In Greece, the crisis is making people ill (literally)
ATHENS – When you touch down in Athens, the signs of an economic slump are immediately evident. The arrivals hall in the domestic terminal is almost deserted, with flights within Greece having been cut back by about 25 percent. Outside the taxi pick-up point stretches a long line of yellow cabs going nowhere. It is symbolic of Greece’s economy – stretched and stuck.
On the ride into town the driver explains that he’s been waiting for me for seven hours. I was his second and last fare of the day.
Greece still holds the magic of an ancient Mediterranean country. The Acropolis, its columns lit majestically at night, juts grandly above Athens. It is a testament to one of the world’s great civilizations.
But down here on the street, there is fear that Greece is unraveling as a modern state.
‘Economic death spiral’
You don’t expect to see so many hungry people in a major European city. They line up each day looking for a handout in the soup kitchens and bread lines run by the municipality. But the 40 workers under contract to prepare a basic lunch of pasta and bread say they will lose their jobs in June because the city has run out of money to pay them.
Essentially, the country is broke. And to borrow enough money to stay solvent, the Greek government has agreed to severe austerity measures imposed by the European Union, European Central Bank and the International Monetary Fund. The money will run out next month unless another chunk of the bailout is handed over. But the European Union wants even more cuts in government job, salaries and benefits.
Public employees have already taken a 40 percent pay cut and pensions are being reduced. The private sector has also been hit and unemployment is nearing 20 percent. A staggering 40 percent of youths between the ages of 18 and 24 are without jobs.
Take, for instance, Leo, a 64-year-old painter of religious icons for devout Greeks and tourists. His business dried up. The money ran out and he ended up living on the street. Evicted for not paying rent, Leo, who didn’t give his last name, took warm clothes, books and ten boiled eggs to his new home – a metal bench near a park in central Athens. He spent 45 days in the open with what he called the “unhappy homeless.”
What makes Leo unhappy is the realization that the government is to blame. “They borrowed,” he said. “Every time they needed money they borrowed and then borrowed some more.”
Successive Greek governments borrowed an estimated $498 billion, in essence to bribe the Greek people into being happy. Governments who could offer cushy office jobs, fat pensions and long vacations got re-elected. It made perfect political sense, but it was economic suicide.
A businessman in the aviation industry described the country, “as gripped in an economic death spiral.”
Enough to make you sick
Yiannis Varoufakis, a professor of economics at Athens University was just as blunt when he told me, “This is Greece’s Great Depression. If you look at the statistics it is indeed a deeper slump than what Greece went through in the 1930s.”
Imagine for a moment taking a 40 percent pay cut. Then suffer an increase in sales tax to 23 percent. Add on increased rates for electricity, a new tax on heating oil and the cost of a gallon of gas hitting almost $10. Oh and your pension is not secure, and your kids stay home because there aren’t enough teachers. It is enough to make you sick.
And that’s precisely what the Greeks are doing. Getting ill. Hospital admissions are up 25 percent. At the same time hospital budgets have been cut 40 percent so there are shortages of medicine and staff.
Nikitas Kanekis is the director of Doctors of the World, a charity that runs health clinics. He has the genteel manner necessary to be a pediatric dentist, but the economic decline has unsettled him. “We have seen four times the number of Greek patients over the last year,” he said. “We are afraid the humanitarian crisis can develop into a humanitarian catastrophe.”
It may already be happening. The department of health reports that suicides are up 40 percent. And violent crimes including murder are up almost 100 percent. “We have all the characteristics we see in big cities in the Third World,” said Kanekis. “People with no shelter, starving people and people looking for doctors and medicine.”
Fears about what may come next
Greek coalition leaders are meeting Wednesday to prepare their response to a draft deal on steep cutbacks demanded by creditors in return for a $170 billion bailout that could protect the country from looming bankruptcy.
They need the money to stave off crunch time on March 20 when a big bond redemption payment is due. Without the bailout, they risk a default that could send shockwaves throughout financial markets and the global economy.
No one is certain it will happen. To receive the previous handout, Greece promised to cut 30,000 public-sector workers, but only 1,000 have been let go. The government also promised to sell off 65 billion euros in state owned assets. So far only 2 billion have been sold.
The government is trying to raise money through increased taxation. There’s a new property tax that is collected through the state-owned electric company. If you don’t pay the tax your electricity is cut off. There’s a luxury tax to hit the wealthy – a 30 percent tax on sports cars and yachts. There’s even a tax on private swimming pools. The government is reportedly using Google earth to pinpoint pools even as some Greeks are said to be using camouflage nets to hide them.
Even the Greek Orthodox Archbishop Hieronymos II of Athens and All Greece, who rarely comments on issues not related to the church, is worried. “The unprecedented tolerance of the Greek people is being exhausted, rage pushes fear aside and the danger of social upheaval cannot be ignored anymore,” he warned in a letter sent to interim Greek prime minister.