/ Greece / budget / imaginary /
Well, it's not as if this was unexpected... Kathimerini is right in claiming that "...ever since 1997" they have "...repeatedly drawn attention to the governments falsification of budget data..." Even my humbleness would have been willing to bet good money that the miraculous numbers that the Greek economy was achieving were in large part fictitious. PASOK has chosen to attack rather than accept the blame:
We were insistent from the start of the governments tenure that a non-transparent audit would result in the defamation of our country, said PASOK leader George Papandreou. Christodoulakis claimed the government was rewriting history in order to cover up its lack of policies, while Papantoniou said the audit had been conducted in secret, in the corridors of government. He also claimed that PASOK had an understanding with Eurostat as to how to incorporate military spending into the government accounts.
Yet the EU denies such an arrangement:
European Monetary Affairs Commissioner Joaquin Almunia denied Friday that Greece's previous socialist government had an arrangement with the EU's statistics arm Eurostat on how to calculate the country's public deficit.
Asked by private radio station Flash if such an accord existed, Almunia said: "No. Statistical information is not a question of negotiations but of substantiated data". The remarks were a translation into Greek.
...but this is certainly not the whole story... I find it hard to believe that the Commission was surprised by the discrepancies:
...Doubts over the reliability of Greek economic figures are not new and were not provoked by the government's audit, said Alogoskoufis, who claimed the IMF and Eurostat had expressed concern over Greece's official returns in the past. «There was a huge discrepancy, creating a lot of suspicion from everybody, which undermined the trustworthiness of the country,» said Alogoskoufis.
On Saturday, European Central Bank Vice President Lucas Papademos, former governor of the Bank of Greece, said the revisions should have come as no surprise as the figures were in Greek central bank reports and known to Eurostat...[emphasis mine]
Apart from PASOK's fraud and the blatant hypocrisy, there is a real issue here, concerning both the military and the Olympic expenditures (if I hear any more gloating about "our successful Olympics" I swear I'll kill a pundit or two!)
In terms of military expenditure Greece is up there above Lebanon, Pakistan and the DR of Congo! (and they're not counting various "black" budget expenses and allocations to other ministries for military-related expenses...) Frankly, whether the current détente with Turkey persists or not, the EU can't really hinder military expenditures. I am well aware that many in Europe consider that Greece is under no external threat whatsoever, I tend to agree, but I would advise all of them to spend a few months on the island of Lesvos and see the nice Turkish fighter planes roaring directly overhead. Given the fact that the military elite, which is still playing a major role in governing our heavily armed Eastern neighbour, harbours a rather expansionist mentality (something that might change with Erdogan - let's see), the only way that Greece can accept the indirect limitation of its right to self-defense is if the EU guarantees its current legal borders. In that case I would be willing to participate in all kinds of civil unrest in order to disband the Greek army and turn swords to ploughshares...
So, yes Papantoniou is probably talking nonsense, but this is a real and non-trivial issue for the time being.
...And don't even get me started on the discussion of what exactly the deficit and debt caps achieve... (quick and fast answer: among other things it's a tool for the dismantling of the European welfare state and the Americanization of European economies - and thus societies... Well, Northern European societies... over here we have a mixed economical model, part Russian oligarch-type capitalism with widespread corruption and part selectively unregulated market economy, with a heavy dose of the most inefficient public sector imaginable). And, as a thought-experiment, imagine the US economy burdened by anything as restrictive as our growth and stability pact: imagine its growth rate...