Greece suffered in 2011. The economy tanked for the fourth year in a row. Unemployment rose to above 20%. The government, up to the gills in debt and cut off from the capital markets, had to go begging to the infamous Troika of EU, ECB, and IMF bureaucrats and elected officials. In return, it had to implement painful reforms—layoffs, wage cuts for the lucky ones, liberalization of coddled markets and professions, deep cuts to the state healthcare system, privatization of state-owned enterprises, new taxes…. reforms it then didn’t implement, or couldn’t implement, or refused to implement. And each time Troika inspectors came to Athens to check on progress and audit the books, they left angry. The Troika would threaten to cut off the bailout funds, and in fact did cut them off for a while, to force Greece to make some progress in getting its economy to be competitive on a global basis.
German taxpayers, who were funding a large part of the bailout, were getting impatient. They’d had seen their own earnings power get whittled away year after year in a sneaking and pernicious manner through a combination of inflation, nearly stagnant nominal wages, and higher taxes—while the Greeks, after joining the euro, had been rewarded with huge wage increases. It was borrowed money, but it was money nevertheless, and it filled their pockets and made many of them rich. And it made Greece uncompetitive with Germany, with Europe, and with the globalized economy.
Then the music stopped. And Greece was suddenly expected to restructure everything at once—an elephantine task for which Germany had taken over a decade. With unemployment skyrocketing, the reforms threatened people’s livelihoods. So they demonstrated, and strikes paralyzed Athens and sometimes parts of the country for days, and violence broke out in the streets, and battles were fought with batons, teargas, and Molotov cocktails, and moments of these horrific absurdities were captured in this awesome and shocking video, Days of Decline:
Let’s hope that these images will remain images of 2011 and not seep into Greece’s future.
Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate “beer money.” I appreciate it immensely. Click on the beer mug to find out how:
Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.