Download Speech given in the parliamentary debate

HELLENIC REPUBLIC
MINISTRY OF INTERIOR
PRESS OFFICE
Athens, December 5 2011
PRESS RELEASE
Speech by the Minister of Interior, Tassos Giannitsis in the
parliamentary debate on the ratification of the bill “Ratification of the
2012 state budget and budgets of special funds and services”
“Ladies and Gentlemen,
On November 11, an unprecedented enormous initiative was taken. A
majority government resigned and a new government, supported by three
parties took office. I have the honor to be a member of this new government.
Such an unprecedented choice involves an important overall message:
unprecedented initiatives can be taken on other issues as well helping us
overcome with patience, perseverance, solidarity and self-awareness, the
crisis experienced by the country. We know that we will go through really
difficult phases for a very long time. However, today is the time to think about
many things over again.
A 2012 budget discussion may be conducted based on numbers, deficits,
taxes, expenses and arguments, or a variety of over-discussed issues. I shall
not follow this rationale. Today, we can not have a discussion on the budget
and the financial policy based exclusively on models of previous discussions,
with references to measures and statistics. I think that the political and
financial choices made in the budget, give answers to two key questions that
preoccupy the thoughts of all citizens: where do we want to go and what do
we have to do.
It is obvious that there are no single political answers to these questions.
However there is one answer nobody can put into question: significant
aspects of the social and economic development model failed and quashed
hundreds of thousands of expectations developed before the crisis. So there
is an obvious need for enormous initiatives that will determine the success in
the game which consists in overcoming the crisis by dealing with the
pathologies that, throughout the decades, have obstructed the development
dynamics of the society.
I will make a brief historical review which may sound strange to you but you
will realize the purpose of it. Over the past 65 years, as a society, we have
been profoundly defeated four times. First, because of the civil war that left
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long term scars. Second, because of the dictatorship which had a decisive
influence on many relationships for much longer than its seven year duration.
Third, because of the tragedy of Cyprus in 1974. Fourth, because of the
economic deadlock and because of the fact that we came close to bankruptcy
and exit from the euro. Having suffered these defeats, I believe that today
there is only one national priority for all of us: to avoid a fifth great historical
defeat that will affect all Greeks, even those in financial distress who feel that
they have nothing to lose. However, they will also have something to lose.
Among other things, they will lose their prospects.
Each of the above four points which ended in deadlock for the nation and the
society leads to a conclusion, puts a big question and demands an answer:
-the conclusion is that our system ends in failure in a high frequency. This is
not accidental. Regardless of the reasons, it relates to the inherent derivatives
of our perceptions and our behaviors. Every now and then there is a deadlock
or a defeat. I agree with the famous dictum according to which in politics there
are no deadlocks. Why? Because ordinary people are asked to pay hard for
failed policies, which lead to deadlock situations. Ordinary people are involved
in huge personal costs which make it possible to overcome a deadlock.
However, these costs could and should be prevented.
-The big question is “why”. Which were the elements that made us so often
lose face on the political, financial and national level. What were the systemic
features of the political, developmental and social post- dictatorship model,
which prepared for the mutation of the flight of Ikaros into Persephone’s
farewell.
One answer: whatever the dynamics that pushed us to all these may be, we
inherently need to protect ourselves from repeating them, because I do not
believe that there is something in our DNA which makes everything we have
lived deterministically inevitable. The question is a simple one: whether we will
keep moving or not with a sense of explosive voluntarism which, after being
cultivated for a very long time, even now makes us believe that the crisis can
be overcome through the same ways, the same perceptions and obsessions
which led to it.
So, to put it clearly I believe that in our society self destructive obsessions
transformed into ideologies. That an entire set of policies supposed to serve
broad social strata, to contribute to the growth and social prosperity, -in order
to be legitimized in the eyes of parts of the society - transformed into
ideologies, while these options have repeatedly turned against both ordinary
people and the country, and created increasing debts that must be paid off.
Let me remind you that ten years ago we refused to provide a more robust
and sustainable insurance system. What was the result? The recently
published data by the Ministry of Finance,
-which I submit- show that
between 2001 and 2011 the cumulative deficit of the insurance funds reached
97 billion euro. 97 billion out of a total accumulated debt of 352 billion euro
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that is 28% of the debt. The national debt could be lower by 28%. This led to a
reduction of pensions by about 28%.
Ordinary people are asking where we are heading for and what Greece will be
like when we get out of the chaos. The short mandate of the government does
not allow unrealistic expectations. However, the government will have done a
lot, in case it lays the foundations for higher competitive abilities and a strong
productive base so that we can have a country that will be able to make use
of modern keys for development, will not be characterized by statism and will
be friendly to the young generations.
In order to reach its goal, the government is focusing on four areas:
First: improving financial and other economic imbalances. This is a
prerequisite for strengthening the dangerously tottered system of production.
The support to be provided by the European system, in the midst of a broader
crisis in the eurozone, depends on our determination to implement the
decisions taken in October.
Second: the government is fighting to ensure our European identity. This has
nothing to do with metaphysical reasons. It is because
the notion of a
European identity encompasses the core values of social democracy, social
balance, social development, quality of life and stability. Moreover, our most
important national interests are highly dependent on our participation in the
European system.
Third: achieving development. Development will be the main measure of
success or failure in our efforts to overcome the crisis. The achievement of
each goal, either in relation to fiscal issues, that is the deficit and debts, or in
relation to unemployment, social pressures, national interests and our national
sovereignty, will depend on the progress in achieving both fiscal balance and
growth. We must simultaneously succeed on both fronts. We should not
waste time with lame attempts, because they will have no effect at all.
However, the prevailing culture makes the development task very demanding
in terms of time, effort, perseverance and consistency. It involves a number
of tensions with various embedded interests and thought patterns, it requires
ongoing consultations with stakeholders, it requires courage. It is well known
that citizens and enterprises are exhausted by complicated and opaque
procedures and bureaucracies, often associated with additional financial
burden, uncertainty and discomfort.
The fourth goal of our policy is the gradual unwinding of the debt and the debt
burden. Thus, there will be degrees of freedom for making important policy
choices. The long -lasting corrosive role of continuous borrowing and debt will
be reversed. Let’s see what has happened. Between 1989 and 1999, 80
billion in GDP growth was achieved while the public debt increased by 95
billion euro. Between 1999 and 2010, 120 billion in GDP growth was
achieved, while the public debt increased by 213 billion euro. The market
mechanisms may have their own responsibilities and reasons for that.
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However, a whole culture, found to need an increase in debt by over 2 euro in
order to produce 1 euro GDP is the product of our own stereotypes for which
we pay a very high price.
One of the most severe criticisms on the policy followed is that the main goal
is to bail out the greedy banks and the bank capital. Let’s give ourselves some
distance from this criticism. I have three observations to make:
1. The capitalization level of banks today is not over 3, 5 - 4.0 billion euro.
However, the bank deposits reach 175 billion euro. They are the savings of
many years and of various social strata. Who will benefit from the support to
the banking system stability? Is it for the benefit of shareholders or of
ordinary Greek citizens and our economy as a whole? Our economy will be
vulnerable to turmoil, if we follow the logic of revenge on a banking system,
which for decades has supported the national economy.
2. The vast majority of the share holders who hold the Greek Banks’ sharecapital are not powerful financiers. They are insurance funds, institutional
investors and a large number of small and medium savers. Who will be
destroyed if the government is indifferent to the fate of banks?
What is the sense of events organized in favor of medium sized
entrepreneurs,
professionals and workers if we remain revengefully
indifferent and we do not protect the savings of ordinary people.
3.How can a policy, which in the medium term will lead to a reduced debt
and reduced leverage by international banks, be also accused of creating a
subordinate society dependent on financial markets. The rationale of the
previous model, which was followed in an easy going way led us to this point.
These are simple questions which however must be answered, before
choosing the right policies. We all know that the globalised financial system
has run away with itself, functioned as a Prometheus released from captivity
and led to painful consequences. We recognize the need for a more effective
global regulatory framework, which, however, involves conflicts of interests
between states and markets and this will take time. We also know that the
banking system must learn from the experiences of the crisis. Until then we
can not stand stubbornly and wait, doing nothing. We must cope with these
situations by making use of all available means.
Ladies and gentlemen,
The Greek crisis had its specificity: it was the first one to come to the fore, as
an exotic example in an environment of seemingly healthy economies. This
perception has changed as other countries such as Ireland and Portugal,
followed as well. We are currently experiencing the extension of the crisis in
the eurozone as a whole. Many mistakes were made in the governance of the
eurozone, both before the crisis and in the practical management of the crisis
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over the last three years. Problems became increasingly complex over the
years and dealing with the crisis involved increasingly high costs.
Now we can see that the crisis began to unfold in other European countries as
well. I believe that Europe is experiencing a transition phase, which will result
either in new forms of cooperation and governance or in the spread of the
crisis with negative effects. The eurozone is experiencing what we are also
experiencing: it is well understood that we can not have a stable and
sustainable big plan for the single currency without important changes in
attitudes, institutions, rules of discipline, the coordination and the overall
planning.
This week proceedings culminate and can lead to a more convincing
mechanism for the governance of the eurozone. The stabilization of the euro
will have positive implications on the stability in our country and on investment
initiatives which remain inactive because of the prevailing atmosphere of
instability and uncertainty. However, we too have our share of responsibility.
Nothing will be achieved unless we make the necessary adjustments to favor
investments, productivity and growth.
Ladies and gentlemen,
People do not expect us to tell them how many sacrifices they have made.
The message is that they realize that many things must be changed, because
if the situation remains unchanged, things will go worse. At the same time
society must be offered prospects for overcoming the crisis. And that is one
thing we want to achieve as a government. We also want to create a solid
foundation for the next government. Let us not keep destroying all hope, it is
not fair.
I believe that if we are consistent with our commitments and systematic in our
efforts, either during the short mandate of the present government or during
the term of the next elected government, we will achieve visible and positive
results. In our difficult journey, there will come a
moment when we will
reverse recession. We have already taken an important initiative in order to
strengthen concertation and cooperation. We have great hopes of overcoming
the crisis and highlighting a different reality.”
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