Moisis Litsis, journalist at the Greek daily newspaper, Eleftherotypia: “Greece is a laboratory for the policy of austerity”

20 February 2012 by Moisis Litsis , Fátima Martín

Greece experienced on Tuesday, Feb. 6 another day-long general strike in the midst of negotiations of the government with the creditors and with the EU over the next bailout. Moisis Litsis, economic analyst of the Greek daily newspaper, “Eleftherotypia”, analyzes the Greek and European situation in this interview.

Diagonal: Could you evaluate the deterioration of Greek people´s standard of living since the bail out and the intervention of the Troika Troika Troika: IMF, European Commission and European Central Bank, which together impose austerity measures through the conditions tied to loans to countries in difficulty.

, made up of the European Central Bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

, the European Commission and the International Monetary Fund IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

Moisis Litsis: We live in a situation that I had never seen before even though I’m in my 50’s and I’m from a poor family that managed to live through many difficult years. First of all, hope has disappeared, on both the social and the private level, as it had in the past on similar complicated situations. The current crisis affects the so-called “middle class” people who took for granted the prosperity of the past few years and especially people my age for whom it is difficult to start from the beginning, they are not young enough to be optimistic, they have families etc.

Many people like me are living from past savings (if they have any), is very rare to find two people working in the same family (only if the one is public employee), more and more people go to common meals—the traditional Greek family is still a valuable “social net”. We must pay more and more in taxes for past incomes-many people simply refuse to pay, not for ideological reasons but simply because they don’t have money.

The official unemployment is 18%. And there are as I said before many workers like those of Eleftherotypia who are not officially unemployed but they don’t get any pay for their work. One of the flourishing businesses nowadays in Greece is the pawnshops that sell and buy gold. We see a lot of advertisements of shops, outside the traditional district of centre of Athens, about shops buying gold.

D.: Why is Greece different? I mean, why has Greece been the first one? Greek activist Sonia Mitralia says that Troika was using Greece as a lab to see how far they could go. What do you think?

M.L.: Ι think she is right. Even our former Prime Minister Giorgos Papandreou once said for a different reason that we are a “world lab”. As well you know, Greece has a very small proportion of the Eurozone economy (a mere 2% of GDP GDP
Gross Domestic Product
Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another.
, in comparison to 11% for example of Spain) and far less of the world economy. So why is there so much noise about the Greek crisis in the last two years, saying that it threatens to destabilize the whole world economy?

Greece was the first example of what everyone nowadays acknowledges: the world debt crisis, with the focus in the Eurozone as a whole. If Greece failed, there was a fear of a domino of defaults in other European countries and maybe the end of the Eurozone process. That’s way they tried to solve the Greek problem, of course without any success. Now there is a common discussion about how the debt crisis threatens to dismantle the whole Eurozone, of course not because of Greece, but because the crisis affects bigger economies, like Spain, Italy and France.

With the harsh austerity, the threat of an immediate default and exit from the euro, the troika first tried to persuade the Greeks that there is no other solution and second to terrorize other peoples, that if they don’t follow the Greek road, they will quickly find themselves in a similar situation.

Later they tried to how far the people would go in their reaction. Despite the continuous strikes, demonstrations, criticisms and polemics, no social explosion happened in Greece, so the rulers of Eurozone may think that they control the playing field, managing to suppress successfully any kind of discontent in other countries. I think that Greece is today the example of what shouldn’t happen in other European countries: To believe that there is no other solution to the debt crisis outside of the troika’s policies that impoverished Greek people.

“If Greece represents only 2% of the European GNP Gross National Product
The GNP represents the wealth produced by a nation, as opposed to a given territory. It includes the revenue of citizens of the nation living abroad.
, why has there been so much noise about the Greek crisis and its threat to the world economy during the last two years?”

D.: And what about the Greek people? Are they fighting back? Is Greek society united in the struggles? Is there a real counterweight? What is the role of ’aganaktismeni’? (the Greek indignant ones)

M.L.: We had a ton of strikes. Some of them massive, especially in the beginning of the crisis. But Greeks didn’t see any real change. A big moment was last summer when the “aganaktismeni” movement started with thousands of Greeks surrounding parliament, hoping that the majority of PASOK (socialist party) in the end would not vote in the new measures that the troika imposed after the July agreement for a new loan. The only achievement was the replacement of the socialist Prime Minister Giorgos Papandreou with the “technocrat” former central banker Lukas Papademos with the support of the opposition parties of the rightwing New Democracy and the far right LAOS.

I think Greek people was exhausted from not seeing a real change, they are still hesitant to follow the traditional unionists, even the traditional left parties, despite the good results they reached in the latest polls. There are many new initiatives on a local level, but not a general massive movement with a central demand. But the struggle continues.

I think there is a need for a total rejection of current policies and the debt, even to question the Greek involvement in euro. After all, despite the differences about this question in the policies of the different left forces, there is high probability that Greece will be forced to leave the euro, without a real movement ready to counteract the harsh consequences of a move like this. If this happens, there will be tremendous political and social changes.

D.: Why hasn’t Greece declared, up to now, an indefinite general strike?

M.L.: For many years I remember the far left to try to promote indefinite general strike without any success. The last two years we had many general strikes, even more than we did in the first years after the fall of junta in 1974, which was a period characterized by a great radicalization and a great youth movement.

People lost also a lot of money from the strikes, mainly those in the public sector, so in these difficult times they are hesitant to go on an indefinite strike, something that the traditional trade union forces don’t really want and are unable to promote.

D.: What is the threat from the extreme right in Greece?

M.L.: It could be said that we have two kinds of far right in Greece. One with a connection to the anticommunism of the traditional rightwing — anti-Semitic, nationalistic, xenophobic and racist — and one more extreme, neo-Nazi. The first is being expressed by the LAOS party (its founder was member of the rightwing New Democracy) and the second by the neo-Nazi organization “Chrysi Avgi”. Both are on rise. LAOS is member of the new government of Lucas Papademos (it could be that because of that its popularity of the last few years is declining a little) and Chrysi Avgi in some areas got better results than the far left.

For many years, because of the junta, the far right was marginal. It was based mainly in anticommunism, which seemed outdated after the fall of the eastern bloc and the weakening of the traditional left that had influenced Greek politics despite its defeat of the civil war after 1945. In the last few years, together with the traditional anti-Semitism-LAOS tried to exploit the Palestinian cause, which until then had been an issue for the left, to promote a new kind of anti-Semitism masked as harsh criticism of Israeli policies. This despite the well known connections between European extreme right and Israeli establishment-far right. It uses islamophobia and the wave of undocumented immigrants, together with the exploitation of national feeling(problems with Turkey, Former Democracy of Macedonia) in order to promote its agenda. Its support for the present government caused some problems to its constituents who were, from a narrow nationalist point of view, against the troika policies in the beginning.

D.: What is your explanation of the Troika’s offensive, not only with regard to Greece? Do you think its goal is to attack the working class all around Europe?

M.L.: Of course. Look. In the last 20 years, in the “golden age” of neo-liberalism, we saw a continuous tendency in Europe to dismantle the “welfare state” and diminish the traditional power of the trade unions (especially in the countries of Northern Europe), in the name of achieving high rates of growth of the GDP.

Involved in this process was a big struggle inside the EU and in many governments, which, because of the pressure of the unions and public opinion, adopted the neoliberal reforms at a “slow pace”, sometimes retreating under the pressure of the people. Now with the debt crisis going on, which is a result of the “bubble” of the euro, the governments have been forced to quickly employ reforms, in order to have much cheaper labor costs, without rights and social security for workers. Many people, afraid of much harsher consequences like those that we are already witnessing in Greece, hope that the measures that governments take could avoid default and hope that the deterioration of living standard can stop.

It’s time for the working class to rise up and find new ways to confront this brutal policy that — as we see in the case of Greece, never stops.

D.: What are the links between the European powers and USA in this ’euro debt crisis’? What is the role of Germany? How real is the ´euro debt crisis´?
M.L.: Many people in Europe believe that the U.S. policy is friendlier to economic development because the USA can print dollars and promote growth. This is not really true, because despite all the billions of dollars that the Federal Reserve FED
Federal Reserve
Officially, Federal Reserve System, is the United States’ central bank created in 1913 by the ’Federal Reserve Act’, also called the ’Owen-Glass Act’, after a series of banking crises, particularly the ’Bank Panic’ of 1907.

FED – decentralized central bank :
printed in the last few years, the social situation in USA is similar to that of Europe and in some ways even worse.

The euro debt crises are real and are the result of the model of consumerism of modern capitalism. In the past (for example in 1970s) the public deficits were result of the traditional Keynesian policies, to finance the social state etc. Now we have seen an explosion of public and private debt in almost every Western country, because banks pressed both individual people and countries to take loans to finance their prosperity (buying houses, cars, services etc.), with cheap rates — and now the banks demand their money back, knowing that no society can afford to pay all these sums of private and public debt without real growth.

They accuse the people of living beyond their means, but in the past it was through borrowing that we had the high rates of growth in Greece, Spain and Ireland.

Germany and its banks played a big role in this. Germany is a relatively “conservative” consumer society and through credit was able to finance countries like Greece, which could then buy weapons or build massive public works for the Olympic Games, to the profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. of big Greek and foreign companies.

The mass circulation German press, like Bild, attacked the Greek people, accusing them of being “lazy” and of swallowing up the Germans’ money, although the German contribution to bailout packages, has also been done at high rates of interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. , much higher than the rates at which the ECB ECB
European Central Bank
The European Central Bank is a European institution based in Frankfurt, founded in 1998, to which the countries of the Eurozone have transferred their monetary powers. Its official role is to ensure price stability by combating inflation within that Zone. Its three decision-making organs (the Executive Board, the Governing Council and the General Council) are composed of governors of the central banks of the member states and/or recognized specialists. According to its statutes, it is politically ‘independent’ but it is directly influenced by the world of finance.
loans money to other banks.

Germany has transformed euro to a “German currency”, and wants to impose the German model on all the European countries, despite their traditions, mentalities and economic disparities that are result of gap between North and South; Germany is reluctant to pay the price even though it is the country that benefited most from the introduction of the euro.

It reminds one of the former Soviet Union, which wanted to impose one kind of “socialism” on the entire Eastern bloc, despite their history, traditions and mentality.

D.: In the Spanish state, When the Popular Party (PP) took over the government in November 2011, it discovered an even greater deficit: from 6% to 8%. In Greece, you have discovered the scandal of inflated statistics to justify cuts and austerity. What would you tell the Spanish people about this?

M.L.: Don’t trust the official statistics and try to find the truth — an audit movement could contribute in this. Don’t trust even Eurostat; the Brussels bureaucrats have equal responsibility for the “false” statistics in Eurozone countries. Nowadays in Greece we are witnessing a second part of quarrel between PASOK and New Democracy Party, which was accused of not telling the truth about the deficit when it was in the government in 2009 and that now accuses PASOK of inflating statistics to persuade the public to adopt the harsh measures proposed by the troika) 

D.: Finally, would you like to transmit something to Spanish people? A lesson they can learn from Greece?

M.L.: There is on lesson from Greece: Don’t believe that there is no alternative solution. Look at what happened to Greek people, who at the beginning thought that the first austerity measures would be enough to protect them from default. Now Greece has been unofficially defaulted, thousands of people in the private sector have lost their jobs — in the beginning they told us that the problem was the “saturated” public sector”— people are lining up to eat in the low-price cafeterias. We should rise up to reject these policies before it is too late. Organize and show solidarity with the Greek people because it is a common struggle. We must fight on a European level, something of course that is very difficult.

Moisis Litsis

is a journalist in Greece, former trade unionist and member of the Greek Committee against debt. (
He worked for many years in the daily newspaper Elefterotypia, where he was member of the workers’ committee, now works for the financial daily Naftemporiki.
He participated also in the Truth Committee about Greek Debt of the Greek Parliament.

Fátima Martín

est journaliste, membre du CADTM en Espagne. Elle est l’auteure, avec Jérôme Duval, du livre Construcción europea al servicio de los mercados financieros, Icaria editorial 2016. Elle développe le journal en ligne

Other articles in English by Fátima Martín (9)



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