The Real Greek Tragedy

Trying to follow the Greek financial crisis is a bit like watching a piece of surrealist theatre. You struggle to understand what your eyes are seeing.

Greece is the weakest of the European economies, but this was the case in 2002 when it dumped the drachma, and became part of Euroland (or the Eurozone as it likes to be called). Economists knew then that Greece did not fully fit entry requirements, so the decision was a political one, rather than an economic one. Joining Euroland meant that Greece had access to borrowing, that was previously denied it. It took advantage, and went on a spending spree. Public spending soared, and public sector wages practically doubled over the last ten years. Expenditure greatly exceeded income, and it needed to borrow money to fill in the gap. It became too expensive to borrow money commercially, so they turned to the European Union and the International Monetary Fund for a 'bailout'.

The Irish Republic and Portugal had already received bailouts, and in May 2010, it was given a bailout loan of 110 billion euros. It is now looking for a further 109 billion euros to pay its bills, and the European Commission (EC), the European Central Bank (ECB) and the International Monetary Fund (IMF) will meet in Athens tomorrow to review the situation. It seems likely that a further bailout will be forthcoming.

The aim of the bailouts is to shore up Greece's economy, calm the financial markets, and stop the problem spreading to other debt-laden European economies. It is also being driven politically by Germany and France to ensure that the "European dream" does not fall apart. Of the 17 countries who adopted the euro as its currency, 5 are in severe problems over debt - Greece owes about 340 billion euros; Ireland is forecast to owe about 173 billion euros by the end of 2011; Spain owes about 630 billion euros; Portugal I can't work out, and Italy has a massive 1.9 trillion euros of total debt. It may be of interest to note, that while the UK is not part of Euroland, its debt at the moment is around £940 billion.

Economists like to talk in complicated language about the debt crisis, and the reasons for it. Some see a reason for inadequate income generation as "rampant tax evasion", with the Greek labour minister estimating that a quarter of the economy pays nothing. While you have to condemn tax evasion, surely the fault must also lie with the Government's inability to collect taxes. I think though that the problem is much more corrupt. Greece was never going to be able to pay its debts, and it knew it. The IMF and the ECB knew that Greece was never going to pay its debts, but it still gave out loans, to try and keep Euroland alive. This is all so dishonest, reprehensible and irresponsible. You don't have to be an economist to know that if I spend more money that I get in, I'm in trouble, and no-one will bail me out. If I take out a loan knowing that I won't have the means to pay it back, makes me guilty of fraud, and no-one will bail me out. Governments however can do it, and ask to be bailed out.

Many observers in the financial markets see it as inevitable that Greece will default on its debts, and when this happens, the same will be true of Ireland and Portugal. The only question being discussed in some quarters is to whether the default will be "orderly" or "disorderly". This is econospeak. An orderly default means that a substantial part of the debt is rescheduled so that repayments are pushed back decades. Euroland leaders are proposing a 50% write-off of money loaned by private lenders, which they describe as a "haircut". A disorderly default would mean that much of this debt is not repaid - ever. The fear is that whichever default takes place, other countries such as Ireland and Portugal will follow suit, and the effect will be felt across Europe, as well as further afield.

Some may be asking, what has all this to do with us? So what if Euroland collapses; we're not part of it, and if the IMF etc want to go on propping up failing economies, let them get on with it.

If only we could distance ourselves from all of this so easily. But we can't. Did you know that the UK has already handed over £12.5 billion in emergency loans to Greece, Ireland and Portugal to help prop up the euro? Why has it done this with our money? The simple reason is to avoid losing more money. The chart above shows the countries that are most exposed to Greek debt. France is the greatest with a total of 56.7 billion dollars at stake. The UK has a debt exposure of 14.6 billion dollars. If Portugal defaults on its debts, the UK banking sector is exposed to the tune of £29.5 billion, and the largest foreign lenders in Ireland are UK banks. If UK banks end up losing out, what do you think will happen? Yes, an appeal to the Government for their own bailout, and who pays for this? The UK taxpayer.

Even if none of this happens, the crisis is going to cost us a lot of money. Christine Lagarde, IMF managing director says that the current £250 billion 'war chest' was insufficient, and "pales in comparison with the potential needs of vulnerable countries, and needs to be expanded to deal with the worst-case scenarios". A new target fund of £2.6 trillion has been proposed, which, because of the agreement with the IMF that the UK has signed up to, will mean that the UK is liable for 4.5% of this, around £115 billion contributed to an enlarged bailout fund. This is the equivalent of £4,600 per household.

Enough about money. Enough about countries. Enough about the IMF and other financial institutions. The real Greek tragedy is what is happening to its 11 million of a population.

To get financial aid, the Greek Government is forced by the ECB/IMF to institute what is known as "austerity measures". These are bad, with worse to come.

Through strikes and marches, the Greek people are saying that they've had enough, and that they're running out of patience with the austerity drive that is ruining their lives.

They are enduring wages cuts, benefits cuts, pension cuts, and rising unemployment. The graph opposite shows that since about April 2009, unemployment has risen from just over 8% to it present level of 16.2% (42% for youth unemployment). It is said that 1,000 jobs a day are being lost. The wages for 30,000 public sector workers will be cut by one fifth, and pensions for all by 10%. In actual fact, pensions paid to those younger than 55 will be shaved by 40% for the amount exceeding 1,000 euros a month. In addition, crime, homelessness, emigration and personal bankruptcies are on the rise.

According to Marcus Walker of The Wall Street Journal, "The most dramatic sign of Greece's pain, is a surge in suicides". About 40% more Greeks killed themselves in the first five months of this year than in the same period last year. The suicide help line, Klimaka used to get four to ten calls a day, but "now there are days when we have up to 100". This is in a country with a strong stigma attached to suicide. The Greek Orthodox Church forbids funeral services for suicides unless the deceased was mentally ill. Because of this, families often mask suicide deaths as accidents. Click here to read the heart-wrenching story of Vaggelis Petrakis. Here as I say is the real Greek tragedy; what is happening to its people under the guise of austerity measures. What is happening there, can happen anywhere. The cruelest toll being exacted in this crisis is the death of decent, hard working, dignified people, and the humiliation of so many more.

The European dream destroys democracy, destroys countries and destroys people. What happened to independence and individual country responsibility? Why can't we support each other without formal alliances? Where is the incentive to be prudent and frugal, when you know that there is a bailout around the corner for profligacy? In a recent poll, 80% of Greek people said that they refused to make any more sacrifices to get EU/IMF aid. I can understand where they are coming from. Never forget the real Greek tragedy.

What of the politicians? Let me finish with a comment from CNN in America. "It is still possible that the Europeans can come to grips with this crisis before we end up in a replay of Lehman Brothers, but in a depressing replay of 2008, for now it seems, that the flavour of the day is wishful thinking".

Northern Ireland - a few days of sadness

Belfast Riot 20th June 2011

While in town today, I treated myself to lunch. Jacket potato, chicken curry and a side salad. Very filling, very nice and just £3. The news came on the television, and there was a report of last night's riot in East Belfast. I thought, 'Oh no, not again'. The pictures on screen (see above) could have come from any time over the last 40 years.

On returning home, I checked out the various news outlets to see what was being said, and a familiar story unfolded. The riot happened in the Lower Newtownards Road area of East Belfast, with the main target being the Short Strand district. The BBC reported that "a large group of masked loyalists rioted overnight in the Lower Newtownards Road attacking police vehicles with petrol bombs as well as homes in east Belfast's Short Strand area". Up to 500 people were involved in the rioting, and it seems as if shooting was heard from both sides. For those unfamiliar with the geography of this area, the Short Strand is a mainly Nationalist (Catholic) area with a population of about 3,000. It is surrounded by a generally Unionist (Protestant) population of about 80,000. The inter-face between the two communities has always been tense.

One of the Councillors based in the Short Strand is Niall O Donnghaile (Sinn Fein), who is also this years Lord Mayor of Belfast (incidentally the youngest Belfast Mayor ever at 25). Sinn Fein believe that the rioting was orchestrated by the Ulster Volunteer Force (UVF), and this was also the view of the Police Service of Northern Ireland (PSNI). The UVF is supposed to have declared a ceasefire. Mr O Donnghaile says, "There is no doubt that this was unprovoked and was a carefully orchestrated and planned attack on this area". The Ulster Unionist, Michael Copeland, while not denying UVF involvement said that he believed the violence followed attacks on Protestant-owned homes in the Lower Newtownards Road. So it was retaliation.

There you have the classic Ulster position. It was "them" who started it, not "us". As ever, the BBC Ireland Correspondent, Mark Simpson summed it up beautifully. "The riot in east Belfast was another reminder that Northern Ireland has a peace process but it does not have peace". The process is moving forward, in spite of the efforts of those from both sides to de-rail it, and the process must continue, even if, god forbid, a few generations must pass before true peace is accomplished.

Lord Mayor Niall O Donnghaile

While last night's riot in East Belfast is disturbing, it is unfortunately something that does occur from time to time. Without any apology, I say that of far more sorrow to me was the report published a few days ago in Northern Ireland on the suicide rate in 2010.

A total of 313 deaths were recorded as suicides, which is the highest number ever recorded in Northern Ireland for a single year. I came across this figure while reading a website article by the Mayor of Belfast. He said, "Last year 313 people took their own life which is a record for the North. I am extremely concerned that many of those who died were young people who came from social disadvantaged areas. This year has also seen the highest number of maternal suicides with five women taking their own lives, which is an extremely worrying development, and shows that more needs to be done to support new mothers. Areas of North and West Belfast have nearly twice the death rate through suicide as the rest of the North, and young males are particularly at risk. ... We need to look at ways of combating this in a way that encompasses all agencies working together, rather than the piecemeal approach currently taken".

Of the 313 deaths, 240 were males and 73 were females, with the most common age group being between 25 and 34, though 1 in 8 deaths were in the over 60's age group. The report was presented by The Institute of Public Health, and its Associate Director, Owen Metcalfe said, "Men's health issues in times of economic recession are made more difficult by their tendency to take fewer health preventative measures, and be less likely to seek support. The combination of perceived inadequate service responses and the reluctance of many men to communicate their problems mean that a large proportion of more critical effects are undoubtedly hidden". The report linked unemployment and the current economic climate to the rise in mental health problems in men in Northern Ireland. High stress levels, over-use of alcohol and drugs, relationship problems and isolation were among the main causes.

To cover the period 2006 - 2011, The Northern Ireland Suicide Prevention Strategy and Action Plan was produced, called "Protect Life - a shared vision". While being a fine document, it is clearly not working, and perhaps the Mayor is right when he mentions the "piecemeal approach currently taken". Northern Ireland has a population of around 1.7 million, and while suicide rates as a percentage of the population (0.018%) are on a par with the Republic of Ireland and Scotland, they are way too high. Looking at the figures for the last few years tells us that we are not getting to grips with the problem. With suicide figures in brackets, we can note the following: 2005 (231); 2006 (291); 2007 (242); 2008 (282); 2009 (260); 2010 (313).

I find it interesting to compare these figures with those who took their lives during 'the troubles'. In April 1991, The Ulster Medical Journal (Volume 60, number 1), published an article where researchers examined methods of suicide between 1964 and 1988. During that 24 year period, 2168 people committed suicide, which is an average of 90 per year. However, in the early to middle 1970's, at the height of the troubles, the rate was just 50 per year. So, since the end of years of escalating violence, the suicide rate has increased dramatically, and largely in the same areas that felt the full brunt of violence.

Thankfully, attitudes to suicide have changed over the centuries. LaRita Archibold, in an excellent summary of attitudes, called "Religious Reflections on Suicide" says, "Legal and social attitudes about suicide throughout history evolved from canonical law. During the Middle Ages, the suicide was deemed as low as the lowest criminal, and was discouraged by exhibition and desecration of the body, defamation of the memory and confiscation of the estate by the government, leaving the surviving family ostracized and destitute. Attempters (of suicide) were punished by flogging, imprisonment and were stripped of all social and financial assets. Desecration of the corpse and forfeiture of estate were not legally abolished in England until 1823. In 1961, England repealed its law making attempted suicide a crime". So, only 50 years ago it would have been a crime to attempt suicide.

Unfortunately, there is however still a stigma associated with suicide which presents a large barrier to giving help. There is an excellent website called "Stamp out Suicide", and in trying to explain stigma it says, "Death is not something we discuss in everyday conversation. We do not feel comfortable in the knowledge that we will die someday and so such conversations are not commonplace. Indeed, given that we are driven by our survival instinct, is it little wonder we find it particularly difficult to comprehend when we hear that someone has taken their own life? Because people do not feel comfortable talking about death, and because there is a stigma associated with suicide, people who are suicidal may withhold their feelings and not seek help. This presents a major problem".

Arguably, there is more isolation than there has ever been, and the reasons for suicide are many and varied. However, there is one thing that all people either attempting, or committing suicide have in common; they can see no way forward except to take their life. They are feeling down, distressed and depressed, and what they need is empathy, help and support. Men, notoriously see it as a weakness to share their feelings, and so hide what they are going through from those around them. In a distressed state, we cannot see a way forward on our own, but there can be a way, but it might need others to show us that way. There are no easy answers, and I wouldn't pretend to have any, but it's a truism to say "that once a suicide is completed, there is no cure". We all can play a part by watching out for family, friends and neighbours; get over the stigma and be available to provide help.

So, in East Belfast, rioters were engaged in summer rituals of hating your neighbour, while individuals in the same city are struggling with how to get through today.

"Although we live in an ever changing world, showing compassion must never go out of fashion".