Greece, Germany In War Of Words Over Austerity

By Andy Dabilis

When George Karatzaferis, leader of the far Right-Wing LAOS party, spoke before parliament last week on whether Greece would accept the additional austerity measures demanded by international lenders, he invoked an image that terrified those who remember World War II, and infuriates many Greeks today.

“The creditors are asking for 40 years of submission. Greece cannot survive outside the EU, but it can survive without a German boot,” he said.

And while Greece’s partners in the 17-nation eurozone agreed Tuesday (February 21st) on a second bailout of 128 billion euros that may keep Greece from default, the package will likely do little amongst many Greeks who perceive Germany, the biggest contributor in the euro zone for Greece’s bailouts, as their enemy for insisting on waves of pay cuts, tax hikes, slashed pensions and the layoffs of 150,000 public workers over the next three years.

German criticism of Greece has been increasing. Two years ago, the German magazine Focus used an image of the Venus de Milo making an obscene gesture to illustrate an article that described Greeks as crooks.

When Finance Minister Evangelos Venizelos was cross-examined by euro zone officials on flagging Greek reforms in return for bailouts, it was his German counterpart — Wolfgang Schaeuble — who raised the delicate question of whether Greeks could be trusted.

Schaeuble’s conduct was too much for Greek President Karolos Papoulias. “Who is Mr. Schaeuble to insult Greece?” he asked.

Not long before that, Germany suggested that the EU consider putting a budget czar in Greece to oversee the country’s finances, which Greeks took as code to mean a German, further inflaming relations.

Between riots in the streets and pressure from the Troika for more austerity, Greeks are increasingly pointing fingers of their own at Germany.

Dimitris Hatzinikolaou, a professor of economics at the University of Ioannina in northern Greece, said he was among the outraged.

“I don’t want to lose our sovereignty … having a minister from another country won’t help. People in this country will revolt,” he told SETimes.

Greek protesters burned the German flag in front of the parliament during a demonstration earlier this month, which corresponded with lawyers, doctors and the Technical Chamber of Greece calling for a boycott of German products.

Lawyers and engineers are among the closed professional groups the Troika said should be liberalised to allow competition in the industry.

“All that’s left is for the Germans to plant the German flag on the Acropolis,” engineers’ association head Christos Spitzis said.

Tuesday’s eurozone agreement comes at a price. Greece must pass a new law that gives paying off debt priority over funding government services and employees, and must set up a special account managed separately from its primary budget that must have enough money to service its debt. It will also ask banks and investment funds to forgive billions in debt.

The suggestion that foreign debt will be repaid before Greece can pay its own citizens will likely be difficult for many.

Ulrike Drissler, deputy director of the Goethe Institute in Athens, which has more than 1,200 clients studying German and offers a link to German culture for Greeks, said it’s time for the hyperbole to be ratcheted down.

“It’s very much a political thing,” she told SETimes of the sparring. “Things are getting a bit mixed up. We’ve been working in the society with Greek people and they have nothing against us. They like to come to our events and learn the language and I haven’t encountered any hatred towards us,” she added.

Reducing the ire may be difficult. A recent poll found most Germans think Greece should leave the euro zone and blamed Greeks for a lifestyle they said created the crisis.

Bosch CEO Franz Fehrenbach called for Greece to be kicked out of the EU because it is an “unbearable” burden. “This state with its phantom pensioners and rich people that don’t pay taxes, a state without a functioning administration, has no place in the EU,” he told Manager magazine.

George Tzogopoulos, a Senior Research Fellow at the Greek think tank ELIAMEP, told SETimes that Germany should not have raised the idea of a budget overseer. “The reaction is targeted towards Merkel and not Germany as a whole. Greeks were offended by this German idea,” he said.

There are calls for the enmity to subside.

“We must not let the tone get out of hand,” Hermann Groehe, deputy leader of German Chancellor Angela Merkel’s Christian Democrat Party told Reuters.