The pro-rupture article of uncompromising Minister Lafazanis


So, it’s been a long time since I have run any update on the blog. I return with the pro-rupture, uncompromising OP-ED article published today in Greek CRASH magazine by Panagiotis Lafazanis, the Greek Minister of Reconstruction of Production, Environment & Energy. Bear in mind that Lafazanis is one of the most hardcore members of Syriza’s Leftist platform. He is also one of the most influential. Once again, I translated the whole thing, leaving all judgment to you. The Greek version can be found in the website of the Ministry, here. In what follows, you can read my English translation.



Article of the Minister of Reconstruction of Production, Environment & Energy Panagiotis Lafazanis, published in today’s Crash magazine

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GR Political Economy Digest #17


While Friday’s Eurogroup storm seems to have passed, today is an equally (if not more) important date for the fate of Greece. Yanis Varoufakis, the Greek Minister of Finance, is expected to send a list of proposed reforms to TIFKAT (The ‘Institutions’ Formerly Known As Troika) for approval. Analysts, markets, and entire governments might have sighed in relief on Friday, but it is today actually that will illuminate whether a substantial compromise has been reached in the last Eurogroup meeting.

There is not much to say at this point, other than to wait and see what Varoufakis has planned. The list of reforms is expected to be quite short (no longer than 3-5 pages) and concise. Hopefully, it will also include meaningful proposals that speak more of a “compromise,” rather than the hardcore Left platform of Syriza or ANEL. “Wait, what?,” you may ask. “Who cares about those hardcore Lefties and the few ultra-nationalist crazies of ANEL? They are a fringe part anyways, right? And they wouldn’t jeopardize their ascent to power so soon, would they? As long as the moderate part of Syriza is willing to compromise, then there is no problem!” Well… I would love to share your optimism, but I am quite wary of the influence of the anti-austerity and anti-reform hardliners. I am also quite confident that we will witness some important schisms in the next couple of weeks – iff (if and only if) Varoufakis and Tsipras are true to Friday’s deal. Some senior Syriza officials and important figures of the Left have already begun speaking up (Manolis Glezos, John Milios, Sofia Sakorafa, and even Mikis Theodorakis). I suspect that more voices will soon follow in tune. Will that be enough to bring the government down? This is extremely early to say. But don’t be surprised if the inter-governmental dynamics change drastically in the upcoming weeks.

In any case, happy Lent Monday everybody! Here is the list of the top articles to read on the political economy of Greece today: 

  1. Greece: Four more months of hope and risks, by Frederik Ducrozet | Credit Agricole CIB, Feb 23 2015
  2. Greek bailout: Athens submits economic reform plan today (Live updates), by Graeme Wearden | The Guardian, Feb 23 2015
  3. Tsipras tamed as economists declare Greece loses austerity fight, by Simon Kennedy & Jennifer Ryan | Bloomberg, Feb 23 2015
  4. Greece scrambles to send draft reforms to EU institutions, by Peter Spiegel & Kerin Hope | The Financial Times, Feb 23 2015
  5. In defence of can-kicking, by Duncan Weldon | Medium, Feb 23 2015
  6. A hard week ahead for Greece after a last-minute deal, by Max Ehrenfreund | The Washington Post, Feb 23 2015
  7. Greece’s future is its past, by Rebecca Harding | Pieria, Feb 23 2015
  8. Greece: A debt colony with a bit of “home rule”, by Paul Mason | Channel4 News, Feb 23 2015
  9. Varoufakis ‘absolutely certain’ Greek reforms will meet approval | Deutsche Welle, Feb 22 2015
  10. Spain said to lead EU push to force terms on Greece, by Nikolaos Chrysoloras & Karl Stagno Navarra | Bloomberg, Feb 22 2015
  11. Ten days that shook the euro; how Greece came to the brink, by Alastair MacDonald & Jan Strupczewski | Reuters, Feb 22 2015
  12. Greece readies reform promises, by George Georgiopoulos | Reuters, Feb 22 2015

Photo Credits: Ilias Makris (Kathimerini, 22.02.2015)

GR Political Economy Digest #15


So many things have happened in the past week or so. And so many more are to come until the month is over.

Today, late at night, Syriza will announce its nomination for the new President of the Democracy (PtD) in Greece. Name-dropping about who will be nominated for PtD has begun as early as before the January elections. Two names that figured prominently in the rumors and speculations circulating via the Greek press are Dimitris Avramopoulos, a career-diplomat and former Minister in various Greek cabinets, currently serving as the European Commissioner for Migration, Home Affairs, and Citizenships, and Kostas Karamanlis, the former Prime Minister of Greece. Both of these people come from the New Democracy party (currently in opposition), and are considered emblematic figures of the center-right. Another name that circulated in the Greek press in the past few days is Marietta Giannakou, another (highly esteemed) member of the New Democracy party, who has served twice as Minister in a Greek cabinet, and was a MEP from 2009 to 2014. Out of the three, Giannakou is the less controversial choice, and the person with the biggest and most meaningful work legacy while in office. Nevertheless, given that she is facing some serious health problems at the moment, the chances are slim that she would be selected.

If you might wonder as to why the radical-left Syriza would nominate a center-right politician as the new PtD, no need to give it too much thought. It is standard practice for many years now in Greece for the party in power to nominate a seemingly un-harmful politician from the opposition as PtD, especially given the limited authority and leverage entailed with the ceremonial position. It is a clever tactic to show willingness to compromise in the spirit of democratic politics.

Tomorrow, Prime Minister Alexis Tsipras will meet with the Eurozone finance ministers to continue the negotiations that went south in last week’s Eurogroup. Tsipras remains confident that a viable solution will be found and that the negotiations will result in a “win-win” situation for all relevant parties. While the foreign press has largely drawn attention to the thin thread upon which Greece is currently walking on (as well as the devastating repercussions that will follow for the rest of the Eurozone if that thread won’t be able to hold Greece’s weight), Syriza’s official announcements, as well as the majority of the Greek press, have been intentionally painting a very rosy picture of the negotiations. For instance, while the Greek Finance Minister Yanis Varoufakis was, by and large, isolated in last Thursday’s Eurogroup meeting in Brussels, Greek media (TV, newspapers and portals) turned him into a heroic figure that supposedly went into the meeting with confidence, held the country’s head high, and “stole the show.”

Unfortunately, the reality is that Thursday’s Eurogroup meeting did not go that well. In fact, it didn’t go well at all. Varoufakis gave his (typical by now) theoretical talk, using fancy words and grand ideas. There were no data, no charts, no numbers from the Greek side. This, of course, did not sit well with the rest of the Eurozone partners who want exact numbers, specific percentages, and clear-cut reform proposals. But more importantly, at the last minute, when everyone thought that there was an agreement on the common press statement typically released at the end of the meeting, Varoufakis broke the consensus and no statement was released. By that time, many Finance Ministers, such as Germany’s Wolfgang Schauble, had already left the building.

I hope that tomorrow’s meeting will be more fruitful. We have already started to see certain glimmers of realism from the Greek side, something that even the Germans seem to have noticed. Given the number of protests that are planned to happen around Europe today in support of Greece, there might be a good chance that Germany will be pressured to loosen its stance. But this is only going to happen if Greece arrives at the meeting with neither generalities nor Varoufakis’s game-theory gimmicks, but rather with serious proposals, concrete plans, and specific numbers.

Without further ado, here are the top reads on the Greek political economy for today: 

  1. Eurozone must not allow Greece to become another Lehman Brothers, by the Business Leader | The Guardian, Feb 15 2015
  2. Greek prime minister ‘full of confidence’ ahead of Eurogroup meeting, by Caroline Copley | Reuters, Feb 15 2015
  3. Greeks brim with pride as country totters on the edge, by Karolina Tagaris and Deepa Babington | Reuters, Feb 15 2015
  4. Geopolitics versus politics in Greek debt drama, by Paul Taylor | Reuters, Feb 15 2015
  5. Greek exit from eurozone would be worst option, says bailout fund chief, by Andrea Thomas | The Wall Street Journal, Feb 15 2015
  6. Reforms, bloody reforms, by Frances Coppola | Coppola Comment, Feb 15 2015
  7. Eyes of the world on Greece, by Mike Peacock | Reuters, Feb 15 2015
  8. Greece’s Excess Burden, by Paul Krugman | The New York Times (Krugman’s Blog), Feb 15 2015
  9. SDOE to receive more power to go after tax evaders | Kathimerini, Feb 15 2015
  10. Greece and the euro: Hitting the ground running—backwards | The Economist, Feb 14 2015
  11. Greece faces  the cold stare of its creditor countries, by Arthur Beesley | The Irish Times, Feb 14 2015


Image Source: Ilias Makris (Kathimerini)

GR Political Economy Digest #12

eikonaki Once SYRIZA was elected in power (with the help of ultra-nationalist Independent Greeks), the international media were on an ecstatic frenzy. A historic win for the Left, coupled with the fact that it was achieved by a past underdog under the direction of a very young new leader, Alexis Tsipras, seemed like the perfect story for the media. Today, five days after the Greek parliamentary elections, the tone has turned from almost delirious to extremely worrying. It seems that everyone – including SYRIZA’s supporters – were betting on a softening of the party’s stance, once it came into office. But SYRIZA has shown no intention to tone down its rhetoric and move away from its worrisome programmatic pledges. In fact, SYRIZA has remained adamant in its pre-electoral promises. Although this is a fresh feeling for the Greek society, which is very much used to the U-turns of politicians once they get elected, it is also an evident cause for alarm – due to the nature of Syriza’s promises and intentions.

Greece has to fulfill its running obligations with its international lenders within the next few months, it needs to receive the last chunk of bailout money in order to pay salaries and pensions starting this month, and more than anything, it needs to implement the necessary structural reforms in order to open up the state and market within the country, changing the existing clientelistic political system, combatting the oligarchic structure, and tackling the problems arising from the extensive shadow economy and crony capitalism in place. Yet, what we have seen in the first few days of SYRIZA’s rule is not exactly close to ‘promising’ in bringing substantial change to the country. SYRIZA has pledged to re-hire about 10,000 former workers in the public sector (who have been fired due to its downsizing); it has announced that it would block all further privatizations pertaining to the biggest port in Greece, the Peireus Port, and has assumed a similar stance in regards to the country’s multiple regional airports; it has jeopardized the (unusual!) consentual agreement of all member states of the EU in regards to the sanctions against Russia after further aggressions in Ukraine; and it has stated (via the current Minister of Economics, Yanis Varoufakis) that Greece ‘does not need the last 7 billion euros’ coming from the final loan disbursement.

SYRIZA is playing an extreme form of hardball with the TROIKA and the totality of our European family. As things look now, it either has some extraordinary cards under its sleeves (an agreement with our European counterparts about debt-relief of some sort is quite possible. Straightforward debt-reduction seems highly unlikely.), which it will present in a sugarcoated manner to the Greek people in the upcoming weeks; or it is actually more honest than all of us expect, is prepared to collide with Europe, and ready to gamble the fate of the country within the EU/EZ, even if it does not have enough firepower to fuel a ‘heroic exodus.’

My prediction is that SYRIZA will perform a magnificent ‘kolotoumba’ soon (if it has not already, unofficially, under the table with the other Europeans). It is not a matter of where the party stands normatively in their economics or ideologically in their politics. It is a matter of hardcore realism. And when Varoufakis and Tsipras are faced with the fatal question of “how are we going to pay up for the salaries and pensions of millions of people,” the dilemma of playing hardball or joining the chorus of former Greek leaders who performed eloquent ‘kolotoumbes’ in order to save the country’s economy will (hopefully) disappear.

In any case, here is what you need to read about the Greek political economy today:

  1. Greece and its discontents, by the Charlemagne | The Economist, Jan 31 2015
  2. Greece and the euro’s future: Go ahead, Angela, make my day | The Economist, Jan 31 2015
  3. Europe’s Greek Test, by Paul Krugman | The New York Times, Jan 30 2015
  4. Portugal Won’t Join Greece in Debt Renegotiation |, Jan 30 2015
  5. Greece awaits EU finance meeting; eurozone deflation deepens (With live updates), by Angela Monaghan | The Guardian, Jan 30 2015
  6. Greece really might leave the euro, by Matt O’ Brien | The Washington Post, Jan 30 2015
  7. Greece’s Political Chimera, by Nikos Konstandaras | The New York Times, Jan 30 2015
  8. Fitch: Greece-Troika Deal Still Possible but Risks Are High | Reuters, Jan 30 2015
  9. Greece looking for common ground with European partners, by Stelios Bouras and Alkman Granitsas | The Wall Street Journal, Jan 29 2015
  10. Greece Steps Back Into Line With European Union Policy on Russia Sanctions, by Andrew Higgins | The New York Times, Jan 29 2015
  11. Global Economy: Greece, EMU and democracy, by Antonio Fatas |, Jan 28 2015