long and relying instead on an informal sector of family and social networks became the fiber holding it all together, a well-founded Greek tradition, even celebrated nostalgically in films like Zorba the Greek.
During the crisis, those networks can act as a safety net; longer term, they will prevent the modernization of Greece because in a modern economy designed to provide for a mass society you have to be able to count things: revenues, expenditures, imports, exports, surpluses and deficits, these things have to be tracked as accurately as possible. But if everything is being done hush-hush, on the sly, in backrooms, without receipts or records, stored in cookie jars, under mattresses, in brassieres and petticoats, with a bit of payola in the right palms for looking the other way (“there’s your ‘tax’”), you can’t count anything. You can’t be sure of how much your government has to spend because you can’t be sure how much revenues it has taken in. So you just make up figures and hide that too, deficits become surpluses with a few whisks of the computer mouse.
That got Greece into a heckuva lot of trouble last year when it was discovered that its budget deficit was much larger than it had disclosed, and suddenly the bond markets got spooked and turned and attacked.
But it’s not only that the previous government was using the services of Goldman Sachs and others to hide its debt, but that in Greece there is a long-standing tradition of doing everything with a wink and a nod. And that “system” pervades at every level of society, right down to the neighborhood and household levels. In that way it shares much with the corrupt housing mortgage system that came to pervade America, from Main Street to Wall Street, from your local bank handing out mortgages people couldn’t afford to the large investment banks taking those mortgages and bundling them into derivates and credit default swaps and reselling them again and again until they became seeded like “financial weapons of mass destruction” (as Warren Buffet called them) throughout the global financial system.
In both Greece and America the dysfunctional systems provided economic stimulus for a time, with nearly everyone sucking from the teat — until the house of cards came crashing down. Yes, Greece and America have more in common than Americans want to believe, and I don’t just mean that both have large budget deficits. It’s actually far worse: both Greece and the U.S. have development models that no longer work. Yes, in many ways America is just a bigger Greece.
But that needs to change if Greece is going to have any chance of not only solving its current debt dilemmas but also of developing into a modern economy. I met with many Greek officials, including journalists, a deputy minister of the Papandreou government, and finally I interviewed Prime Minister Papandreou himself.
I consistently emphasized this message to them, that “It’s important in a modern society that you’re able to count things;” I gave a speech at the Greek Foreign Ministry (which is like their Secretary of State) and articulated this viewpoint there as well (see an article from the Athens press about my FM talk, linked here, but it’s in Greek so you will need to have your Google translator turned on).
I think they get it. My interview with Papandreou was extremely interesting. He has a vision not only for the immediate crisis but for a new Greece (more on my interview with PM Papandreou in a future post). Yet the old Greece has deep roots, like weeds and crabgrass, and it is not going to be that easy to dig them up.
New America Foundation
Republished with permission from the Washington Monthly.