Consider the following points:
* my understanding is that Greece’s debt was held predominantly
domestically at time of EZ entry; today it is almost exclusively held by
foreigners
* Greece’s bank deposits were close to 250 BEUR at the outset of the
crisis and are now down to, I understand, about 125 BEUR (still higher
as at the time of EZ entry!)
* the country has been totally decapitalized by nationals and the capital has been replenished by foreigners
* Greek nationals were estimated to hold a 3-digit BEUR figure in
foreign financial assets before the crisis; since then, that figure must
have increased phenomenally (not to mention the cash under mattrasses)
* translate this into a family situation: the parents incurred
phenomenal debts to acquire assets which they wrote over to other family
members who made sure that their own assets were protected. Not all
family members benefited from that. Some didn’t get any assets but are
still liable for the parents’ debt
“We have met the enemy and the enemy is us” – one could say.
Be that as it may, it is actually irrelevant today. The only thing
which is relevant today is how Greece can establish a base from which to
build something new and better. Yanis, I thought that we had once an agreement that what Greece
needed was a long-term industrial development plan; a plan not for a few
years but at least for one generation. I had proposed the McKinsey Plan
but said that if you didn’t like that, make your own plan along similar
conceptual lines. You said that this would be your top priority as
Finance Minister.
I thought that we had once agreement that what Greece needed was an
EU Task Force for Greece renamed as the “Greek Task Force with EU
support” and reporting to the PM. It’s job would be “to build a modern
and prosperous Greece: a Greece characterised by economic opportunity
and social equity, and served by an efficient administration with a
strong public service ethos.” I thought we had once agreement that, in
order for Greece to accomplish such accelerated modernization, it needed
the support of the best what Europe could offer by way of advice. You
agreed with that.
I had made a handful of other recommendations to you, with which you agreed.
Yanis, I haven’t seen anything coming from you on the issues which I
once thought we had agreement on! I could cite the advice I had given
you on how to handle the negotiations but your latest interview in The
New Statesman shows me that you had a completely different agenda. Had I
accepted your invitation to join your force, I would have quit within a
week.
Six months ago, I thought that Tsipras would be the ‘wild one” and
you would be the one bringing him back to sensible behavior. It turned
out differently. You became the ‘uncontrollable missile’ and Tsipras had
to smoothen the waves. You went for confrontation where you should have
gone for compromise.
You and I have had several exchanges about Bruno Kreisky. I once even
suggested to you that SYRIZA should form a team to go to Vienna and to
be lectured about “Kreiskyism”. In a nutshell: Kreiskyism meant “If we
want to milk the cow, which is what we intend to do, we first have to
make sure that the cow is and remains healthy”. Kreisky had a Finance
Minister (Androsch) who led him the right way. Tsipras, I regret to say
this openly, chose a Finance Minister who led him the wrong way. Kreisky
was a true Social Demoract without being boggled down by ideologies or
hidden agendas.
I truly think that Tsipras now has the opportunity of a lifetime for
Greece. He seems to have the support of his political opponents and he
can afford to lose the support of his crazy party members without
forfeiting his mission. What Tsirpras now needs is the advice and strong
support of those who know how the cow can be made healthy and strong so
that it can be milked for the benefit of Greek society. The definition
of Greece’s problems is so easy. All it needs are the right solutions.
Let me repeat: I think the McKinsey Plan offered a lot of right
solutions. If you don’t like it, come up with a better plan but DO COME
UP WITH A PLAN!
The principles of finance have been turned upside down here. When in
trouble, managements normally are asked to come up with a plan and
lenders contemplate whether they are prepared to finance that pan. In
Greece, all energies were spent on structuring the financing without
having a plan. If Greece ever came up with a convincing long-term
industrial development plan, lenders would undoubtedy look favoraby upon
financing it.
Every article you write and every interview you give explaining “who
has done what to whom” is a complete waste of time. Please use your time
for something constructive; for proposing alternative economic plans
which the Greek government could pursue in order to return the country
to prosperity.
Consider the following points:
* my understanding is that Greece’s debt was held predominantly domestically at time of EZ entry; today it is almost exclusively held by foreigners
* Greece’s bank deposits were close to 250 BEUR at the outset of the crisis and are now down to, I understand, about 125 BEUR (still higher as at the time of EZ entry!)
* the country has been totally decapitalized by nationals and the capital has been replenished by foreigners
* Greek nationals were estimated to hold a 3-digit BEUR figure in foreign financial assets before the crisis; since then, that figure must have increased phenomenally (not to mention the cash under mattrasses)
* translate this into a family situation: the parents incurred phenomenal debts to acquire assets which they wrote over to other family members who made sure that their own assets were protected. Not all family members benefited from that. Some didn’t get any assets but are still liable for the parents’ debt
“We have met the enemy and the enemy is us” – one could say.
Be that as it may, it is actually irrelevant today. The only thing which is relevant today is how Greece can establish a base from which to build something new and better.
Yanis, I thought that we had once an agreement that what Greece needed was a long-term industrial development plan; a plan not for a few years but at least for one generation. I had proposed the McKinsey Plan but said that if you didn’t like that, make your own plan along similar conceptual lines. You said that this would be your top priority as Finance Minister.
I thought that we had once agreement that what Greece needed was an EU Task Force for Greece renamed as the “Greek Task Force with EU support” and reporting to the PM. It’s job would be “to build a modern and prosperous Greece: a Greece characterised by economic opportunity and social equity, and served by an efficient administration with a strong public service ethos.” I thought we had once agreement that, in order for Greece to accomplish such accelerated modernization, it needed the support of the best what Europe could offer by way of advice. You agreed with that.
I had made a handful of other recommendations to you, with which you agreed.
Yanis, I haven’t seen anything coming from you on the issues which I once thought we had agreement on! I could cite the advice I had given you on how to handle the negotiations but your latest interview in The New Statesman shows me that you had a completely different agenda. Had I accepted your invitation to join your force, I would have quit within a week.
Six months ago, I thought that Tsipras would be the ‘wild one” and you would be the one bringing him back to sensible behavior. It turned out differently. You became the ‘uncontrollable missile’ and Tsipras had to smoothen the waves. You went for confrontation where you should have gone for compromise.
You and I have had several exchanges about Bruno Kreisky. I once even suggested to you that SYRIZA should form a team to go to Vienna and to be lectured about “Kreiskyism”. In a nutshell: Kreiskyism meant “If we want to milk the cow, which is what we intend to do, we first have to make sure that the cow is and remains healthy”. Kreisky had a Finance Minister (Androsch) who led him the right way. Tsipras, I regret to say this openly, chose a Finance Minister who led him the wrong way. Kreisky was a true Social Demoract without being boggled down by ideologies or hidden agendas.
I truly think that Tsipras now has the opportunity of a lifetime for Greece. He seems to have the support of his political opponents and he can afford to lose the support of his crazy party members without forfeiting his mission. What Tsirpras now needs is the advice and strong support of those who know how the cow can be made healthy and strong so that it can be milked for the benefit of Greek society. The definition of Greece’s problems is so easy. All it needs are the right solutions. Let me repeat: I think the McKinsey Plan offered a lot of right solutions. If you don’t like it, come up with a better plan but DO COME UP WITH A PLAN!
The principles of finance have been turned upside down here. When in trouble, managements normally are asked to come up with a plan and lenders contemplate whether they are prepared to finance that pan. In Greece, all energies were spent on structuring the financing without having a plan. If Greece ever came up with a convincing long-term industrial development plan, lenders would undoubtedy look favoraby upon financing it.
Every article you write and every interview you give explaining “who has done what to whom” is a complete waste of time. Please use your time for something constructive; for proposing alternative economic plans which the Greek government could pursue in order to return the country to prosperity.