The Traits of the Crisis

ATHENS/BERLIN | | griechenland

ATHENS/BERLIN (Own report) - With yesterday's parliamentary elections, Greece, which is already shattered by the German austerity dictates, is entering a new phase of instability. Predictions confirm that the country's two largest parties, which until now have imposed the austerity dictates against massive popular protests, have suffered great losses. The conservative Nea Dimokratia will probably receive only about 20 percent and the social democratic Pasok hardly more than 14 percent of the votes. In Athens, even before the elections, it was being forecast that it would be impossible to create a stable government with a small majority, and that within a few months, new elections would have to be held, which would jeopardize EU and IMF financial aid. This would mean that, to obtain promises of dubious financial assistance, Greece, which has been forced to downsize its economy into an abyss, will be faced with utter ruin. The social situation is desolate. The number of unemployed, as well as of those dependent on food allocations has dramatically grown, just as the number of suicides. German enterprises, whose profitable business in Greece has contributed to the development of Athens' debt crisis, are now seeking to exploit the crisis for lucrative business opportunities. The dramatic aggravation of the situation is also flanked by a rise of the extreme right.

New Elections Soon?

According to the most recent prognoses, Greece's two major parties, which, between them, over the past few years, have usually garnered more than 80 percent of the votes, have suffered dramatic losses. The conservative Nea Dimokratia has obtained hardly more than 20 percent, and the Pasok fell to approx. 14 percent of the votes, to become the third strongest party. Parties that had unambiguously opposed the austerity dictates imposed by the Pasok and the Nea Dimokratia, gained clearly, although they do not have a majority. Already preceding the elections, high-ranking politicians of the Nea Dimokratia and Pasok parties proclaimed that, with a small majority, it could prove impossible to create a government that will be capable of imposing the austerity measures - even future ones - demanded by Berlin. Should the election results be confirmed, new elections may have to take place already in the fall or even in June.[1] Whether this would lead to a large enough majority, for example, for the Nea Dimokratia, is uncertain.


The political instability also jeopardizes the EU and IMF financial aid, having an even greater effect on Greece, which has been forced to downsize its economy into an abyss, to obtain promises of financial assistance. The austerity programs, imposed by Berlin, which, from the beginning, had been extremely controversial, have diminished the country's economic performance by 16 percent from before the crisis, and it is expected to shrink another 4.5 percent this year. "Greece's economic decline could surpass Argentina's 2001 bankruptcy," declared the SPD-affiliated Friedrich Ebert Foundation in a recent study. That country is experiencing "one of the worst economic crises (...) ever to hit the industrialized world."[2] Since the beginning of the crisis, more than 60,000 enterprises have gone bankrupt. It has been calculated that in commerce alone, 160,000 jobs were lost in 2012. The unemployment rate has already doubled to 21 percent, translating into one million job seekers in a population of eleven million. In the 15 to 24 age group, more than half (51%) are without work.


The consequences on the Greek social situation are dramatic. The Friedrich Ebert Foundation reports that, alone, between 2009 and 2011 "the Greeks' real take-home pay (...) sank on an average of 23 percent." The minimum wage and unemployment benefits were cut by 22 percent, and are currently at 360 Euros per month - plus 36 Euros per child. Unemployment benefits are accorded for twelve months only. The Friedrich Ebert Foundation points out that even representatives of enterprises had refused the reduction of the minimum wage, "imposed by the Troika."[3] Wage cuts are having consequences. For example the number of the homeless in Greece has grown by 25 percent since 2009, the number of persons unable to feed themselves has gone up as well. The church, alone, is providing meals for a quarter of a million people. Several hundred-thousand can no longer afford to pay their social insurance, needed for free or at least, low-cost medical care. A current opinion poll indicates that 87 percent of the Greek population is dissatisfied with their lives. Specialists blame the 40 percent rise in the number of suicides that have occurred since the beginning of the crisis, on the austerity dictates.

Primary Beneficiary

German companies' business with Greece is in sharp contrast to the economic development and the social situation in Greece. Until the beginning of the crisis, business had developed very profitably. German exports to this country, crumbling ever deeper into debt, grew from 6.3 billion Euros (2004) to nearly 8 billion Euros (2008), while the German trade surplus simultaneously grew from 4.7 to around 6 billion Euros, which weighed heavily on Athens' budget. It has, in the meantime, again receded due to the crisis. But German arms exports to Greece are still thriving. Athens' US $2.1 billion worth of German war material bought between 2005 and 2009, has contributed to the enormous national debt, just as the 35.8 million Euros worth of German exports licensed alone for 2010. In 2010, Athens was additionally forced to pay more than 400 million Euros for a German submarine. Germany is "one of the main beneficiaries of the Greek arms craze," declared the former Minister of Development, Heidemarie Wieczorek-Zeul. It is not right "that the German government pressure this crisis-ridden country to buy German arms material."[4]

Sell Out

Now German enterprises are exploiting the Greek crisis to seek another sort of lucrative business deals. Greece is under EU pressure to sell off an enormous portion of its state property, to plug the holes in its budget. Official German offices are "counseling" both Greek government officials and potential buyers among interested German enterprises. ( reported.[5])

Defense Against Migrants

Also in an area such as migration policy, Berlin is insisting on its national advantages, even if this means pressuring crisis-ridden Greece into extraordinary duties. Under terms of the "Dublin II" Regulations, imposed by Germany, Greece is obligated to accommodate all migrants entering the EU by crossing its borders - transit to other EU countries is not permitted. Due to its geographical location and by virtue of the size of its population, the Greek government must make a much greater effort to thwart migration into the EU than Germany. In spite of Greece's emergency situation, Germany strictly refuses either to accept a stronger role in accommodating the migrants - considered, for the most part, economically worthless - or to either completely rescind the "Dublin II" Regulations, or, at least, suspend their application until Greece has recovered from the crisis. It makes also no difference that Athens has now started to adopt extreme measures and begun erecting migrant detention camps, while the number of racist, anti-migrant pogroms is growing alongside a reinforcement of the country's extreme right in crisis-ridden Greece.

Nazi Salute in City Council

The neo-Nazi Chrysi Avgi Party, with estimated electoral results of 6.8 percent, has achieved entry into the Greek national parliament. Head of the party, Nikolaos Michaloliakos had already been elected to the City Council of Athens in November 2010, where he is known for his occasional Nazi salutes. In the Greek parliament, the Chrysi Avgi Party has replaced the extreme right LAOS Party, which until the beginning of this year, had even been in the government coalition. Chrysi Avgi is known for its militants' violent racist attacks on migrants, for its demands to annex territories of neighboring countries, and for its cooperation with France's Front National and Germany's NPD. Its electoral success is an intermediate result of the ultimate right's radicalization in Greece under the impression created by the incessantly escalating crisis.

[1] Greek Elections Seen Leading to Instability; 04.05.2012
[2], [3] Nick Malkoutzis: Griechenlands schmerzhafter politischer Wandel. Eine Analyse der anstehenden Parlamentswahlen. Internationale Politikanalyse der Friedrich-Ebert-Stiftung, Mai 2012
[4] Griechenlands Militär bleibt vom Sparen verschont; 07.02.2012
[5] see also Patterned after the Treuhand