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After night of rage: Greece awakes to bitter reality

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Paul Mason | 12:55 UK time, Sunday, 2 May 2010

George Papandreou's speech to the Greek cabinet was light on detail of the austerity package - that will be announced later - but heavy on a certain kind of rhetoric south European voters will have to get used to.

If you want a case study in catharsis, also in turning a crisis into an opportunity, it's worth a read. here are some exerpts:

"Ladies and Gentlemen, we know that these are hard sacrifices, but they are necessary. This is the only way that we will be able to finance the 300 billion Euros debt we have. If we do not finance this debt, Greece will go bankrupt..."

"I have ordered the Minister of Finance to speed up the procedure for drawing up the new electoral law so that the political system will be established on new sound basis. We must say in all sincerity to the citizens of Greece that we have trying times ahead. We are seeking a new meaning to our values however, such as quality, humanness, democracy, solidarity between us - we are opening up a new road...."

"We do not promise to have an easy or painless time over the next few years. I do however promise three basic things: first of all that we will do everything to protect the weakest in this crisis.

Secondly: that the feeling of justice will be consolidated since this has been lost and obviously there is anger. This is something we feel, we all understand. Something I understand. This is the rage of citizens today who have to pay for the sins of others. Justice, equality in the eyes of the law, the just distribution of burden and wealth are for us a daily battle and commitment.

Thirdly: I promise to fight alongside all of you and to make this crisis an opportunity for change. We must change, Greece must change, we must think and dream differently, and make Greece different. This is a new beginning which will make us proud of our country and of our work."


  • Comment number 1.

    In other words he could have said.

    '' we must follow Germany's excellent example to the rest of us on how to develop a nation and manage an economy, but we must endure many years of suffering to achieve that goal.''

    Maybe that is not what being a greek is being about, maybe they have opther ideas about the best way to lead ahappy life?

    After all Germans travel in droves over the greece for thier annual slice of happiness once or twice a year.

    What can Germany teach them exactly?

    We shall see.

  • Comment number 2.

    So far the economic turmoil has been ascribed to bankers and collateralised debt obligations. How much of the malaise is down to politicians going on a protracted spending spree with the public finances? Greece has been found out, and the UK is next...

  • Comment number 3.

    the usual blood, toil, tears and sweat speech?

  • Comment number 4.

    Why just south Europeans?

    Nothing is for nothing in this world and the sooner we get this point across to all and sundry the better.

  • Comment number 5.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 6.

    Interesting that €20bn euro of the package is earmarked for bailing out the Greek banking sector, plus, according to the FT website, the Greek government will be expanding its existing package of bank guarantees by another €40bn -- "Greece agrees bail-out with EU and IMF, FT". No wonder Greek bank shares did so well last week.
    I wonder how well this news is going to go down on the streets of Athens next Wednesday -- there will be a general strike here on May 5.

  • Comment number 7.

    Let's hope the Greeks don't lie on their backs to have their tummies tickled like the Latvians and the Irish. Reports in the Sunday Times suggest Cameron has a UK version in mind should he get an overall majority. How does slash and burn in the public sector help the private sector to prosper?

  • Comment number 8.


    the tories are ideological rather than strategic in their thinking. they are using the credit crunch as a pretext to indulge their market fundamentalist ideology of tax cuts. there have no nation building plan. In a return to the 'Dickensian model' of society they wish to see national services run by unelected unaccountable charities and church groups.

    why have they not mentioned that millionaire land owners get 4 billion a year merely for owning land? or why the uk is one of the few countries in the world without a land tax?

    is there something in their DNA that prevents them?

  • Comment number 9.


    'Warren Buffett backs Goldman Sachs over fraud allegations'

    The "Sage of Omaha" – speaking publicly for the first time since the Securities and Exchange Commission (SEC) filed civil fraud charges against the investment bank – stressed that he "loves" his $5bn (£3.27bn) stake in the investment bank and branded the Royal Bank of Scotland as "dumb" for losing $900m on the $1bn transaction under scrutiny from civil and criminal investigators.

    Now what's that saying...'the love of money is the root of all evil'.

    Some people will stoop to any level just to save a few bucks!

  • Comment number 10.

    If these measures dont stop the speculative attacks on the Euro, then the amount of the bailout will have to increase over the course of the week. What is strange is that the British bond markets are to open 1 am on Friday to give an automatic live verdict on the outcome of the election. Factor into this that the leader of the Christian SocialUnion of Germany said 'Greece should seriously consider leaving the Eurozone' and the information that the Eurocurrency has country based codes in the information on them that the public can read, then if these measures fail, the break-up of the Euro will occur. Sterling will be hit next...

  • Comment number 11.

    Thank you for keeping a close eye on Greece, Paul. While we're hearing a lot of rhetoric on the hustings, they're already facing down the challenges that could be facing us in a few months time.

    Papandreou must, of course, say the things that please his current paymasters, but he knows that strong words threaten the flimsy political contract that exists in his country. A country that has, to some extent, regarded taxes as "voluntary" is unlikely to jump at the prospect of higher rates. The size of the "black" economy can be expected to grow.

    The second problem faced is that the Greek populace has no hesitation in demonmstrating against its Government and the institutions - international banks in particular - that are seen as the real culprits.

    It could be a long hot summer on the Mediterranean.

  • Comment number 12.

    Comedian Frankie Boyle criticises BBC 'rebuke'

  • Comment number 13.


    It is going to be quite a day on Friday!

    As far as I know the eurozone governments will have to unanomously vote for the bail out package by Friday also or it can not go ahead.

    Is that right Paul?

    How likely is it to get through that even?

    Any analysis on that?

    Any governments likely not to vote for it?

    Maybe the subtext to all this is that in the background discussions in the corridors of power they have already decided, it is better to be seen to have tried and failed to keep Greece in the eurozone, than not to have tried at all.

    Thats democracy folks!!

  • Comment number 14.

    'If Greece is not bailed out then banks will lose money - principally French and German banks and hence it will be necessary to bail out banks once again. This may be more palatable to the domestic population but the economic effect is the same.

    It makes little difference anyway because next up are Portuguese, Spanish, Irish and Italians. Too big to fail will become too big to bail. Again we are all in the same tunnel, and the only escape from that tunnel is debt repudiation. Look at South America it shows the way out - the only way out.

    "Most people prefer to believe their leaders are just and fair even in the face of evidence to the contrary, because most people do not want to admit they do not have the courage to do anything about it. Most propaganda is not designed to fool the critical thinker, but only to give moral cowards an excuse not to think at all." - Michael Rivero'

  • Comment number 15.

    1.] In his 1997 budget, Brown abolished dividend tax credits on pension funds. Companies saw the writing on the wall and immediately ended their final salary pension schemes to new employees shortly after the 'Brown raid'. They also started to cut down on the number of people with long final salary pension service and worked towards ending a scheme which would no longer be viable.
    * The CBI opposed Browns Tax credit cuts. Even the treasury and No.10 opposed them. [But Brown made the cuts anyway.]

    2.] By abolishing the pensions tax credit, the yield for institutional funds across the entire market fell by 20 per cent. Few people outside the City understood the change and hardly any MPs protested. But Whitehall papers produced under the Freedom of Information act showed that Mr Brown was warned by his officials and by the Treasury that there would be dire consequences.
    They warned it would wipe £50bn off the value of funds, and that shares could drop by up to 20 per cent and public sector pensions would need topping up. [Brown chose to ignore this warning]
    * The value of pension funds have since lost around £5bn per year since the 1997 tax relief cuts. Pension funds holding the cash that almost everyone in the country had planned to use for our retirement have lost around £100 billion over the last 12 years.

    3.] The advice Brown was given by this Treasury Paper, in 1997 was as follows:

    'The changes in incentives are likely to lead to substantial changes in portfolios. Pension funds will find equity relatively less attractive, and will prefer other assets – particularly interest bearing securities and foreign equity – and may also be prompted to consider more direct property investment.'

    Those funds were then channelled into fuelling an unsustainable property bubble, BTL portfolios, which developed because of Labours complete lack of regulation of the Banks.This was followed by ever increasing toxic mortgage debt, and this was followed by the bank bailouts.

    This is just one example of Gordon Browns incompetent decision making which helped to create the cornerstone of the debt bubble.

    4.] In the ten years previous to Browns Raid on pensions, From 1987 to 1997 the Average House Price rose from £40k to £55k.
    A 33.3% rise over ten years.
    From 1997[post tax dividend cuts] to 2007, the Average House Price rose from £55k to £190k [Nationwide Building Society figures]
    A staggering 245% increase over the same period. [Ten years.]

    The UK debt bubble stopped inflating at the end of 2003.

    But then, Chancellor Brown removed housing costs from the inflation index (in December 2003, from RPI to CPI), despite Bank of England's opposition, to force the Bank to keep interest rates low. Too low.

    The UK should not be facing the debt we are facing, and The Labour Party are guilty of gross fiscal mismanagement and criminal negligence.

    Raise IR to protect the pound and bring housing back to being affordable once again.
    Why should a younger generation pay for your debt?
    Whilst keeping your house prices artificially inflated?
    We are in effect paying for your houses, whilst being unable to afford our own. That is called Indentured slavery.
    We have already been forced to waste tens of thousands in rent over the last nine to ten years.
    We are being forced into Debt Bondage.

    Our generation hold you responsible Mr Brown.

  • Comment number 16.

    You just need to get a grip on life ....and just appreciate the real qualities of life...

    Life can be cruel!

    Japan: Life in Tokyo

  • Comment number 17.


    The slow motion economic car crash continues.

    Is it better not to know about something you can not change? (#15)

    It will happen no matter what any of us says and no matter what we know, there is way too much momentum behind it for words or deeds to stop it.

    Sharing the burden here helps (it helps me anyway), and I guess the longer the process can be dragged out and the more people understand it the softer the blow will be and the quicker a new, more robust model can be built, but crash she will.

    I dont so much blame those whom have presided over this (like Mr brown) as feel a sense of pity for them.

    The best you can do as an individual is to try to spread the understanding as best you can, and be as prepared as you can be opna personal level.

    Prepare for the worst and hope for the best is never a bad strategy in such uncertain times.

  • Comment number 18.

    I would love to know what statist would have made of this song?

  • Comment number 19.

    We are in big trouble!

  • Comment number 20.

    I'm just a symptom of the moral decay thats eating away at the country

  • Comment number 21.

    #17 Jericoa

    I'm an engineer just like you! (chartered as well btw)

    When the likes of us start getting involved in politics...the rest had better start looking out!

    Things are getting serious.

  • Comment number 22.


    'America' thinks it can govern the world, even before it has civilised itself. The EU nuts think Greater Europe is viable, even though it cannot function without corruption and two seats of power. British leaders still have feudal power at home and comedy Nuke-Power at the Globopoly table.

    The impossible dreamers (Tony is typical) are overreaching themselves, in all directions. Greece is a tiny symptomatic pimple.

    Man started on this trend when he deforested the globe for industrial food production (aka farming). After that, it just got worse.


  • Comment number 23.


    I wish I could believe that, an engineering background is hopeless in terms of training to get anywhere in a modern western democracy.

    Our thought processes are necesarily trained to be unleveraged, our design processes have hold points where the solution is debated between professionals (design numerical or philosophical check)to make sure everything we do is as fit for purpose as possible and safe given the information we have at the time and the stated aim.

    If, during the process of technical debate, it becomes apparent that I have made a mistake in my calculation or assessment through the process of reasoned argument, I thank the person whom pointed it out, cherish the new insight, change the approach accordingly and move on happy in the knowledge that the design has been improved.

    Politics does not work like that, because of the hopelesly leveraged media, mistakes can never be admitted to, changes in direction can not be made, open, honest debate is amyth. A

    Anything that whiffs of a mistake or a change of direction will be pounced upon by the oppositions media as signs of 'weakness' or 'poor judgement' rather than being 'part of the process to achieve the best solution', assessments you made years ago in an entirely different context would be dragged up from the archive (relevent or not) and used as evidence of your poor judgement.

    We would be swamped by damaging bad press within months of taking office, made to look like idiots.

    The pre-requisite to becomming a successful politician is to pretend you are not human in the first instance, you are beyond human, you dont make mistakes, you have the best judgement, you never say anything that could later be used against you.

    The trouble is when you start to pretend you are not human in order to get up the career ladder, you end up believing it. Is it any surprise we have ended up with the crop of politicians we have in the media age? Gordon Brown must represent the pinacle of self delusion in politics '' I have abolished boom and bust''...I ''saved the world''.

    In any other profession these people would be sent on paid leave pending the results of psychological assessment, in politics they get to run the country.

    I am afraid Debt juggler I disagree with you on this occasion, politicians, thanks to the media, have absolutely nothing to fear from the likes of you and me.

  • Comment number 24.

    The Greek lower and middle classes get a brutal haircut, to save the German & French Banker bonuses..........

    Doesn't seem quite right to me.

    Perhaps if G-Pap had concentrated on recovering taxes further up the Greek food chain, he might have bought himself a bit more time to exit the Euro with grace and style.

  • Comment number 25.

    the working class in Greece going to bear the full brunt of any austerity measures`the IMF imposes, the same guys who gave us the cane in the seventies, what a pity the bankers in Greece will have, yet again, got off scotfree and maybe even got a bonus! The fall of the Euro, the decimation of the markets, Enron, Bear Sterns, are all symtomatic of the failure of capitalism, Marx predicted it two hundred years ago and here we are into the 21st century trying to revive a dying corpse......the games over, chaps

  • Comment number 26.

    #23: with non-corporate media, that is how things *would* operate, even in politics.

    regard how the NN blog has allowed people to discuss and shift their opinions.

    it is the centralised nature of politics and the media that has caused this lack of open-discussion and acceptance of making mistakes - and it is in the interests of those already in power to keep that situation.

    #paul: papa pap seems to mean it. I'm sure we all wish him, and the Greek people, all the best in their troubles. And perhaps, as you argued before, leaving the Euro wouldn't be the worst possible outcome for Greece anyway, as the terms under which it joined were so harmful to the Greek economy?

  • Comment number 27.


    I agree this blog space in particular provides unleveraged, insightful and informed debate by free thinkers (in general), but it does not represent the mainstream. If it did it would effectively end up being 'closed down' via dilution by an avalanche of corporate and political spammers. As soon as it got popular enough to be would be ruined.

    Since the clegg surge I can barely bring myself to read a 'news' paper anymore, the partisan vitriol in some of them would make Stalin blush such has been the panic reaction to achallenge to the status quo.

    How do those journalists sleep at night?

  • Comment number 28.

    UPDATE: who is that bloke who looks like Gordon at the London citizen's conference? Nye Bevan?!!! what a speech. he'll lose but by why oh why did he not speak like this for the past 10 years. amazing. I'll still vote Lib Dem tho. lol. maybe free of office (almost) he's found his true self.

  • Comment number 29.


    "If it did it would effectively end up being 'closed down' via dilution by an avalanche of corporate and political spammers. As soon as it got popular enough to be would be ruined."

    not any more, there are too many places for political argument on the net now. And there is also twittering. If it did get attacked by deliberate spammers, trolls and 'personal attacks' to destroy the conversations taking place, it would be obvious it was an intended, malicious attack. What is interesting then, is working out what the intended target opinions were, and why would the spammers be wanting to silence them.

    but i would expect the conversations to go on anyway. And hopefully most seasoned posters would recognise the personal attacks as just trying to stifle true debate.

    "How do those journalists sleep at night?"

    by toeing the Owners/Editors/Party lines, their mortgages will continue to be paid, and something of a pension plan maintained.

  • Comment number 30.

    The current crop of politicians wont be able to survive the popular backlash. They were schooled in the salons of universities such as the London School of Economics, marketing and advertising agencies if they actually were given a post by their contacts, or spent time in various homes their families own around the world. Argentina is key to the issue. Dollarisation was presented as a fait accompli. Much like the Euro. The Argentinian people faced with 25% unemployment fought it when the union leaders and opposition parties finished with their round of pre-agreed protests.In Greece we have had 4-5 general strikes and countless other sectional strikes which dont lead to any of the measures being rescinded will end up in the end provoking an uncontrolled mass explosion similar in intent to the Poll Tax way back in the last years of Thatcher. In March the head of the IMF announce there was no bailout plan, Papandreou has spend 6 months stating we need no money and now he states bankruptcy is on the cards. Indeed it is for the working man and woman not the banksters. That is why debt repudiation will become the only means of salvation for this type of situation. Only by returning to the Drachma is their some hope in economic salvation.

  • Comment number 31.


    You will have noticed he was close to 'dancing'. But be under no illusion, should he get back into power, the Machiavellian Hyde-Brown will emerge again to wriggle out of high-flown pledges and to invent invisible taxation and incomprehensible (widely unclaimed) hand-outs.

    Westminster will never yield integrity. You cannot make a perfumed rose out of a rotten rosette.

  • Comment number 32.

    some BIG money guy (the yank who said stirling was "finished") on Radio 5 today said bankruptcy would best policy for Greece, though he thought it wouldn't happen but the Euro is "finished". whether it is or not what would bankruptcy look like, both socially, monetary and fiscally? he said many US states and distracts over the years have declared bankruptcy. er, what happens?

  • Comment number 33.

    I am 22, male, un-employed; and I want to change the world...what should I do?

  • Comment number 34.


    I thought quite hard about it, this is the best I could come up with.

    Firstly, and one of the hardest things to achieve is to accept that you can not change the world you are part of it. You have to re-phrase your question and take the ego out of it. That way you will be more useful within the spirit (if not the word) of what your stated aim.

    Not unrelated to the above, if you want to be a contributing force for 'the good' it has to start with 'you' , you can not externalise it by hitching yourself to some cause or other. First you need to roll your sleeves up and get right down into the basement of your psyche and clear out all the junk so that you are entirely comfortable in your own skin.

    Once you have achieved the first two then you will realise that everything you do, big or small changes the world on a moment by moment basis, and you will have suceeded in your aim already.The rest will follow naturally, whether you have a big part to play or a small one you will have changed the world for the good.

    I hope this helps, it is no doubt not the answer you were hoping for but it is the best one I can give. Not that i can speak with any authority on the matter.

  • Comment number 35.

    #33 Jericoa - I could not have wished for anything better; you clearly pondered the philosophical context of my question and I thank you for the effort.

    #15 MindYourOwnBusiness - "Why should a younger generation pay?" It is our parents and grand parents who signed up to this massive debt cycle, from which we all have benefited to some extent; Gordon Brown is the servant of the people; we get the politicians we deserve; we are all complicit in the western worlds profligate and conspicuous consumption of worthless junk, and this is the price we now pay and it all comes down to the economic model of Capitalism we are being forced to practice.

    Indentured slavery; Debt Bondage; these are terms I cannot disagree with...but what is one to do? It seems to me to be a power play of the super rich of the western world, this whole financial meltdown, in order to gurantee or at least extend wealth and asset retention for the forseeable future...the super rich are consolidating their place in the higher echelons of our Capitalist societies like a new Aristocracy while the plebs pay the price! But I say again, what is one to do about it?

    #17. Jericoa - Is it better not to know about something you can not change? This is an absurd question! How do you know that you cannot change 'something' if indeed you do not even know what the 'something' is?

    It is only with education that one can make a judgement on anything and so as education is held as a hammer with which to smash the poorest amongst us then we will never get anywhere. is defeatist to say that nothing will change. There is no other option but to work for the changes you want and it is the fact that alot of people do not do this which has lad our society to sleep walk into the clutches of the educated phew who would want to benefit from our collective ignorance!

  • Comment number 36.


    Hey I am only Human:)

  • Comment number 37.

    Greek stock exchange drops 7% today and bank shares by 10%. The announcement of the measures hasn't stabilised the markets instead it is making them worse.

    Parallely stock markets dropped in Portugal and Spain and Italy ranging from 4 to 5.4%. Sterling appreciated in relation to the Euro. Therefore the speculative attacks against the Euro continue unabated. A 1997 South Asian debt default appears to be on the cards if the markets dont stabilise by Friday. Its now being stated that Spain is going to ask for a E280billion bailout.

    Army personnel marched in Athens against the cuts as well as an occupation of the Akropolis by militants of the KKE whilst strikes continue all week

    Payfreezes are supposed to last for 3 years, and VAT to increase to 23% amongst other measures announced.


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