Greece is entering a new phase of uncertainty.
JENNY BROCKIE: Welcome everybody. We are going to cross to Berlin and London soon but let's first cross to Athens. Euclid Tsakalotos, I'd like to start with you. You were elected to the Greek parliament this month as a member of the radical left coalition, Syriza. You've gone from being a minor group to a possible government for Greece. If you do form government after this next election, the June 17 election, what happens to the Greek bailout agreement?
EUCLID TSAKALOTOS, SYRIZA MP: Well, the first thing to discuss before we get to the economics and what are our negotiating positions is that this is a moment of democracy and discussion of what kind of Europe we want. One of the things we have been saying is it can't be the case that the populations of Europe can vote for any program they want as long as it's the program that the current Minister of Finance of Germany wants us to vote for.
It must be the case that European peoples can vote on alternative programs, on alternative social policies, and that is what we're trying to bring back to Europe. We're trying to bring back to Europe that listens to its people, that listens to its, the problems that people are expressing and if we don't return to Europe, whatever happened to that kind of Europe which is what kind of Europe that Monet and Monet and Schuman and the instigators of Europe wanted to see, a democratic, a social, a just Europe, we are going to have very being problems.
So we don't think it's just a Greek problem. But we do think that we need to change the economic policy, the policies of austerity are not working; Greece and Spain have 20%, over 20% unemployment and 50% unemployment in their young people and the policies of austerity have led to a vicious cycle where we have austerity measures leading to recession and unemployment, leading to calls for greater austerity measures and the Greek people have basically said on 6th May that that has to stop some time and this is as good as time as any.
JENNY BROCKIE: So Euclid, what are you going to do though, are you going to just scrap the austerity measures, I mean if your group forms a majority power in the government, are you just going to scrap the austerity measures, default on the payments? What are you going to do?
EUCLID TSAKALOTOS: What we have said, what we have said is that we will not carry out any measures that hurt the poorest people of the population, that keeps reducing their wages - that keeps cutting their pensions, that makes the labour relations go back to the 19th century. But we have said that we would like to renegotiate something like – and it will be interesting to see what Ralph thinks about this, my German colleague, something like the Germans negotiated after the Second World War.
After the Second World War, Germany had a huge debt, they negotiated a martial plan, they negotiated a haircut and most critically of all, they negotiated that they would only pay their creditors if economic conditions allowed, in years that exports went better or growth was higher, they would pay more back. In years that exports and growth performance was not as good, they would pay less back. We really do not see in Greece why that was good for Germany in 1953 - it's not good for Greece in 2012.
JENNY BROCKIE: Alright Ralph Brinkhaus in Berlin, I want to get a reaction from you to that because you're a member of Angela Merkel's Christian Democratic Union. How do you feel when you hear that from Euclid, who may well be in a very powerful position after this next election?
RALPH BRINKHAUS, GERMAN MP: Yes. This might be a powerful position within Greece, but not in Germany. We have to always keep in mind our electorate in Germany. People don't like to pass such a big amount of money to Greece. At least they want that Greece stick to the way of reforms we have negotiated and renegotiating all the conflicts, all the treaties we made with Greece, we get problems, not only within Greece, but also with the other countries where we also have treaties with, for example, Spain, for example, Portugal, for example, Ireland. And for this reason we have to stick to the ways to reforms we have agreed upon some months ago. This is the first point. The second point, we know very well...
EUCLID TSAKALOTOS: Can I just ask a question...
JENNY BROCKIE: Euclid, just let him finish and then I'll give you an opportunity. Ralph.
RALPH BRINKHAUS: So we know very well that the people in Greece are suffering. There is no question. But we think and we are deeply convinced that the so-called austerity program - I call it efficiency program - is a base for further growth. So without structural reforms in Greece, we will not come to the path of reforms and public growth and for that reason...
JENNY BROCKIE: So Ralph, is there any room to move though on this? I mean, is there any room to move, if you have to face the political reality of Syriza as a possible powerful part of the government, is there any room to move with the bailout agreement?
RALPH BRINKHAUS: No, there is no room to move within the bailout agreement, but there is room to move to organise to create a package of growth, but this has to be a different from the fiscal pact we have agreed - this austerity program. So we have to talk about both. The first point is we have to organise this program of structural reforms, Greece has asked to fulfil and the other hand we have to organise this growth package. But we do not want and we are not in the position to renegotiate the fiscal package austerity program.
JENNY BROCKIE: Can Greece reject the bailout and stay in the euro, in your view -in the Eurozone?
RALPH BRINKHAUS: This is really a difficult question. Nobody, really nobody in Germany wants to push Greece out of the Eurozone. I guess it would be the better solution for Greece and the rest of Europe and for the Eurozone if Greece stays in. So we really hope that the people in Greece will elect a government, will elect a Parliament which will continue the path of reforms and at the end of the day, the path of growth.
JENNY BROCKIE: Euclid, a very quick reaction from you before I go to one of your colleagues.
EUCLID TSAKALOTOS: Well, apart that Ralph didn't answer the question that why something that isn't good for Germany in 1953, isn't good for Greece in 2012... let me remind Ralph of one other moment in German history.
RALPH BRINKHAUS: Okay, can I answer the question.
EUCLID TSAKALOTOS: After the First World War came, Keynes, the great British economist said that if we bring Germany to her knees and don't support her and insist on her paying reparations, we will create unemployment, we will create poverty, and we will create huge problems and that is what happened in Germany. In Germany - was brought to her knees and we had years of recession, unemployment, the rise of fascism. So I'm saying you have two moments of Germany history to think upon: one which is a total failure and led to the destruction of Europe; another that was a success and we are facing the same dilemma now. Are you going to help the peoples of southern Europe, or are you going to back to the inter war period?
RALPH BRINKHAUS: Sorry, I need a chance to answer. Give me just the opportunity to answer.
JENNY BROCKIE: A quick chance to answer, yes.
RALPH BRINKHAUS: So, a quick answer - Germany in 1945. I do not like to compare, because Germany in 1945 was in a complete different situation than Greece is today. So, people in Germany did pay their taxes for example. We had sustainable pension scheme system at this time and we did not have to reform all the areas in society Greece has to do and this is the problem. We are not talking of money at the end of the day, we are talking about structural reforms, we are talking about a business model for Greece and by the way, Germany in the 50s had a business model, Greece has no business model. So we have to talk very frankly and friendly with solidarity about the business model.
EUCLID TSAKALOTOS: And had a lot of help from the rest of the world. Even though they lost the war there was a lot of help for Germany.
JENNY BROCKIE: All right, all right, I think we've talked about history I want to get on to the contemporary situation now. George Papaconstantinou, you are a politician and you were the Finance Minister in the previous Greek Government. You drafted and negotiated the first bailout agreement. You said that if Greece reneges on that deal it would open the door to hell. What do you mean?
GEORGE PAPACONSTANTINOU, FORMER FINANCE MINISTER: Well, I mean the following: first of all, it's clear that the elections produced a result that we all need to take into consideration as we move forward, there's no question about that. We all want a better Europe, we all want a more fair Europe. We all understand that Greece's problems are also a systemic issue for the whole of the Eurozone, however, a country that consistently spends more than it earns, borrows the difference and then uses it to buy imports is not...
JENNY BROCKIE: Okay, we're losing a bit of sound here. Can we get that sound back? Yes, we're hearing you now. If you could just repeat what you said then, sorry the line just dropped out.
GEORGE PAPACONSTANTINOU: I said, I don't know where you lost me.
JENNY BROCKIE: You were talking - I was asking, well, I was asking you about what you meant when you said it would open the door to hell and you were giving an answer about what it would mean if Greece reneges on this deal?
GEORGE PAPACONSTANTINOU: I said that the country would consist...
JENNY BROCKIE: I think we will have to try to sort out that line and get back to George in a moment. Sorry about that, George - If you can hear me? Costas Lapavitsas in London, you're an economist, now you are opposed to the austerity program for Greece. Can Greece reject the bailout – the current bailout and stay in the euro?
COSTAS LAPAVITAS, ECONOMIST: I would say that Greece has no option but to reject the current bailout agreement and Greece has no option but to stop servicing this impossible debt – I think we have to start on that. If Germany and other core countries understand this and are prepared to accede to it, that's all very well and good. If they don't then Greece must get on with it and deliver these results because Greece cannot survive otherwise. Greece is dying on its feet.
You might ask me, will this mean that Greece will exit the Eurozone? I would answer you that yes, it probably will mean that. That's not necessarily a bad thing in my view. In fact, it might be the way to solve the problem, once for all. And can I also say, this isn't just a Greek problem at this stage, this is fast becoming a problem for the whole of the Eurozone. We keep talking about it as a Greek issue and actually Spain is next in line, Portugal is not far off and Ireland cannot deal with its own debt either. There's a bankruptcy emerging in Europe at the moment and it is important that people realise that the Eurozone is probably unsustainable as it stands. So irrespective of Greece the answer is fairly clear it seems to me.
JENNY BROCKIE: So you think that Greece should reject the bailout and leave the euro?
COSTAS LAPAVITAS: I think that Greece has got no option but to reject the bailout. If it doesn't reject the bailout, Greece is finished. We will see in practice whether Greece will have to leave the euro. People say that it won't, my view is that it will, but we will find out.
JENNY BROCKIE: George Papaconstantinou, I will try again to talk to you, I understand that line has been fixed. Could you hear what Costas was saying about how he doesn't think there is any option but for Greece to reject this bailout and possibly leave the euro?
GEORGE PAPACONSTANTINOU: Yes, I did hear what he said. I think that people who say that Greece is better off leaving the euro are way off - this would lead to a huge recession, 10-20 per cent further than today; inflation of the order of 50%, a huge drop in living standards. It would be going back to the 50s and the 60s. We've gone a long way in the last 20 years. Unfortunately we did not make all the necessary changes and adjustments when we had to, because a country which consistently spends more than it earns, borrows the difference and then uses it to buy imports is not a viable proposition in the Eurozone. We need to reform.
We need to get our fiscal house in order. We need to make all the structure changes. I hear Syriza talking very little about the structural changes which are necessary - opening up markets becoming more competitive - we all want a fairer Europe, we all want a better Europe, we all want a social state, but you must have the money to be able to do this. So as we move forward there is no other option than to stay within the agreement, improve it where we can, and I think there is room for improvement because the pace of fiscal reconciliation, every economist will tell you it's way too harsh, it's too much in too little time and we can do better than that, but certainly within the agreement. If we unilaterally repudiate the agreement, or if we unilaterally decide to write off our national debt, then Greece will be an international pariah - we will be out of the markets, we will be cut off from the rest of the world, we will not have the money to be able to buy fuel, medicines and that's not the future that I want for my country and it is a real shame that Syriza is not telling the truth to the Greek people. It is one thing to say let’s improve on the existing agreement
JENNY BROCKIE: But haven't the voters.... But haven't the voters George roundly rejected what you proposed and haven't they roundly rejected the major parties, the voters of Greece have said they don't want austerity, they don't want the agreement, they don’t want that part of the agreement.
GEORGE PAPACONSTANTINOU: Let's remember that Syriza did not get 51% in the elections, Syriza got 17%. They are behaving as if they have an absolute majority, and they can rule, which is not the case.
JENNY BROCKIE: But they had a huge increase in their vote.
GEORGE PAPACONSTANTINOU: The read the results with a lot of caution, absolutely, and we have a huge collapse at the same time. But let's read the results with a lot of caution. What did the Greek people say? If you ask anyone, all the polls suggest that eight out of ten Greeks want to stay within the euro. Eight out of ten Greeks, at the same time it seems the majority of Greeks does not like this particular agreement. Now, somehow we need to put those two together, but it's not by telling people that you can stay within the euro and throw out the agreement altogether, because this simply doesn't work. Greeks have said very clearly, let's all get together, because coalitions, agreements, are the way to go, and that's a very powerful message that they have sent us.
JENNY BROCKIE: I'd like some reaction from the room now. You've listened to all those points of view. What do you think? Yes?
MAN: More debt doesn't solve a debt problem. We need to be able to create a situation and environment which actually solves the financial problem that Greece is in. It's a bigger problem; it's worldwide problem, it's not just a Greek problem. We're seeing it touch Greece. I totally agree with Costas and what he is saying, I totally agree that Syriza's increase in voting means the people are rejecting the other parties because they cannot solve the problem.
JENNY BROCKIE: But where does that leave you in terms of what happens next. If you exist the euro what happens to Greece next?
MAN: It could probably solve the problem. It's a paradigm shift and you need to do a whole paradigm shift to be able to get Greece out of this problem.
JENNY BROCKIE: Panayoitis, what do you think?
PANAYIOTIS DIAMADIS: It goes back for me to leave the euro in as is known as - a disorderly exit -would be like going back to the 1920s after the Greek genocide when we had a million-and-a-half refugees flooding into a country of five million. You want to see a crisis, you want to see poverty? You want to see death in the streets - You go and look at the photos and film that Australians were taking in the 1920s in Athens. This is nothing compared to that. If we leave the euro, we're going back to that.
JENNY BROCKIE: Okay, so where does that leave you though? Does it mean accepting the bailout as it exists – the bailout agreement?
PANAYIOTIS DIAMADIS: In a few weeks we have to, until we get some sort of stable government in the country, then we can talk about... go back to Brussels and say we want to, as a group, as a people, as a country, stay in the euro, but we need to renegotiate the deal. You don't negotiate deals by tearing up the pieces of paper.
JENNY BROCKIE: Eleni, what do you think?
ELENI PITSILIONI-ALEXIOU: We have clear evidence that the people of Greece are suffering under the austerity measures. I don't think that what the big people have tried, have implemented has worked. Therefore I think we should try a different way. I agree with Mr Lapavitas, I agree that we should try alternatives. I agree that the way the financial crisis is affecting the average Greek is horrible and as a Greek and as a human being, I believe that we should find that different way out of the situation.
JENNY BROCKIE: Jost, you've been listening to this, you were a shadow minister for the economy in Germany in the 1990s for the Social Democrats and you live in Australia with your Greek wife, which is interesting. I just wonder if you think Greece can stay in the Eurozone?
JOST STOLLMANN: Well, let me first say that I'm perplexed at how wrongly we put the question, because it seems as if there was a decision whether we could be for or against austerity. Now, I think we can quickly agree that the Greeks have lived beyond their means. They don't have the efficiency and productivity to support their lifestyle and they have been blessed with irresponsible lending, so we are all in it together. But the financial markets don't provide the funding any more. That is the brutal reality.
So the question that is put to the cradle of democracy, the Greeks, is when it is about this brutal adjustment of the living standards to the reality, the economic reality of the country, would they rather entrust - and now we are talking trust - would we trust it to a group of protest movements that sent a few media stars around the world, and they will then come to Berlin and to Brussels and say, "Oh we have great different ideas on how we are fixing this." Merkel and Mr Draghi will say, thank you very much, you are out. Then the gentleman, the new rock stars, can manage a currency breakup, without bankrupt run, without capital flight, without default, without this and that, and let's assume the gentleman of London is right and we get a wonderful devalued Drachma, then this proven team will have to make sure that Greece actually will execute the structural reforms and gain the competitivity and refrain from printing money and in a hyper- inflation... have chaos, violence.
JENNY BROCKIE: Okay, I think you've made your point and painted the picture. Hold those thoughts everyone. I know you want to respond to that.
Jost, you were painting a picture of what you thought life might be like for Greeks under Syriza, if Syriza got into government and you refer to them as rock stars, media stars and talked about a devaluation of the Drachma and dire consequences.
I just want to give Euclid an opportunity to respond to that. Euclid, that's a pretty damning picture that has been painted here about just what it would mean if you went ahead with what you're saying, that in fact it would lead Greece down an even worse path than it's going down now?
EUCLID TSAKALOTOS: We heard something about the smugness of the elite and why Europe is in such dire Straits... The elites in Europe have come used to have their way that rich people must be richer so they have incentives - the poor people must become poorer to have incentives. Now about the rock stars - on any day of any week, you can read an article in the New York Times, in the Financial Times, in the Economist, that the euro is under danger, is under threat, not because of Greek politicians and Greek people who want to find a different way, but because the Eurozone has not got a financial and economic architecture to deal with the crisis. And it's under threat because of the policies of austerities.
I will remind the previous speaker that for all his comments about Greeks who are spendthrift, the German banks made a huge amount of money lending to us. German export companies made a huge amount of money exporting to us and unless the German people understand that, unless they understand that we're all in this together, the euro will collapse and then we will return to the deutschmark which will be over-valued and will hit their export industry. So what we say is it's time to get rid of smugness, to get rid of elite arrogance and try to bring back politics. And politics means the confrontation on different values, on different programs, on different social priorities and quite frankly, if we do not get that, we will be returning to very poor circumstances and as a German he should know that we do not want to return to that.
One last point about Costas Lapavitas and the exit -the Greek people and Syriza don't want an exit from euro because we do not want to return to the competitive devaluations and the nationalism of the 1930s. German policy at the moment is driving nationalism and we really must find another way.
JENNY BROCKIE: Alright, George, I want a response from you to that because you have been roundly rejected by the voters of Greece. When you hear the comments that Euclid is making, what's your response? It's obviously appealing to people. It's appealing to people in this room.
GEORGE PAPACONSTANTINOU: Well, of course it is, because Greece is in a very difficult spot, because people have seen their wages being cut, because people have seen their living standards fall, so anyone who comes out and says, "I’m going to fix this and it will be painless, no problem, I will repudiate my debt, I will renegotiate the agreement, I will tear up the agreement and give you another one, but they will continue to fund us", it sounds great, but unfortunately it is also not true. And speaking of arrogance, how arrogant is it for a Greek leader to go to Paris, to our biggest ally at the moment, with the newly-elected French President and insult him? How arrogant is that? Thinking that having gotten 17% of the Greek vote, you express the whole of the Greek people, you do not, you express 17% of the Greek people, of course you express the frustration, the anger and all of this there is no question about that.
EUCLID TSAKALOTOS: All of that is incorrect. That is just... That is just cheap politics.
JENNY BROCKIE: I'm going to stop you at this point because I want to go now to a sounding we took a few days ago on the streets of Athens about who Greeks think is responsible for the current crisis. Have a listen to this.
The Greek People Speak:
REPORTER (Translation): Who do you blame for the current problems?
MAN (Translation): The political system and the people.
WOMAN (Translation): All 300 MPs, but the two major parties are at the top of the list. But all 300 MPs bear responsibility for what has happened. They all knew and they all covered up.
REPORTER (Translation): Have the austerity measures made you change your vote?
MAN 2 (Translation): Yes. Personally, my vote was a reaction – I did not vote the way I would have liked. I wanted to send a message to the politicians, that they are going the wrong way.
REPORTER (Translation): How will Greece get out of this crisis?
WOMAN 2 (Translation): Only if all these bums in the parliament, the whole lot, are thrown out.
MAN 3 (Translation): The problem is a political decision, a political problem. The leaders must be pushed and the people should not be fooled.
WOMAN 3 (Translation): It will be very difficult for Greece to get out of this chaos. We need someone honest with nous, because all these politicians don’t know what they are doing.
JENNY BROCKIE: That's a very grim picture being painted by your, you know, countrymen, your relatives, people in Greece and that was very much the feeling we got from talking to people, that they pretty much don't trust anyone. I mean, Panayoitis, if you were over there now voting, who would you trust to get Greece out of the mess?
PANAYIOTIS DIAMADIS: Trust none of them. But the reality is I would have to vote for someone. Personally I would vote New Democracy for the sake of a stable government. I don't like it.
JENNY BROCKIE: This is the Conservatives in Greece?
PANAYIOTIS DIAMADIS: It's the centre-right. It's the only group that would form a Coalition stable enough to give us some state of stable government for the next few years that we need.
JENNY BROCKIE: What about Syriza?
PANAYIOTIS DIAMADIS: I think they're dangerous, personally.
JENNY BROCKIE: Why?
PANAYIOTIS DIAMADIS: They're great on the slogans and no substance. I don't see a policy, a party agenda that is workable.
JENNY BROCKIE: What about the rest of you? If you were voting, who would you vote for?
MAN 2: If we follow the Ralph strategy, there is no doubt the operation would succeed, but the patient would die. The gentleman over here was correct when he said the debt is not serviceable and therefore it's not repayable.
JENNY BROCKIE: Where does that leave you though?
MAN:Where it leaves us is that Germany at the helm of Europe needs to do things for Greece to enable Greece to get out of this. I will give you one example: if Germany stepped in and stepped on Turkey's toes and said, "Back off from the Aegean, allow the Greeks to develop their oil reserves, allow them to do this without Turkey constantly badgering them", we might have another source of income for not only for Greece, but for Europe.
JENNY BROCKIE: That's not going to solve the immediate crisis, is it? Even if that were to happen...
MAN 2: Let me continue from there. If Europe was able to stand and guarantee Greece’s territorial boundaries, then automatically Greece would be able to cut back significantly on its arms purchases which, low and behold, have been coming predominantly from Germany and France.
JENNY BROCKIE: Who would you vote for though, you've just moved back to Australia from Greece, yes?
MAN 2: No, no, I was born here, lived here.
JENNY BROCKIE: Sorry, so who would you vote for, though?
MAN 2: Look, the reality is we have to drag a new democracy back to their original stance when they were against the austerity package as it was originally formulated. And, but we need them to be speaking more so the language of Syriza at this point in time, because Syriza is correct - Germany and the rest of Europe needs to come to grips with what is a general problem, not a local problem.
JENNY BROCKIE: I got mixed up with Nick here. Sorry Nick, you're the one that just moved back to Australia from Greece. Who do you trust, who would you vote for in this election?
NICK KAGELARIS: Well, I really think that this situation was created by the two major parties in Greece. I'm talking about PASOK, mainly, and the New Democracy. Unfortunately I was a voter for both of these parties in the past, but if I was back in Greece right now, I wouldn't vote for them...
JENNY BROCKIE: So who would you vote for?
NICK KAGELARIS: We need some fresh ideas. Some new faces in the Parliament House and we need, we definitely need new idea in order to deal with this situation. The situation is really bad back in Greece. People, they commit suicide - more than 2,000 people have committed suicide during the last two years. So we must seriously think that okay, austerity - is nice to say austerity, but behind this word, it's human lives.
JENNY BROCKIE: You run an IT business, a software business in Athens, which closed last month. Why did it close down? Why did you close it down?
NICK KAGELARIS: It was impossible to do business in Athens. You can imagine that no-one is willing to pay money for IT projects anymore.
JENNY BROCKIE: Did you over-borrow for that business, were you in debt?
NICK KAGELARIS: Not really. I just closed my business because I felt that there is no future in Greece and I moved back to Sydney and I was here a long time ago, and I was born actually here in Sydney. So I said that my future belongs to Australia, and I'm willing to do the best I can in order to find a job and continue my life here.
JENNY BROCKIE: And this anti-austerity feeling, I mean, can you understand why from the outside people would look at say well why reward Greece for being profligate, why reward Greece for not collecting taxes, for not doing the things that it should have done to be more economically responsible?
NICK KAGELARIS: If I can continue for just a few seconds. There is a picture that the Greeks don't like to go to work and they like to go to the beaches and have drinks and coffees. This is not the truth. This is not the right picture. Greeks work very, very hard. The majority of the population there, they work very hard and...
JENNY BROCKIE: Panayiotis, do you agree with that?
PANAYIOTIS DIAMADIS: They are very hard working. I used to live in Greece as well. Like, Nick, I was born in Australia, moved to Greece, I didn't spend anywhere near as much time there, but live in Greece for a time. They do work hard.
JENNY BROCKIE: What about my point about rewarding bad, bad government, bad management. Why even think about forgiving those debts, why not ask for austerity and the cut backs?
PANAYIOTIS DIAMADIS: Because it's the only way out of the euro crisis essentially.
MAN 2: There's a very easy answer to that one. When banks lend, they should be conducting due diligence. German banks, French banks did not conduct due diligence. As a result they gave the money over and even the EU subsidies that were given over with no control, they were given over for specific projects. Instead of a 6-lane highway, we were ending up with a 3-lane highway.
JENNY BROCKIE: The lady up the back wanted to say something, yeah?
WOMAN: Syriza was voted in on the basis of anti-austerity measures. They were also voted in on quite a clear platform that they were to stay in the euro, not out of the euro. So it's pretty clear that there are some economists, like Joseph Stiglitz, the Nobel Prize winner of 2001, who studied the inefficiency of markets and Robert Schiller, who said, yes, austerity measures have their place, but you use them in times of boom, not at times when the economy is waning. We need a restructuring in Greece; we have had the dynasties of the Papandreous and the Karamanis, and the country is now in this position. The people essentially voted anti-memorandum, anti-the nemonial.
JENNY BROCKIE: But you are saying they also voted to stay in the euro. I'm wondering if you can do both?
WOMAN: It can be renegotiated, should be negotiated, Greece is now historically entering something similar to the Weimar period of Germany and I hope our friends haven't forgotten that.
JOST STOLLMANN: I want to talk to this, because I hear more and more of Weimar. And Weimar was not funny for the people in the street and it's not funny for the Greeks. This is very hard. And Weimar the first German democracy, was working its way out of its austerity programs. It needed to continue, keep course, and what happened, populist appeared, on the left and on the right. No clue, but promises and lots of empathy. First it went to the left and then it went to the right. What we need...
JENNY BROCKIE: Do you think this situation is similar to that?
JOST STOLLMANN: Absolutely. We need Greek Democrats, Greek leaders who speak straight to the Greeks and it is critical that on 17th June the right question is put to them, which is, "Do I trust and will I trust the movement, the new movement and become an independent proud Balkan state, or am I trusting the Papaconstantinous of this world and move Greece together through the restructure program. I'm the first one that says this is irresponsible lending so never will the banks get their money back, never will the EC get their money back. This is all hallucination on their part, as much as this movement is suffering from hallucination. So the important only thing is whether Greece can create this business model, I think it was called, where they can start to compete again. There are lots of great Greeks, they are well educated.
JENNY BROCKIE: One of them is your wife, I'm just wondering what she thinks about all this?
JOST STOLLMANN: This huge global presence, why can Turkey be so successful, why can't Greece be so successful.
JENNY BROCKIE: Fiona, what do you think of all this?
FIONA STOLLMANN: Thank you very much for giving me the word. I listened carefully to what the people you ask in the street said and sometimes I must reflect and say, why do Greeks always put the blame on others? I did not hear one person say what they can do themselves. I understand and I have a huge empathy for friends of ours who are in trouble in Greece, for, big amount of people who are losing their jobs. I wish that people would see this as an opportunity. I want to hear a voice that says, let's put our arms up and let's work for a better Greece, all of us.
JENNY BROCKIE: So who would you vote for, Fiona, in the coming election?
FIONA STOLLMANN: For the coalition that would give me the hope this country can remain in the euro, I believe that Greece must stay in the euro.
JENNY BROCKIE: Who do you think that coalition is?
FIONA STOLLMANN: At the moment I hope that in the 17th of June the parties will manage to put a coalition together for the euro, because it is a memorandum.
JENNY BROCKIE: Euclid, a response from you, to what Jost was saying about populism. That really there's a danger here, that you're mouthing slogans but you are not actually proposing structures, you are not proposing details of what you want to do.
I think Euclid, we're having trouble hearing you, we've got a real problem with the sound coming from Greece. That's obviously something that's not working very well over there at the moment.
MAN 3: We're talking here in terms of nationalism which really clouds the argument. Ordinary Greeks really had very little to do with this crisis. It was the elites in Germany and the political and economic elites in Greece who co-operated together to get massive loans into private equity, to build this infrastructure. The money was siphoned off, the people never saw most of the infrastructure which was much diminished and now they're being told that their wages need to be reduced. They won't get their pensions, their superannuation, and I think the word "smugness", the smugness of these elites now, who say stick with us, we provide stability, we have the road forward, when they have caused the problem.
JENNY BROCKIE: George, can I get a response from you to that and do you think the austerity measures that you oversaw as Finance Minister were too hard?
GEORGE PAPACONSTANTINOU: Can we have a bit of a reality check here – yes the Greek debt is very high, we have had the biggest debt in world history. 100 billion off future generations and despite all the very heavy, very harsh austerity measures which were unavoidable, in a month's time, the Greek state runs out of cash, the Greek state will not be able to pay pensions and salaries. Can we please focus on that! How sustainable is a public sector where public sector employees were paid twice that what the same job is in the private sector? How sustainable was a pension system where people would retire at fifty? How sustainable is a system whereby you have loads of people being put in the public sector and not just by the two biggest parties, because I keep hearing the two parties, everybody was in this.
I didn't hear any smaller party ever being against an additional measure of including more people in the public sector. I did not hear them be against any kind of extension of benefits, even if they were going to the wrong side. We need the revolution in Greece yes, but it's a different revolution from what we heard from in Syriza, we need a revolution of common sense. We cannot have a state that operates like this. We cannot have a private sector which doesn't take its obligation seriously, and we cannot have people not paying their taxes and I'm sorry, this is the vast majority of the population which is somehow evading their taxes.
So nobody is outside this, nobody is innocent to the crime. Of course politicians bear the biggest burden, and of course they will be punished for this, as they are being punished, but let's understand that this is a mentality change, we need a regime shift, but one that is based on Greece staying in the euro and Greece being true to its obligations. Let's renegotiate what we can, but if we go the way the radical parties are suggesting we will find ourselves back in the fifties.
JENNY BROCKIE: But George, can you understand why the public do not trust you to be able to do that, given there is this mess and that the major parties were in power. When you say Greece somehow wasn't able to collect its taxes, isn’t that a political problem, isn’t that the problem of the government that you haven't been able to collect those taxes?
GEORGE PAPACONSTANTINOU: Of course it is. Of course it is. And the message of the elections was very clear. It was - we need coalition. But okay, let's forget the two major parties. Who do we trust exactly? Do we trust the extreme, the Nazi party that came in Parliament for the first time? This is the result of these elections - we trust the Nationalist extreme right-wing, that somehow thinks that you can throw everything out and money will keep flowing in? Or we trust Syriza, which keeps pretending to people that don't worry, you know, the money will continue to come, because, you know, they owe us, somehow the rest of Europe owes us and they will continue to give us money.
I also heard one of the people in the audience saying, you know, Greece should be allowed to exploit its natural reserves. Yes, after 15 years the past awful government, quote unquote, for the first time started exploiting natural reserves in the south of Crete. So there is change in Greece, but it's got to be change that will continue, so if you don't like this political personnel, change it. But elect people who are rational.
JENNY BROCKIE: Tonight: we are talking about Greece and the financial crisis that is already affecting the rest of the world. Let's have a look now at how Germans are reacting to helping bail out Greece.
The German People Speak:
MAN (Translation): We have paid vast sums already, who knows if we will ever get it back? I think it is a bit fishy!
MAN 2 (Translation): We have helped enough already, they have to help themselves and get themselves out of the pit. If they don’t make it themselves, Europe can’t do it for them.
WOMAN (Translation): I think people should show more solidarity, as they are the ones who will ultimately benefit. So I am not prepared to give up the idea of Europe and the euro.
WOMAN 2 (Translation): We must give them a chance, even if we wonder what will happen to the 70 billion that is being pumped into the banks. I hope there really is a way for Greece to stay in the EU, but their government will have to take firmer action or there will be radicalisation and there will be a left-wing government or something.
WOMAN 3 (Translation): It’s a bottomless pit if we put even more money in, I think the best thing is for Greece to leave.
JENNY BROCKIE: Ralph, how are you going to juggle the future of Greece and the rest of Europe with the rising frustration of your voters domestically?
RALPH BRINKHAUS: The discussion, in the studio with the audience and I'm very happy that people in Germany cannot follow to it because people in Germany are really fed up to be blamed for all the things happening in Greece. So I'm really missing in this whole discussion the propositions of the Greek politicians saying okay, we are responsible, we have to change our attitudes, we have to change the way we govern and just to clarify some things: Germany is helping Greece.
So we are about with an amount of about $500 billion US, we have for the saving of the Eurozone. We have lost in the last weeks more than $15 billion US dollars, directly through the state-owned banks in the writing down of Greek debts and so the situation in Germany is not very easy, because we have to explain it to our voters. And just by the way, there was somebody claiming that the elites in Germany are doing a bad job. The elites in Germany are still sticking to Europe, are still sticking to the idea not to push out Greece out of the Eurozone, are still sticking to the idea that we need a common political union and sticking to the idea that we have to pay a lot of money to help Greek.
Whereas we are in a situation where we have austerity programs in Germany, too, so within the last ten years we had a lot of austerity programs, and so just to mention it by the way, by the way, the wages in Germany did not rise in the same way as in Greece. We had a lot of problems with our counties, with our towns, not having money. We are closing schools. We have not enough investment in infrastructure. And in this situation I have to explain to the people on the street, in my constituency, okay, we have to pass the money to Greece and, sorry that I have to say it, and the Greeks are not very thankful.
So passing money is the reaction, on the street and from many politicians, okay Germany is responsibility and we want to have more money and giving, no, giving absolutely no idea and I can repeat it, what will be the business model of Greece in the future. This is really a problem and what we need, we really like to have - just one sentence - what we need is the support of the people on the street in Greece electing a government that will go with us the way of reforms because this we need to convince our people in Germany to stick to the path of the fiscal pact of growth and of things like that.
JENNY BROCKIE: Euclid, how much responsibility will Syriza bear if you do win government, if Greece is forced out of the Eurozone?
EUCLID TSAKALOTOS: Well, we think we can negotiate and stay in the Eurozone. We think that there is no law of economics, and no law of social science that says that Europe always has to be the Europe of the rich and to the bankers. Three years after the world crisis has broken out, the European elites have not replied how they will regulate the banks, they have no replied how they will deal with social inequality, or how they will deal with regional inequality. It's a fact of monetary union, that if only the deficit countries adjust and not the surplus country, that monetary union isn't viable and one point about Ralph and our lack of gratefulness, the Germans have been making huge profits from the loans they have given to Germany. There have been no handouts... And one final point...
RALPH BRINKHAUS: Ask yourself...
JENNY BROCKIE: Let him finish Ralph.
EUCLID TSAKALOTOS: One crucial aspect: you should read... you should watch German documentaries more carefully. One crucial aspect is this - the Greek people have no enemy, the German people, we have not said the German people are our enemies. We have said the workers, the labour, the poor, can do much better in Germany, in Spain in Italy. There is no reason why there should be an unequal, an unjust and undemocratic Europe, there must be a way. There is no law that says that things cannot change radically.
JENNY BROCKIE: George, can I ask you, how much is this all staving off what might be the inevitable that Greece will end up out of the Eurozone no matter what?
GEORGE PAPACONSTANTINOU: I really do not want to accept that outcome. I think that everyone will do everything that is necessary to avoid that outcome. There is no question that the hardship is huge on the Greek people, there is no question that Europe needs to adapt and I think that the election we've seen in France is a first sign in that direction. But we need to work within that Europe, within its mechanism, to try to improve it. On that element, I think that nobody will disagree with the fact that we need a more fair Europe, we need a better deal for the citizens, and a deal which is not as good for the bankers. However, this is different from tearing up the agreement, repudiating our debts and then going on our own merry way back to the 70s and the 60s. I think no-one would really want that. But you know, there is a real danger that we may find ourselves there, if we don't, if we're not careful.
JENNY BROCKIE: Would you like to renegotiate the agreement, would you like to renegotiate the agreement yourself? Would PASKO like to do that?
GEORGE PAPACONSTANTINOU: We have clearly said we want certain changes to agreement, including a longer period for the fiscal adjustment. Every economist will take you that the adjustment was too short a period and too harsh. There's no question about it, we knew it from the very beginning.
EUCLID TSAKALOTOS: Why did you say didn't you say that when you were in power, when you were Finance Minister. You could have said those things then. You didn't, you adopted the whole rhetoric and agenda of our creditors, and you have actually said that the creditors' agenda now. We have heard from you today the whole agenda and the whole rhetoric of our creditors. You have not said one thing to convince people that you have got a different agenda.
GEORGE PAPACONSTANTINOU: You were not listening.
JENNY BROCKIE: I'm going to stop you there. You've made your point. George, if you could just quickly finish, we're running out of time, I'd like to get some comments from the audience, too.
GEORGE PAPACONSTANTINOU: The difficulty when you're in government, is that you're negotiating in specific circumstances with succinct Conservative Governments against you, the luxury of the opposition is that you can say things which you then have to change when you're in government. This is unfortunately what Syriza is doing at the moment.
We have got the best deal possible and the fact that we kept improving it, we reduced interest rate on the debt to less than 3%, we extended the time from five years to over 20 years, we shaved over $100 million off the Greek debt and we started making the big structural changes the Greek economy was so desperate for. Let's not throw all of this out.
JENNY BROCKIE: Okay, we are out of time. I just want a quick show of hands here. How many people want to stay in the euro? And how many people want to get out? All right, so the vast majority of you do want to stay. Panayoitis, what do you think the next little while will hold and who do you think will win the election?
PANAYIOTIS DIAMADIS: I do think New Democracy will form some sort of coalition that will get us through the next difficult phase. We do need to implement - something. And like Jost said before, it’s difficult that I have to agree with him, but I do, it is a matter of trust now. Neither the Greek people, nor Europe, trust the Greek politicians. So they have to earn both of the trusts.
JENNY BROCKIE: We have to leave it there, I'm really sorry everyone, we're out of time. You can keep talking on line -jump online, I'm sure a lot of people will want to talk about this. Go to our website to Twitter or Insight's Facebook page. Thank you.