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Suffocating Austerity: The West’s Folly in Greece Repeats Old Patterns

The troika’s attack on Greek sovereignty recalls the devastation of the Fourth Crusade, but there is an honorable way to resolve Greece’s debt crisis.

In 2012, the Greeks cannot pay back 245 billion euros they borrowed from European and American banks. But instead of extending a helping hand to member country Greece, the EU, and Germany in particular, act like taskmasters. The EU even invited the International Monetary Fund (IMF) to jointly deal with Greece. The IMF – whatever its putative mandate and formal structure – is an American institution designed to wreck economies that are interfering with capitalism’s business as usual – especially American business. Strictly speaking, the EU and IMF have been on a collision path with Greece in order to extract every penny the banks claim they lent that country.

Moneylenders Undermining Greek Sovereignty

The EU and IMF “convinced” Greek politicians (who were presented with zero alternatives) to sign on to demands tantamount to giving up Greek sovereignty. Under the Memorandum of May 2010, the Greek government abandoned all rights under international and Greek law to protect Greece from the claims of moneylenders. In addition, under the Memorandum, all Greek public property – in fact, all of Greece – could become the property of the moneylenders.

In May 2012, Mikis Theodorakis, the internationally known music composer, described the Memorandum as treason, and those who signed it – members of the New Democracy and Pasok parties – as traitors and criminals. Putting the banks’ earnings above the well-being and sovereignty of the Greek people recalls 1840s England, when the country sold Irish corn within its own borders while the Irish were dying from famine.

Theodorakis is right, however. The agreement of May 2010 between the troika – the European Commission, the European Central Bank (ECB) and the IMF – and Greece was an act of war against the dignity, independence and well-being of the Greek people. But instead of describing things by their real names, we invent euphemisms like “structural reforms” or “austerity.”

Not only did the Greek politicians impose an austerity program which reduced the living standards of the Greek people significantly, increasing suicides by 40 percent and unemployment by more than 20 percent, but they agreed to such barbarous terms for the foreseeable future, all but guaranteeing the impoverishment, colonization and eventual slavery of Greece.

In a May 7, 2012, interview with Amy Goodman of “Democracy NOW!” Yanis Varoufakis, professor of economic theory at the University of Athens, described Greece as being in a “deep coma” and as a “failed state” suffering from an American-style Great Depression.

Greece is becoming very poor, but it is not a failed state. The Greek political class failed, but not the Greek people. The economic plight of Greece is a result of corruption and excessive foreign influence. Greek politicians and businesspeople linked to foreign governments and corporations are doing well. In fact, some Greeks trace their money and power to the Nazi occupiers of Greece in the early 1940s. They and others of the ruling class slowly did away with Greek’s few industries manufacturing cars, trucks, motorcycles, ships and other goods. They willfully de-industrialized Greece, making the country a dumping ground for German and other foreign products. They also allowed the EU’s bribes/subsidies to diminish and demoralize the rural population by converting Greece from a country self-reliant in food production to one that now imports an unacceptably high percentage of its food.

The Bread of Demeter

I still remember the round loaves of wheat bread my mother and aunt made. The shape, the aroma, the taste of that peasant bread was the goddess of agriculture, Demeter, herself. Those same loaves of dark brown bread were at the center of the entire Greek agrarian civilization of Hesiodos (late eighth century BCE) and Xenophon (late fifth and fourth centuries BCE). Now the Greeks eat French-style, white, squishy factory bread. That is one of my complaints whenever I visit Greece, which is almost every year. I get angry with my sisters, who also eat that tasteless bread.

My village, Valsamata, in the Ionian island of Kephalonia, is no longer the village of my youth. There are no longer any donkeys, horses or mules in the village. The few families raising wine grapes and olive oil own small trucks. But no one cultivates wheat, barley or lentils – the staples of my father’s farming. There are also fewer peasants herding flocks of sheep and goats. My younger sister’s youngest son, Dionysios, had a small store selling cheese he used to make himself from the white milk of sheep. But he abandoned that agrarian tradition for the lure of a job at the local airport. It breaks my heart seeing the old people of Valsamata buying their loaves of bread from a daily truck making the rounds.

However, my real complaint is the desolate villages, left to old people waiting to die. I was stunned going through Machairas, a beautiful village in Central Greece. When I asked the village teacher about her pupils, she blushed and admitted in a low voice that her four elementary school pupils were Albanian. Not a single Greek pupil attended the elementary school of Machairas because the young people of Machairas have abandoned the village. And with the exception of a few peasants cultivating fruits and vegetables, the “farmers” of Machairas produced nothing because the EU subsidized them to stop growing tobacco. The farmers are not certain they will start growing food once the subsidies come to an end in 2013.

Alexander Poularikas, a retired professor from the University of Alabama, recounted the story of his village to me. He said his village, Desylla, is in the “most fertile place in Greece,” northern Messinia, Peloponnesos. He remembers Desylla had a population of 1,300 in the early 1950s, but said that has dropped to only 265 in 2012. Most of the remaining villagers live off their modest government pensions. Just four families cultivate the land, but they raise grass as a cash crop instead of food. Desylla also produces olive oil, which sells for 3.5 euros per kilo, an excellent price – but this oil is being exported to Italy for a cheaper price.

Add the Turkish factor to the agrarian drama, which is literally the Achilles’ heel of the country, and the full nature of the current crisis becomes clear. Despite the fact that both countries are members of the North Atlantic Treaty Organization (NATO), Turkey remains an enemy of Greece. NATO is an international military “alliance” which effectively exists to allow America to to control Europe and other regions. The United States pretends its stance toward both Greece and Turkey is neutral, but it blessed Turkey’s invasion and occupation of 40 percent of the Greek island of Cyprus in 1974. This traumatic experience taught Greece not to trust NATO or the United States. Unlike a country like Israel, Greece does not have a cozy relationship with a giant empire that keeps it supplied with military aid, nor does it have the support of the United States to face Turkey, a much larger country with a huge standing army. So Greece spends large sums of money for armaments from the United States and the EU, hoping to make Turkey think twice before it launches an attack.

The Engineered Crisis

According to Carol P. Christ, an American woman living in Greece as a Greek citizen and an environmentalist, “The Greek crisis was in large part engineered by international financial and military interests that viewed Greece as a market for their products and weapons.” No doubt, some of the Greek debt was incurred via military spending, most of it going to Germany, France and the United States, from whom Greece buys its submarines, war planes and tanks. Germany reveals great hypocrisy in insisting on a diet of austerity for Greece and simultaneously requiring Greek payments to German banks; it was German banks that hooked Greece on easy loans for the purchase of German weapons. Now the so-called bailout of Greece consists of billions of euros moving from the troika to German, French and American banks. Very little of that money stays in Greece.

The Greeks, of course, have been resisting this blatant foreign interference and its domestic form of austerity. They protest, strike and discuss their conditions endlessly, trying to make sense of irrational policies hurting them as though they were once again under German occupation. In the elections of May 6, 2012, they punished the two major parties, the conservative New Democracy Party and the so-called “socialist” Pasok, for signing the humiliating Memorandum with the troika. Support for New Democracy declined from 33 percent in 2009 to about 19 percent in the May 6, 2012, election. Pasok’s support went from 44 percent to 13 percent in the last two years. The election boosted the anti-memorandum parties, Syriza and Independents.

However, the tension of losing and gaining power did not go well with the parties. Greece is on the edge of a precipice, and the parties share responsibility for the danger the nation faces. They refused to compromise and collaborate, thus relying on the next election to break the impasse. Syriza and the Independents want to renounce the Memorandum of the troika, even if that brings Greece to bankruptcy. The formerly powerful parties, New Democracy and Pasok, want to maintain the austerity regime largely imposed by Germany.

These developments are clearly unsettling. To an outside observer, they appear strictly financial, as a problem of borrowers who are unable to pay back their loans. But behind the troika’s threats to Greece to keep paying her creditors, something deeper is going on. You see, little Greece is not a typical country going through the convulsions of troika-imposed “structural reforms.”

The Greek Achievement

Greece is a cultural superpower without which Europe would still be in the dark ages. Ancient Greek science and technology made the modern world. Aristotle, a fourth century BCE natural philosopher, invented zoology and defined science. The Europeans founded their first universities in the 14th century to study Aristotle. Archimedes, a Greek mathematical and engineering genius of the third century BCE, created the foundations for the science of Galileo and Isaac Newton. Archimedes was also the grandfather of the Antikythera mechanism, the world’s first computer.

In 1974, Derek de Solla Price, a British physicist and historian of science, concluded the Antikythera mechanism was indeed a form of advanced technology whose gears became the gears that made the technological and industrial revolutions possible. In 2005, a team of international scientists confirmed Price’s findings. The Europeans, therefore, know Aristotle and Archimedes – and the Greek achievement. In fact, they know the Renaissance was a consequence largely of the cultural legacy of the Greeks.

Jacob Burckhardt, the famous Swiss cultural historian, said in 1872 that the Europeans see with the eyes of the Greeks, and that to abandon them would be to accept their decline. Another European scholar from England, W.R. Inge, wrote in 1921 that there was no way the Europeans could do without the Greeks. “Without what we call our debt to Greece,” he says: “we should have neither our religion nor our philosophy nor our science nor our literature nor our education nor our politics. We should be mere barbarians. Our civilization is a tree which has its roots in Greece … [our civilization] is a river … but its head waters are Greek.” Finally, an American scholar, Harold Bloom, suggested in the mid-1980s that people of the West, “have no ways of thinking that are not Greek.”

But money trumps history, knowledge and culture every time. The banks that lent money to Greece engineered the Greek financial crisis to plunder Greece. Starting in the 1970s, they hooked Greece on easy money, knowing full well that Greece would be unable to pay it back, thus giving them the rights of the legal occupier. The identity of debtor Greece eclipsed the Greek achievement. The results of such amnesia are tragic. The Europeans – that is, the EU and the ECB – and the Americans – that is, the IMF – have broken with their Greek roots and abandoned the Renaissance and Western civilization. The potential consequences are severe enough that, in my estimation, the so-called West risks plunging into another Dark Age.

The illiterate bankers want their pound of flesh, even if that means killing their mother, Greece. Equally shocking to me is the torrent of media disinformation and virulence against Greece. I am also astonished with the silence of the universities. A notable exception to this indifference was a petition to the leaders of the EU by 22 internationally renowned scientists. They urged the EU to fund science and technology in Greece and sponsor cooperation “between major European science and technology centers and existing Greek clusters of excellence.” This petition was published in a May 25, 2012, letter to Science.

Even under the current suffocating austerity, Greek scientists work hard. In 2010, for example, there were 1.3 publications in Greece for every 1,000 Greeks. This productivity equaled that of France and Spain and was just behind that of America and Germany.

Despite such an achievement, the Greeks need our support. Where are the voices of professors of Greek and Latin, history, philosophy, theater, literature and art? Why aren’t they denouncing what amounts to another German invasion of Greece? Are we to assume they agree with the sale, real or imagined, of the Parthenon to Germany, or with the enforced poverty of the Greeks?

Chaos in Greece: Fear of Another Crusade?

The Greeks themselves are falling apart. Some are very angry with their political class. Panos Kammenos, leader of the Independents, accused Loukas Papademos, the choice of troika’s choice for a technocratic prime minister up to the May 6, 2012, election, of being a “broker” for the foreign banks. Kammenos refused to join New Democracy or Pasok to form a coalition government because those parties sold Greece to the troika. In addition, he demanded transparency and truth in the Greek government’s policies. Syriza also campaigned to stop taking orders from the troika, thus effectively ending the repayment of the Greek national debt. The Greeks rewarded Syriza with almost 17 percent of their votes, turning it into the second-largest party overnight.

The next Greek election on June 17, 2012, gave first place to New Democracy, with 30 percent of the vote; Syriza came second with 27 percent of the vote; and Pasok third with 12 percent of the vote. New Democracy formed a government with a couple of pro-Memorandum parties, so Greece continues with her enforced austerity for the benefit of the banks and Germany. But with Syriza raising its popularity from 17 percent in the May 6 election to 27 percent in the June 17 election, governing by the pro-Memorandum government will not be easy or without consequences. In fact, New Democracy already promised to renegotiate the Memorandum. Thus EU-Greece relations promise to be difficult and unpredictable. In the end, the EU could change the EU laws and expel Greece from the euro zone, forcing Greece to return to its own currency, the drachma. This kind of scenario, experts say, will be very painful. But Greece has learned to deal with pain.

During World War II, Germany all but annihilated Greece, executing hundreds of thousands of Greeks, starving others and smashing the country’s harbors, railroads, bridges, factories, roads and public buildings. Before Germany, the Turks extracted their ton of flesh from the Greeks, cannibalizing Greece for 400 years. The Turks also murdered 1 million Greeks in the early 20th century. The Turks employed genocide against the Greeks, Armenians and other minorities in their collapsing empire. Before the Turks, the Christians and Romans, but especially the Christians, made Greece a bloody palimpsest, scratching out Greek culture and writing Christian hymns and dogmas in its place.

Modern Greeks come out of this palimpsest. So the troika, to them, is more than banks and non-Greek-speaking barbarians. It is an image of horror stumped on the Greek soul. Greek history is full of troikas forcing Greeks to do this or that, even to abandon their identity.

The most vivid and dreadful experience, still alive in the Greek mind, is that of 1204, supposedly the fourth crusade of Western Europeans against the Muslims occupying Jerusalem. Venetian, French and German crusaders conquered Constantinople, the capital of the Greek empire, and dismembered Greece. The basic reason for that violence, then, as now, was debt. Venice played the role of the troika. A Greek pretender to the imperial throne in Constantinople borrowed excessively from Venice. And once crusading armies put the pretender on the throne, his government could not pay the debt. The Venetians used the debt crisis to get even with the Greeks.

The Venetian, French and German invaders acted like barbarians. They burned the libraries of Constantinople stocked with ancient texts. They melted ancient Greek statues and other works of art and technology for gold, silver and bronze to collect on the the Greeks’ debt.

According to Steven Runciman, a distinguished British scholar and author of “A History of the Crusades”: “There was never a greater crime against humanity than the Fourth Crusade. Not only did it cause the destruction or dispersal of all the treasures of the past that Byzantium [Medieval Greece] had devotedly stored, and the mortal wounding of a civilization that was still active and great; but it was also an act of gigantic folly.”

After 50 years, the Greeks threw the crusaders out of Constantinople, but the damage the Westerners had done to Greece was irreparable. It made Greece vulnerable to the Turks; that was the gigantic folly of the West. And when the Turks attacked in 1453, the Europeans did not interfere.

Shredding the Humiliating Memorandum

As the current debt tragedy of 2012 continues, the Greeks remember 1204. The troika ought to remember 1204, too. The Turks are watching. Once again, the Christian West is on another gigantic folly: humiliating and undermining Greece.

In practical terms, no one will benefit from throwing the Greeks out of the euro zone. Even the banks will lose. The crisis, instead, is an opportunity for both the troika and Greece to reinvent themselves and form a better union, after sending the IMF back to the United States where it belongs. Greece and the EU must find an honorable exit from the colonizing and enslaving memorandum. It’s a matter of life and death that Greece recapture her sovereignty by shredding that memorandum. That is exactly what Syriza wants to do, too.

George Kasimatis, a constitutional law professor in Athens, says the Greeks must denounce the Memorandum and declare a moratorium on payments until Greece and the EU renegotiate an agreement that is within international and Greek law. This means the EU ought to join Greece in nullifying that abhorrent document. On her part, Greece will have to abandon crony capitalism and a huge state bureaucracy. The new government must punish the politicians who borrowed excessively and squandered money for personal advantage or the benefit of their parties.

Costas Lapavitsas, Greek professor of economics at the University of London, would go further. He says the euro zone is a trap for Greece. He would like to see Greece out of the euro and back with her own drachma. As part of that painful transition, he advocates the nationalization of the Greek banks, tax reform so that the rich pay taxes, and the reindustrialization of the country.

He is absolutely right in claiming that the “suffocating austerity,” which the troika imposed on Greece, is to blame for the tragic and horrendous conditions in the country. He says, “Greece must lift herself up by her own bootstraps.” And part of that struggle is for Greece to return to the drachma and not expect some foreigner, the euro, to save her.

I agree with Lapavitsas, though Greece ought first to try to work out an honorable deal with the EU. I am not sure dropping out of the euro would be the right thing to do for Greece right away. However, the EU has to decide between being a plaything for the Germans doing the bidding of America, or demanding a real political union of European states for a stronger and healthier Europe that nurtures Western culture. If only the EU becomes the United States of Europe, and if it then could guarantee Greek borders, the Turkish nightmare would dissipate, allowing Greece to focus on constructive democratic and economic development. Only then will 1204 become history.

Greece does have oil, gold and other valuable resources which could help the country clear its financial insolvency and improve the well-being of her citizens. Being blessed by Helios, the Greek god of sunlight, Greece can, once again, become a heliocentric country. Solar power can power Greece, making it the center of solar energy in the Mediterranean. Greece can also become self-reliant in food. And being a cultural superpower, Greece could then become the destination of more tourists seeking pleasure and understanding of the origins and significance of Western civilization. This would also be the time when Greece invests her material wealth in recapturing her intellectual wealth from a Renaissance-like movement.

Greece has to return to her classics, edit them and make them school textbooks. Teach ancient Greek and Latin. In fact, Greek children ought to study ancient Greek throughout elementary and secondary education. Out of such a life-giving education, the core values of democracy, philosophy and science will once again dominate Greek life and culture. Ancient Greek culture is also the inspiration for the betterment of the human condition – indeed, for human survival and the healing of the natural world.

Borrowing foreign money might be useful sometimes, but Greece has to become self-reliant first. Aristotle advocated self-reliance as a pillar of independence. It’s about time Greece listens to Aristotle.

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