March 1st, 2010
10:25 AM GMT
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The size and scale of the protests in Greece were hard to ignore. Athenians filled Constitution Square in the heart of the capital protesting the austerity measures being put forward by the government of George Papandreou. This is his first major test on the ground since taking office last autumn.

It is quite easy to be swept up into the strike action in Greece and the other labor protests we have been witnessing in Europe during this winter of discontent - affecting industries from the airline sector (Lufthansa and British Airways) to the energy sector (French giant Total) - but it would be a mistake to see them as classic disputes over wages.

In Greece, Spain, Portugal and Italy protests go right to the heart of what many in the labor movement and broader society see as a birthright - to continue to enjoy benefits that in today's globalized world are disappearing fast.

Taking Greece for example, investors saw the recent strike by Ministry of Finance workers as somewhat ironic since they are the very members of the civil service who are at the forefront of the restructuring plan itself. It is not often discussed, but many government workers enjoy preferential tax rates, can retire at the age of 54 (in some cases earlier) and enjoy 14 months of pay for 12 months worked.

The Papandreou government is trying to reign in some of those policies. But as leader of the socialist movement, Pasok, those that brought him into power were not expecting changes to what they consider sacred covenants of their day-to-day existence.

I had a chance this year in Davos to share a tea with the Greek Prime Minister who seemed extremely determined to get the job done. He conveyed a certain Zen-like calm about what the job entails. The Prime Minister recalled having to defuse a university sit-in during his first week on the job as Education Minister (in his father’s cabinet), then in his early days as Foreign Minister dealing with a huge row with Turkey over Abdullah Ocalan, the Kurdish rebel leader who was on Greek soil.

While those were big challenges for a cabinet minister, this scale of top-to-bottom reform is clearly in a different league altogether. In today's crisis, no one is really arguing that there will have to be sacrifice, more how deep the pain will go. The strike is an effort by workers and students to carve a line in the marble so to speak.

As this Greek drama plays out with huge consequences for the country's people and finances, there are many in Frankfurt, Paris and Brussels who are looking back at the brief history of the Euro and what led to this "Southern Med" crisis.

There is a lesson in this effort for the counterparts in the Middle East, particularly in the Gulf where development of the single currency is underway. European countries were forced to come together after World War II. Major schisms can provide impetus for change, but it does mean leaders need to build the foundation of the process carefully.

One of the key architects of the European monetary union, former European Commission President Jacques Delors saw the launch of the Euro as a path to deeper political union. With a much bigger vision in mind, those who hurried this process along after the fall of communism and expansion of the European Union from 12 to 27 members overlooked or chose to ignore both the generous entitlements and, worst still, the levels of corruption and tax avoidance that permeate these economies.

In December, Papandreou admitted to other European Union leaders that "systemic corruption" was at the heart of the Greek crisis and said his government intended to take "harsh measures" to root it out.

The Euro has, without contention, created both stability and wealth in Southern Europe. In the past decade citizens have been lulled into believing that a price won't have to be extracted for Europe turning a blind eye to misdeeds. As they take to the streets in protest, they are finding out that the lenient times are drawing to a close.



soundoff (4 Responses)
  1. John Tipu

    Dear John,

    Your comment "enjoy 14 months of pay for 12 months worked" suggests that the Greeks are being overpaid. Maybe your comment should read, enjoy 12 months work and are paid for this in 14 instalments.

    I would have expected a journalist of your caliber to at least do a little more research and dig a little deeper. Quoting the average salary paid in Greece and the equivalent salary for the same work paid in United States Drachmes would not have been too difficult. Use the internet. It's full of statistics. At least tell the average American the price of a hamburger in Athens so that thay may make a reasonable comparison to the cost of his or her hamburger in the US.

    Have a nice lunch.

    Yassas,
    John

    March 5, 2010 at 1:47 pm |
  2. John Tipu

    OMG,

    This is not funny...

    It just keeps repeating itself, only different.

    Sounds like an A-merry-kan lunch.

    March 5, 2010 at 1:48 pm |
  3. John Tipu

    Moderate me... I'm in the mood.

    [;O)

    March 5, 2010 at 1:49 pm |
  4. John Nikas

    Dear John,

    You spoke about the irony of the people in the protest however when you so calmly spoke about the great cup of tea you had with the prime minister, did you ask him about the corrupt devils he is surrounded by? The people of Greece are not stupid. They have been fooled for years. Germany on the other hand controls the money within the European Union (along with France and some other countries have some power). However, why should Germany obtain loans at 2% interest rate and give that same money to Greece and other smaller countries for 4%? It just doesnt make sense. And furthermore, for any German reading this comment (and I hope a German does), lets just say, throughout history, Germany is not innocent in destroying a part of society...to say the least....

    March 22, 2010 at 6:51 pm |

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