Monday 17 March 2008

Volunteers Clean the Beach and Forest of Schinias

Athens, 17 March 2008
Philip Ammerman
pga@navigator-consulting.com
www.schinias-friends.org

On Sunday, March 16th, in a rare example of public, private and civil society cooperation, some 150 volunteers gathered to clean the beach and forest of Schinias. Under a bright, wind-swept sky, the group managed to clear an area of about 200 m x 100 m, or about 20 stremmata of forest. Although this is a small part of the total area of Schinias, it was a strong start to what many will hope will be an ongoing effort.

The volunteers were all ages and nationalities: Greeks, Americans, French, British, Australians, Dutch, Belgians, Canadians, Brazilians, Israelis, Palestinians, Chinese, Moldovans, Serbians, Koreans and Germans all participated. All shared one common goal: to clean and remove as much garbage as possible, restoring the forest and beach to its native state.

The clean-up initiative was launched by NAVIGATOR Consulting Group Ltd., and co-organised by Athenes Accueil; the Foreigners Club of Nea Makri, Marathon, Rafina and Northeast Attica; the Hellenic-American Democratic Association (HELADA); MIAFYSI International Nature Network; and the Princeton Club of Greece.

Both the public and private sectors supported the effort. The Municipality of Marathon provided a cleaning crew and garbage truck during the day, despite the fact that it was Sunday and the national strike by sanitation workers was in effect. Gr. Sarantis SA donated plastic garbage bags used by the volunteers. Agripan SA provided a tractor and crew for cleaning the beach. Skai 100.3 FM radio, Kathimerini and The Athens News provided invaluable publicity for the event.

Following the clean-up, a picnic lunch was held on the beach. Dr. Kimon Hadjibiros, President of the Managing Body of the Marathon-Schinias National Park, made a short presentation on the goals and objectives of the Park. This year will be the first time that the Park receives funding to employ 3 park rangers, who will work from April to November at Schinias.

The Schinias National Park faces grave environmental threats, as there are not enough funds or resources to properly safeguard the area. Every year, over 1 million people visit the beach, mostly Athenians coming for the day. Ton of garbage and refuse are left on the beach and forest, ranging from food packaging to baby diapers to rusted beach umbrellas and chairs. During the high season, over 1,000 cars enter the park, creating significant damage to the beach and dunes.

Yet perhaps the most dangerous threat is that of fire. Schinias–like Olympia–has benefited from the installation of an automated fire fighting system. Unfortunately this system has never been connected to the municipal water main network due to lack of funds and technical incompatibility. With the high winds and large number of visitors during the dry summer months, a fire could start and spread in a very short time period, causing incalculable damage.

Additional initiatives are being planned: interested people are invited to visit the website www.schinias-friends.org to receive information on future events.

Roll of Honour
We warmly thank all organisations and individuals who participated and contributed to this event. (If you contributed and are not on this list, or know someone who was there and is not mentioned, please email corrections to Philip Ammerman at pga@navigator-consulting.com)

Organisers
Athenes Accueil
Foreigners Club of Nea Makri, Marathon, Rafina and Northeast Attica
Hellenic-American Democratic Association (HELADA)
MIAFYSI International Nature Network
NAVIGATOR Consulting Group
Princeton Club of Greece

Municipality of Marathon
Spyridos Zagaris, Mayor
Manolis Sideri, Sanitation Director

Marathon-Schinias National Park
Dr. Kimon Hadjibiros, President

Donations & Support
Agripan SA, ETEMA SA, John Lewis, Gr. Sarantis SA

Media & Promotion
SKAI 100.3 FM, The Athens News, Kathimerini

Car Pool
Murray Brill, Chris Woodfin, Mandy Veil, Athan Vellanites

Promotion & Dissemination
Philip Ammerman, Philip Dragoumis, Myriam Elice, George Keramitzoglou, Minos Kok, Karen Lee, Steven Medeiros, Alexis Phylactopoulos, Daisy Rodriguez, Charity Moschopoulos

Picnic
Regina Tassitano, Alexander Ammerman, Christine Ammerman

Registration Desk
Lieke & Henske Defize

Volunteers & Participants
Despina Alexandri
Philip Ammerman
Alexander Ammerman
Sophie & Stephen Ammerman
Nikos Anastasopoulos
Thomas Anemos
Spyros Beis
Chrystelle Blanchard
Pascaline Bossu
Kostas Botopoulos
Nadia Boujnini-Lahlou
Murray Brill
Michelle Buckley
Elias Carayiannis
Ruth Carter
Jean Chlochard
Katrien Cobbaert
Emmanouel Constantinides
Esme Copestake
Christine Counelis
Lieke & Henske Defize
Catherine Delcourt
Rosemary Donnelly
Philip Dragoumis
John Economides
Dimitris Eleftherakis
Myriam Elice
Yael Eshel
Rebecca Fordham
Dimitris Fragakis
Christina Gavrili
Kalliope Georgpanti
Sonia Gerodimou
Rami Ghoneim
Thodoris Gialiathakis
Keri Golas
Harry & Sue Goldsmith
Kimon Hadjibiros
Scott Hathaway
Anna Haughton
Aya Haykel
Hadeel Hmaidi
Paula Hobson
Andreas Idra
Shelley & Hercules
Romina Istrati
Panos Karametzanis
James Katsinis
George Keramitzoglou
Brady Kiesling
Katerina Kitsili
Minos Kok
Eleana-Sara
Elli & Kassandra Kousouli
Deborah Kyrvrikosaios
Karen Lee
Evan Matiatos
Isaak Mavrides
Judith Mega
Sophie Mitic
Apostolis Mitropoulos
JoonSeok Oh
Angela Papalambrou
Hadar Papatrechas
Alexandros Perrakis
Alexis Phylactopoulos
Theodoros Rentzias
George Saliarelis
Sofia Skourti
Manolis Sideris
Kostas Spyrides
Regina Tassitano
Madeleine Theochari
Barbara Tomasini
Ingrid Vangastel
Mandi Veil
Athan Vellanitis
Spiros Vlahos
Chris Woodfin
Spyridon Zagaris
George Zarkadas
Anthea Zervos
Peipei Zhu

Thursday 13 March 2008

The Naming of FYR Macedonia

This entry is posted in response to the Washington Post's editorial: NATO's European Mission

The Yugoslav province of "Macedonia" was created by Josip Broz Tito in 1944-1945. Prior to this, the area was known as Vardarska, as is attested by maps from this time. The Yugoslav "Socialist Republic of Macedonia" was declared in 1946.

This province was re-named partly with the ulterior aim of expanding the Soviet Union's sphere of influence over northern Greece following WWII. The split between leftist and rightist resistance groups to Nazi Occupation in Greece was long-standing, and the struggle for post-war Greece between the Anglo-American powers, led by Britain, and the Soviet Bloc, had already begun.

For the Greek government and its citizens, the issue of the name cannot be separated from the history of claims made by "Macedonian" irridentists to Greek territory and, indeed, culture. There are several maps published in FYR Macedonia showing their territory to include not only within its current borders, but including parts of Greece and Bulgaria.

The engineered attempt to create a cultural identity by claiming kinship with Alexander the Great only serves to exacerbate the territorial issue. The government of FYR Macedonia recently re-named its airport "Alexander the Great." There is a "Pella Square" and reproductions of Hellenistic statues in Skopje. School textbooks purport that the citizens of FYR Macedonia are in some way descendants of Alexander the Great.

There is no archaeological evidence to support such claims. The current language of FYR Macedonia, for instance, is of Slavic-Bulgarian origin. The major sites of Alexander the Great’s kingdom – Pella, Stagira, Aegea, Dion – are defined by their Hellenic and Hellenistic influences and inscriptions in Greek. Alexander the Great spoke Greek and was raised in Hellenic culture: his tutors included Aristotle, his claim to lead the Hellenic city states against Persia was based on this common culture.

The current debate (which extends back to before 1990) therefore does not allow the Greek government or its people to relinquish its culture, history or heritage, and nor should it. While we have no objection to the cultural identity to FYR Macedonia, that government's deliberate attempt to create a new cultural identity by expropriating ours is disconcerting, given all the historical evidence to the contrary, as well as given the territorial claims and past behaviour of that country.

Since this matter arose in the early 1990s, Greece has consistently pushed for a solution which differentiates the legal identities of FYR Macedonia and the Greek province of Macedonia. This is not an unreasonable demand, and stems solely from the insistence of FYR Macedonia (and the ex-Yugoslavia) on expropriating Greek culture and history, and publishing maps showing a “Greater Macedonia.”

Greece has been a member of NATO since 1952 and of the EU since 1981. It is a leading foreign investor and employer in FYR Macedonia, and has supported FYR Macedonia's application to join both institutions, providing a solution to the issue of the name can be found. Greece has, for instance, supported the deployment of NATO troops during FYR Macedonia's ethnic Albanian problems in the late 1990s, and has approved the signing of the pre-accession agreements with the EU.

Membership in both NATO and the EU imply both good relations and the adoption of European values. Yet FYR Macedonia’s recreation of history continues in a hostile manner which would provoke any neighbour.

Its unwillingness to negotiate over a vital issue for Greece – its neighbour and partner – is arrogant and unprecedented. This problem is of the FYR Macedonian government’s own making, and it is up to that government to negotiate a solution acceptable to both sides.

Wednesday 5 March 2008

Toward a new Policy for Hellenic Citizenship and National Service Obligations

Following in the steps of our hoplite ancestors, Greek citizenship is closely tied to national military service. Upon reaching 18, or graduating from formal education, all adult males are called up for military service ranging from 12-22 months, depending on which branch of the armed forces one is called to serve in.

This policy was born in our revolutionary past: the history of modern Greece from 1821 to the present day is one of constant military struggle, either against Ottoman Turkey (and modern Turkey) or against foreign invaders and other elements, to establish and safeguard our national borders,

Today, however, this policy is deeply inegalitarian, and constitutes a major barrier to both productivity and military preparedness:

• Conscription affects only adult males: females get a “free pass”, even though they could serve in many military positions today.

• Conscription affects not only native-born Greeks, but also citizens with Greek heritage born abroad. Thus, an American born in the United States of a Greek father is eligible for military service, even if he is not a Greek citizen and has never lived in Greece. This is an inconceivable barrier for the 3-7 million diaspora Greeks who may want to take Greek citizenship, but do not see the need for military service.

• Conscription is a crutch which prevent the armed services from adapting to the current age of electronic warfare. The reliance on conscripts for “grunt” work prevents the Armed Services – and their civilian masters – from preparing for war and conflict prevention in the 21st Century, rather than the 20th Century.

• The number of Greeks with “psychological disorders” or disabilities is probably affected by the ability to avoid military service with conditions of this type.

• Most terms of national service occur right at the transition point between upper secondary and tertiary education, or right after tertiary education, when the individual should be focused on the transition from school to work, or to university.

I propose a large-scale, comprehensive reform of the national service obligation, designed to serve the needs of the country in the 21st Century. Such a reform needs to go hand-in-hand with reforming the military, which is the subject of a separate proposal.

Every Greek citizen (male or female), or diaspora Greek wishing to take citizenship, should have the following path towards completing his or her national service obligation.

1. The fundamental requirement is 12 months national service plus Greek language ability.

2. This 12 months of national service can be spent as follows:

• In classical military service;
• In a single-term, 12 month non-military national service obligation;
• In 4 or 6 “internships” of national service, of 3- or 2-months each;
• In 26 or 52 1- or 2-week “internships” over a period of 6-12 years

The latter two options can be combined according to the time availability of each candidate. This national service applies to all citizens or applicants, male or female.

Let’s take a closer look at the non-military option for national service. Greece today has a variety of human resources needs, which cannot (and should not) be met by the classical, permanent employment model of civil service. Such needs include:

• Part-time computer programmers for government IT projects;
• Municipalities and communes with specific project needs;
• Tourism and other forms of national marketing and branding;
• Wardens, fire-spotters and volunteer fire fighters and lifeguards in the summer;
• Workers in NATURA 2000 sites, Blue Flag beaches and other environmental areas;
• Guards and volunteers at sites, museums and archaeological excavations;
• Workers in the Athens Festival or other non-profit artistic or athletic organizations;
• Workers caring for elderly, handicapped, orphans or other at-risk groups;
• Workers in hospitals, universities and other institutions of social character.

I suggest that every Greek citizen, and every person applying for Greek citizenship, should be given the opportunity of working in such employment, as follows:

• People fulfilling their 12-month national service obligations should have the right to choose up to 2 “internships” in the 12 months;

• People fulfilling their obligations in the 4-6 “internship” track should rotate between tasks, so that a person could spend summers between the ages of 16 and 24 in various positions;

• Only those people with a clearly-defined, specialized skill (such as website design, doctors, etc.) should be allowed to work on a 52-week obligation, assuming that their skills can be deployed immediately, with the support of e-Learning, e-commerce or e-government support. This could include, for instance, tax accountants, attorneys, computer scientists, doctors, etc.

A national, online database of qualified organisations and service openings should be established. People should be able to enter a basic profile, and receive a matching list of positions. Induction is at the judgment of the sponsoring organisation. All positions and organisations must be properly vetted, and include some learning component. For instance, diaspora or immigrant Greeks who do not speak Greek adequately should benefit from 2 hours of language learning per day, followed by 6-7 hours of work.

National Service should be linked, if possible, to the educational institution or qualifications of the intern. The option should start upon reaching 16 years of age. Special options should be defined for highly-qualified older people. The link between national service as a bridge between education and the world of work should be emphasised.

All positions should be governed by the same occupational health and safety and employment guidelines as regular workers. The applicants should not be there to do the dirty work. We must recognise that these people represent the future of the country, not a cheap and exploitable labour resource.

At least ½ of such service must be outside the candidate’s home region, so that the candidate learns about other regions of Greece, and so that services are not unfairly concentrated in Attica and Thessaloniki. Appropriate plans should be made for hosting, stipends, living quarters, etc. Accommodation can be procured from the large network of agrotourism houses and small hotels which are usually busy only at certain times of the year, and are under-utilised or closed the rest of the season.

The internship should contribute to four, inter-related goals:

1. Individual development of the person, helping them through the process of self-realisation and personal growth through new experience. The internship should open new perspectives and understanding of Greece and its civil society. It should be the bridge between education and work.

2. Developing and furthering marketable skills and core competences. It should enhance a CV, not detract from it, as far as possible. For instance, high school graduates interested in computer science should work in related fields, gaining practical experience and a work ethic.

3. Alleviating real-world problems, where the usefulness of the process can be monitored. The programme should be needs-based, and should not result in the creation of a huge bureaucracy. Thus, if a programme is developed involving tree planting or cleaning up sensitive ecosystems, the results should be visible. At the same time, such a plan will boost overall development (economic, social and environmental) by channelling resources into more socially-productive areas.

4. Unifying Greece by delivering service, not fulfilling increasingly bureaucratic requirements. It should contribute to creating a new identity of a state that cares for its people, its young and its environment. It should link government and civil society, the centre and the remote regions, Greeks in Greece and Greeks abroad.

At the end of the national service, a graduation ceremony (or citizenship award ceremony) should be held at an appropriate location – Epidavros, the Herod Atticus theatre, Sounion, for those who choose to attend, together with their families. This should be an inspirational event, which affirms their service to their country, and draws people of all socio-economic classes together.

None of this is particularly new: France and Germany have been using alternatives to national military service for years, with good results.

I propose that such a system be pilot-tested on the following groups:

• 1000 diaspora Greeks;
• 2000 Greeks in secondary or upper-secondary education;
• 1000 Greeks in tertiary education;
• 1000 migrants in Greece applying for citizenship.

The cost of such a pilot programme can easily be borne by central and regional governments and municipalities, as well as registered NGOs and other civil society organisations. The pilot should not take longer than 2-3 years: even the longer term internship options can be partially tested in this time.

If the pilot is successful, based on an objective monitoring process, plans should be developed to roll the system out on a national basis in the next 5-7 years, taking into account the transition of military preparedness and staffing requirements.

Tuesday 4 March 2008

A Response to Napoleon Linardatos (III)

Dear Mr. Linardatos,

If I were to base my life and enterprises on reading Kathimerini and To Vima (or the Wall Street Journal), I'd be miserable indeed.

Your initial article implies that no progress at all is being made in Greece, and that EU funding has been a disaster. I've shown that although things are moving slowly, progress is being made, and have backed this up with numbers and facts. For each statement you've made, I've provided a factual counter-argument based not just on established fact (budgets, user satisfaction, GDP, etc) but on daily life. Your response has been to shift the boundaries of the debate, bringing in sources which are subjective and in many cases refer to wholly different subjects from the ones you have initially raised.

Greece is much better off today than it was in the past, with far more opportunities for those people who actually want to work instead of complain about life. Obviously, there's much more to be done, and it is slowly being accomplished. I, for one, am quite happy to be living, investing and working here, and I don't need to look to the past to enjoy life.

Your quotation of the Index of Economic Freedom is interesting, but if you really believe that it's easier, less-bureaucratic or less expensive to establish or operate a company in Germany, Belgium or Sweden than in Greece, then I am afraid you are far removed from reality.

I'm sorry you have such a negative view of things, and I wish you all the best in the future.

Philip

PS: Should you ever be in Greece, and can stand to hear some good news, I'd be glad to invite you for an ouzo or cup of coffee so we can continue the discussion.

Napoleon Linardatos Responds (II)

Mr. Ammerman,

Since you don't have to take my word for the issues we discuss, I gathered a few articles from the two most credible newspapers papers of Greece, Kathimerini & Vima, which make my case.

Πλήρης η κατάρρευση για την οικονομία της Βόρειας Ελλάδας.
Στη Νάουσα η ανεργία φτάνει το 50% - Στη Ροδόπη ο αγρότης πρέπει να μετουσιωθεί σε επαγγελματία.

Η γραφειοκρατία μάς κοστίζει ακριβά.
Το «διοικητικό κόστος» αποτιμάται στο 6,8% του Ακαθάριστου Εθνικού Προϊόντος.
Quote:
Η γραφειοκρατία στην Ελλάδα έχει προσλάβει τέτοιες διαστάσεις ώστε το κόστος της να αποτιμάται στο 6,8% του Ακαθάριστου Εθνικού Προϊόντος (ΑΕΠ) - ένα από τα υψηλότερα ποσοστά στην Ευρώπη. Αλλά παρά τις κατά καιρούς δεσμεύσεις και διακηρύξεις (στα λόγια) αρμοδίων, μηδέ του Πρωθυπουργού κ. Κ. Καραμανλή εξαιρουμένου, πολιτική βούληση για την αντιμετώπισή της δεν υπάρχει και δεν φαίνεται στον ορίζοντα η παραμικρή πιθανότητα περιστολής της.

Η ανταγωνιστικότητα των οικονομιών.
Ελλάδα: 25η θέση ανάμεσα στις 27 χώρες-μέλη της ΕΕ.

-That means some ex-communist countries are ahead of us in competiveness.

Το έλλειμμα του ισοζυγίου διευρύνθηκε ανησυχητικά.
Ανήλθε στα 23,8 δισ. – Μεγάλος ασθενής η ανταγωνιστικότητα της χώρας

Η ψευτομεταρρύθμιση.
Quote:
Κάθε ελληνική κυβέρνηση θεωρεί υποχρέωσή της να αφήσει πίσω της μια «μεταρρύθμιση». Ιδιαίτερα αυτή η κυβέρνηση που έχουμε σήμερα, η οποία προτού ακόμη εκλεγεί μιλούσε για μεταρρυθμίσεις και σήμερα, έχοντας πίσω της μια χαμένη θητεία διάγει μια δεύτερη ίδια και θεωρεί χρέος της να κάνει κάτι. Βρήκε λοιπόν το Ασφαλιστικό και αποφάσισε να το μεταρρυθμίσει. Η έννοια της μεταρρύθμισης στην Ελλάδα συνδέεται απόλυτα με την αλλαγή των νόμων και μόνο, χωρίς ποτέ να εξετάζεται το αποτέλεσμα. Η κυβέρνηση λοιπόν αλλάζει τους νόμους για να σώσει τα Ταμεία από την πιθανολογούμενη αλλά όχι αποδεδειγμένη χρεοκοπία τους σε τριάντα χρόνια από σήμερα. Ωστόσο το αποτέλεσμα θα είναι μηδενικό και ίσως αρνητικό.

479.763 «γαλάζιες» προσλήψεις
Quote:
Σχεδόν μισό εκατομμύριο, για την ακρίβεια 479.763, προσ-λήψεις πραγματοποιήθηκαν από την κυβέρνηση τα τελευταία τριάμισι χρόνια, σύμφωνα με στοιχεία τα οποία κατατέθηκαν στη Βουλή και αφορούν τον αριθμό των μόνιμων υπαλλήλων, των συμβασιούχων και των εποχικών που διορίστηκαν από το 2004 ως και σήμερα. «Πρωταθλητής» εμφανίζεται το υπουργείο Εσωτερικών και Δημόσιας Διοίκησης με 57.680 προσλήψεις, τις περισσότερες σε δήμους, κοινότητες και νομαρχίες, και ακολουθεί το υπουργείο Απασχόλησης - στο οποίο διετέλεσαν υπουργοί οι κκ. Π. Παναγιωτόπουλος και Σ. Τσιτουρίδης - με 33.385 προσλήψεις. Τρίτος στη σειρά υπουργός σε αριθμό προσλήψεων έρχεται ο κ. Δ. Αβραμόπουλος, υπουργός Υγείας, ο οποίος μονίμως διαμαρτύρεται ότι δεν μπορεί να προσλάβει νοσηλευτικό προσωπικό, ζητώντας μάλιστα και παρέμβαση της Βουλής, για διακομματικές προσλήψεις. Το υπουργείο Υγείας πραγματοποίησε αθορύβως 25.702 προσλήψεις.

Τα ευτράπελα του κρατικού προϋπολογισμού.
Το «σύνδρομο της Πορτογαλίας» απειλεί την Ελλάδα
Ο υπερδανεισμός υποθηκεύει τις μελλοντικές γενιές και η ελληνική οικονομία κινδυνεύει αν δεν προωθηθούν άμεσα οι αναγκαίες μεταρρυθμίσεις
Quote:
Το μοντέλο της ανάπτυξης με δανεικά, είτε ο δανειολήπτης είναι το Δημόσιο είτε τα νοικοκυριά, πνέει τα λοίσθια, ο υπερδανεισμός υποθηκεύει τις μελλοντικές γενιές και η ελληνική οικονομία κινδυνεύει να χτυπηθεί από το «σύνδρομο της Πορτογαλίας» αν δεν προωθήσει άμεσα τις αναγκαίες μεταρρυθμίσεις

Ο κ. Αλογοσκούφης δείχνει υπουργούς για τα ελλείμματα
Quote:
Αδυναμία άμεσης εξόφλησης των υποχρεώσεών του προς τα ασφαλιστικά ταμεία και την τοπική αυτοδιοίκηση δηλώνει το Δημόσιο και μάλιστα επισήμως «διά στόματος» του υπουργού Οικονομίας κ. Γ. Αλογοσκούφη. Την περασμένη εβδομάδα (την Τρίτη στη Βουλή και την Τετάρτη στο υπουργείο Οικονομίας) ο κ. Αλογοσκούφης δήλωσε ότι οφειλές ύψους 1,3 δισ. ευρώ προς τα ασφαλιστικά ταμεία και 1,5 δισ. ευρώ προς την τοπική αυτοδιοίκηση θα καταβληθούν το 2008 με ομόλογα του Δημοσίου. Σε ό,τι αφορά τα ομόλογα εξόφλησης προς τα ασφαλιστικά ταμεία θα είναι μακροχρόνιας διάρκειας, ενώ για τις οφειλές προς την τοπική αυτοδιοίκηση θα εκδοθούν ομόλογα τριετούς, πενταετούς και δεκαετούς διάρκειας.

So to pay money they already owe they are issuing new bonds. Amazing!!!

Ευημερούμε με δανεικά!
Quote:
Στον προϋπολογισμό του 2007 τα έσοδα του κράτους μας υπολογίζεται εφέτος να φθάσουν τα 53 δισ. ευρώ περίπου, στα οποία περιλαμβάνονται και οι δωρεάν επιχορηγήσεις της Ευρωπαϊκής Ενωσης. Οι δαπάνες όμως που έχουν προγραμματιστεί για το 2007 φθάνουν τα 80 δισ. ευρώ, εκ των οποίων 23 δισ. ευρώ είναι για χρεολύσια και 10 δισ. ευρώ για τόκους δανείων που χρωστούμε. Αρα το έλλειμμα μεταξύ εσόδων και δαπανών ανέρχεται στα 33 δισ. ευρώ. Και το σύνολο των χρεολυσίων και τόκων βρέξει - χιονίσει πρέπει οπωσδήποτε να το πληρώσουμε, γιατί αλλιώς θα κηρύξουμε πτώχευση. Πού θα τα βρούμε; Προβλέπεται να τα δανειστούμε. Και το ένα δάνειο συσσωρεύεται δίπλα στο άλλο και «καταφέραμε» το δημόσιο χρέος μαζί με τις εγγυήσεις να έχει φθάσει σήμερα τα 235 δισ. ευρώ. Δηλαδή χωρίς δανεικά δεν ζει το κράτος μας, αφού αν περιοριζόταν μόνο στα εφετινά προβλεπόμενα έσοδα των 50 δισ. ευρώ και έπρεπε να εξοφλήσει για τόκους 10 δισ. ευρώ και για χρεολύσια παλαιών δανείων 23 δισ. ευρώ θα απέμεναν μόνο 17 δισ. ευρώ για τις κανονικές δαπάνες του Δημοσίου, που δεν φθάνουν ούτε για τους μισθούς και τις συντάξεις του Δημοσίου, που ανέρχονται σε 20 δισ. ευρώ! Πόσοι το ξέρουν αυτό;

Greek Pseudo-Privatization
From The Wall Street Journal Europe

Quote:
Given the country's statist tradition, it is no surprise that even Greece's nominally conservative Prime Minister Kostas Karamanlis has never been a fervent free-market advocate. After five years in power, the government has so far managed only a single full-scale privatization. All public utilities, for example, are still state-run. A recent attempt to privatize telecoms operator Hellenic Telecommunications Organization SA (OTE) resulted in a protectionist backlash.

Θα πληρώσουμε 6,5 δισ. ευρώ περισσότερους φόρους το 2008

To see our 'progress' since 2004 one can see our ranking in the Index of Economic Freedom.

Our rank in 2004 was 78 out of 155 countries. In 2008 our rank is 80 out of 157 countries. Zero progress. (Our regional rank is 34 out of 41)

Ahead of us in economic freedom such hardcore capitalists such as: Denmark #11, Netherlands #13, Finland#16, Belgium #20, Germany #23, Sweden #27.

By the way, I don't believe that the Simitis government was any better – the point I was trying to make is that the Karamanlis government is equally bad.

Monday 3 March 2008

EU Funding and Greek GDP Growth

The question of the role of EU funding to total GDP in Greece has been raised in the recent exchange of emails with Mr. Napoleon Linardatos. I decided to do my own analysis based on public statistics to try to determine the relative weight of EU funding to GDP and GDP growth. My initial estimate was that at present, EU funding is not more than 1% of GDP.

Total EU Funding under the 3rd Community Support Framework (CSF) and the Cohesion Funds amounted to a total of EUR 25.9 billion, with absorption scheduled between 2000 and 2006. This amount was to be matched by EUR 11.7 bln of public spending, and EUR 10.6 bln in private spending, for a total of EUR 48.3 bln.


As seen from this table, total EU funding amounted to 54% of total allocated investment funding in this period, and 69% of all allocated EU and public sector investment.

In order to comparing this to GDP (market prices) over the same time period, we have three options:

1. Compare actual disbursement to GDP: I am unable to find the actual disbursement figure on the Ministry of Finance, Statistics Service, or 3rd CSF Managing Authority websites.

2. Distribute 100% of funding in a linear manner, i.e. take the total amount of EUR 25.9 bln and divide by 7 years, leading to a disbursement of EUR 3.71 bln per year.

3. Distribute the 3rd CSF amount actually absorbed by the end of 2006, which was 58% of the total. In this case, we take 58% of EUR 25.9 bln, and distribute equally over 7 years.

The table below shows the effect of EU funding as a share of GDP using these two methods:

I find that the method of linear absorption of 58% of the total is a more realistic figure, since it’s well-known that Greece is behind in absorption. If disbursement does not actually take place, then this value does not accrue to GDP figures.

As seen here, EU funding share to GDP fell from 1.6% in 2000 to 1% in 2006. Given the rate of GDP growth and the size of the 4th CSF, this number is likely to fall further in the future.

Given this relative weight of EU funding to Greek GDP, it is unlikely that EU resources play a material direct role in current GDP growth, which has averaged between 4.2% and 3.8% in real terms in the last 6 years. Where EU resources are invaluable are in instilling a strategic, long-term planning framework for economic development in Greece. The promise of funding creates a commitment to a long-term plan which cannot easily be changed by incoming governments. Together with European Monetary Union and the Maastricht conditions on inflation, public debt and annual deficits, this provides a rational macroeconomic framework for government spending and growth.

A response to Napoleon Linardatos (II)

Mr. Linardatos,

Thank you for your response to my comments. I am glad that we both share a love for Greece, and a commitment to market economics. I fear, however, that you may not have a proper picture of what is occurring in Greece over the past few years.

As I evaluate matters, things are getting better, although the situation remains far from ideal, and much remains to be done. I will support my evaluation through factual responses to your comments.

Your comment on public works is misplaced. You state that:

I am not against public works. The point I was trying to make is that all this huge public projects have always been seen as a substitute for the real work that is necessary to change Greece. You only have to watch news reels from the 50s to see the same old picture – some prime minister, cement, bricks and the false sense of progress.

There is abundant evidence among classical economics that investment in public works yields both immediate and future growth in productivity, employment and GDP. In any case, the examples of public works you mentioned – the Athens Metro and the Egnatia Motorway – are both good examples of public-private partnership in infrastructure development, and a further indication of the “liberal” tendencies in the Greek economy.

The Athens Metro, you will recall, is managed by a public-private consortium, and was developed by Olympic Metro S.A., consortium of 22 firms led by Siemens Transport Engineering, under BOT procedures (build-operate-transfer) with the support of EU Structural Funds. It is a profit-making enterprise which facilitates transport in Athens, carrying over 650,000 passengers per day, with a 99.8-99.9% delivered services rating, and with a passenger satisfaction rating over 82% in 2006 (the last year public figures are available).

The Egnatia Motorway is being built with funding from the Hellenic Public Investment Progamme, the EU Community Support Framework and the European Investment Bank. Individual road sections are contract and built on a BOT basis (build-operate-transfer). It is managed by an independent company on a profit-making basis, and will almost certainly be listed on the Athens Stock Exchange once it is complete.

I would hardly consider either of these two projects to engender a false sense of progress, and certainly have nothing to do with the 1950s news reels you mention. I use both the Egnatia Motorway and the Metro on a regular basis, and am quite happy with the result.

You further state that:

Of course, no politician is willing to do the hard thing like liberalizing the markets, cut taxes and finally stop hiring any more people in government.

In fact, the current government has made several steps in all three areas:

Market Liberalisation
Following EU common market organisation regulations, a number of sectors have been fully deregulated, including aviation, shipping, banking, telecommunications, electricity generation and transmission, etc. If you follow the news in Greece, you will see that the ports of Pireaus and Thessaloniki are currently being privatised, leading to extensive strikes of the dockworkers’ unions, while DEH, the Public Power Corporation, is considering a strategic alliance with Germany’s RWE. The share of the government sector in total GDP has been falling, while at the same time government stakes in companies listed on the Athens Stock Exchange (such as OTE) have been falling (this is a process begun under the Simitis Government). Last year, Greece attracted EUR 4.3 billion in foreign direct investment, about 2% of GDP. The entire story of the past 4 years has been one of liberalisation, as any objective observer of events would confirm.

Cutting Taxes
In fact, taxes have been cut under the Tax Reform Law of 2004, and I can confirm this in practise from my registered company in Greece as well as my personal income taxes. The corporate tax fell from 35% to 25% in stages (in 2008, we are paying 25%), while the tax-free threshold for personal taxes rose to EUR 12,000 per person per year. The personal central tax rate will be reduced to 25% from 30% between 2007and 2009, while the tax brackets will be raised. In fact, direct corporate taxation for a limited liability company is much lower in Greece than in the United States, especially if you combine Federal and State income taxes.

Stopping Public Sector Employment
Under the Karamanlis government, there have been a number of initiatives to slow and reduce public sector employment, ranging from early retirement packages to the use of temporary contracts in the public sector (as opposed to permanent employment). The highest year of public-sector employment was 2001 during the Simitis years, when public recruitment reached a high of 58,510 new employees. Since then, the figure fell to 41,231 new recruits, and is scheduled to fall further through the implementation of e-Government initiatives:



Your comment on the Olympic Games is inexplicable. You state:

Well, if you spend 11 billion euros you'll eventually get something out of it. But you only have to see how other counties –for instance Australia - benefited from their Olympic Games to realize the poor job we did despite all the billions spent.

I’m not sure what numbers you are using. The final budget reporting in Greece for the Games themselves is $ 11.6 billion, of which $ 1.39 billion was spent on security, involving the assignment of 70,000 police and soldiers to provide security at Olympic sites, and an additional 35,000 people guarding railways and borders. Sydney did not have to spend this amount, because of events you are well aware of as a New Yorker. Furthermore, Greece had to make a number of additional expenses Australia did not have to: the number of sport events was at a record high, leading to much higher investment in venues such as a rowing centre or baseball field which Greece has no use for after the Games. The Games did not occur in one city, but all over Greece. The number of official visitors (press & official), athletes and visitors attending the Games was at an all-time high. You can't compare the Sydney and Athens Olympics on a like-for-like basis.

Furthermore, you don't present any factual evidence that Greece has done badly, apart from simple conjecture. Have you factored in the positive effects on tourism and real estate values since the Olympic Games? Are you using inflation-adjusted statistics? What numbers do you compare between the Athens and Sydney Olympics, and how much time has elapsed, which enable you to conclude that we did a poor job?

Your comment on EU Assistance is again again off the mark. Thanks to steadily high growth, the current 4th Community Support Framework will be the last in which Greece qualifies as an Objective 1-2 country. The next strategic planning framework, after 2013, will see far lower amounts of EU assistance, since Greece has achieved a significant rise in GDP per capita. Your representation of GDP being driven by EU funding is wrong – I suggest you see the actual absorption rates of EU funding versus general GDP growth per year, and you will see that EU funding is less than 1% of real GDP.

You also don’t seem to understand that EU assistance under the Structural Funds or Common Agricultural Policy is not confined to Greece alone: these are support programmes given to the entire European Union. Even Germany and Britain benefit from such programmes. Yet your viewpoint seems to be that because Greece is absorbing its funding commitments, it is doing something wrong, which is frankly absurd.

Your comment on Public Sector Borrowing is correct in that it is high, but you ignore that fact that Greece is committed to achieving a balanced budget by 2010, that both borrowing and public debt as a share of GDP have been steadily falling since the debt was re-adjusted in 2004-2005 to account for military expenditure, and that there are a number of initiatives underway to reduce debt and raise revenue from one-off and recurring items. Your depiction of the Greek economy as being based in “international liquidity” (?) and EU subsidies is simply wrong – you’d be much better off checking any serious source (IMF, World Bank, Ministry of Finance, Economist Intelligence Unit) for the correct structure of GDP.

The Kathimerini article you refer to merely supports my point: this is the first government that is making a concerted effort at fiscal consolidation and discipline, particularly over the semi-governmental organisations. This is a hang-over from the previous, patronage system of development, and to his credit, Mr. Alogoskoufis is trying to reign them in, and hopefully privatise or close some of them. OSE (the railroad organisation) and Olympic Airways are the two largest loss-making organisations. As bad as the situation is now, it was far worse under previous administrations, and this government is trying as best it can to solve the problem.

There are a number of other liberalisation and competitiveness initiatives underway which you may be aware of, but did not see fit to comment on:

• The role of Public-Private Partnership (PPP) funding for infrastructure is increasing. There have already been EUR 6 billion worth of contracts signed, and this will increase over the next 3 years.

• A new Education Law has been passed. While hardly ideal, it’s a vast improvement over the old situation. Much remains to be done.

• E-Government and e-Learning initiatives are growing. Increasing numbers of transactions in the private sector and with the government are being done online. While overall ecommerce spending and internet penetration remain low, growth is rapid, and the 4th CSF should see a rapid increase in both segments.

• FDI and privatisation income are either increasing or remaining at strong levels. There is a high demand for Greek government bonds – every offering is over-subscribed.

• Tourism will continue its high growth pattern. A number of large investment projects have been announced in Crete and the Peloponnese, and many have received approval and are under construction. The Olympic Games has played a major role in the branding and positioning of Greece on the tourism map.

• The National Health Service is being restructured. Transparency has been introduced into public procurement in this area, leading to a fall in procurement costs and improving efficiency.

• For the first time, all property and transactions recorded by social insurance funds are being put online, again enabling transparency.

• The number of NGOs, companies with Corporate Social Responsibility (CSR) programmes, and volunteers is rising year after year. This shows the active engagement of civil society in productive ways.

Of course, many things need to be improved – no one doubts this. And of course there are future challenges which make the need for reform all the more urgent. Efforts are being made. But I am struck by the fact that you see nothing positive at all in Greece, except the idealised past.

If you do love your country, as you claim, then you may reflect that your country would be better served by a fair and balanced representation of the facts, rather than a dismissive reinforcement of stereotypes. Simply trashing the efforts of an entire country, and ignoring the real efforts made to improve things is a strange way of expressing an opinion.

Napoleon Linardatos Responds

Mr. Linardatos has responded to my blog entry, and I would like to post his reply in full.

Mr. Ammerman,

I would like to thank you for taking the time to read the article about Greece. Although we disagree that's because we feel very strongly about a country we love.

I feel obliged to reply to some of the points you made. I have put your comments in italics.

You say:

In any case, what does Mr. Linardatos suggest? Eliminate the Metro? It's doing far better by any standards – customer satisfaction, delivered trips, passenger traffic and income – than any equivalent metro in a private-sector heaven such as the UK, where the rail and Underground privatisations have become a model of how not to implement public-private partnerships, and where the concept of good service is a distant dream.

My response:

I am not against public works. The point I was trying to make is that all this huge public projects have always been seen as a substitute for the real work that is necessary to change Greece. You only have to watch news reels from the 50s to see the same old picture – some prime minister, cement, bricks and the false sense of progress.

Of course, no politician is willing to do the hard thing like liberalizing the markets, cut taxes and finally stop hiring any more people in government.

You say:

The Olympic Games have certainly contributed to a tourism revitalisation. The centre of Athens and other cities has been renovated and changed. New sports and administrative facilities exist which did not exist before, the majority of which have now been leased or tendered to the private sector, and are bringing in income. The Games have contributed to a new self-confidence on the part of many Greek people, and certainly among Greek companies. There's been a significant increase in tourism arrivals, particularly from "new" markets such as Asia and America. Hotels in Athens, Thessaloniki and a number of other destinations have been renovated and have higher occupancy. The tourism industry is hardly ideal, but on the other hand it's certainly doing better than that of many other countries.

My response:

Well, if you spend 11 billion euros you'll eventually get something out of it. But you only have to see how other counties –for instance Australia - benefited from their Olympic Games to realize the poor job we did despite all the billions spent.

You say:

The article is also full of misleading exagerations. For instance, one sentence states that European assistance has been to Greece what oil has been to the Middle East; the lifeline of poor government, mischievous habits and exasperated hopes. At another point, the article states that in some years, EU assistance equalled up to 3.7% of GDP. Let's set aside the fact that the energy sector in Saudi Arabia, for instance, is far higher than 3.7% of GDP: according to Wikipedia, the petroleum sector accounts for "75% of budget revenues, 45% of GDP, and 90% of export earnings."

My response:

I didn't say that we have the same degree of dependency as say Saudi Arabia with oil. But we are dependent on the European assistance for whatever growth occurs in the economy. The present administration when it was in opposition used to criticize the Simitis government for the reason that only a small fraction of growth came from the private sector and the rest of it – around 85% - was European assistance. The same sorry thing occurs now. It would be a wake-up call if tomorrow EU cut all assistance to Greece. Then with an annual GDP growth around 0.5% – 1% we would really have to do something about it. Now thanks to EU aid we think we can take a long holiday from history and harsh economic realities.

You say:

In fact, EU assistance has totally changed the way the Greek government works. When Greece joined the EU in 1981, it was an economy with a high reliance on low-value-adding sectors such as agriculture, tourism and natural resources, recovering from a disastrous military dictatorship. Its industry was inefficient and protected by tarriffs and opaque benefits, its educational attainment levels low, and its society still very traditional in outlook. EU assistance has helped transform the country, not least of which by requiring a strategic approach towards managing national investment priorities. Yes, of course there have been trade-offs, but EU support has been irreplaceable in helping Greek enterprises, individuals and government authorities adapt to the needs of the emerging global economy.

My response:

The Greek government has not changed the way it works since time immemorial. The dictatorship you mention in this paragraph did not differ in its view of the role of government in the economy from the present bunch of luminaries. They were firm believers in government intervention but they just did not have financial flexibility that we have now.

Although the Greeks complain day and night it's very likely that things will get much worse in the future. Our economy has two pillars: global financial liquidity and EU aid. The Greek government will have borrowed from the September of 07 till the end of 08 around 40 billion euros. This kind of heavy borrowing – around 45% of public expenditures - is not sustainable and it's entirely based on a very generous and perhaps naïve global financial market. If that market turns sour we are toast. By the way, all this borrowing its not to cover any kind of capital investments by mainly to cover public sector payroll, pensions payments etc.

Also EU aid will not go for ever. There are new members in the club who want a piece of the pie and also the German taxpayer won't go on forever giving to the poorer relatives.

It will be really sad if one day we look back at today with nostalgia.

You say:

Since 2000, Greece has supported the Lisbon Agenda, with all the benchmarks and open policy planning this entails. Since joining the EMU, its budgetary process has become much more disciplined and transparent, particularly since the Karamanlis government took power in 2004. There is no comparison between the quality of fiscal reporting in 2008 and 1988 or 1998 – I invite Mr. Linardatos to examine any Ministry of Finance budget and prove the contrary.

My response:

I don't have to do much work for that. Look at this story from today's Kathimerini (March 2, 2008) about the 16 billion that the government doesn't know where and how it's spent. By the way that's around 18% of the budget.

You say:

Again, I wonder where the logical implications of this article take us. Should Greece reject EU spending? Should we aspire to return to the era of the Periclean city state, when slavery was common, women were disenfranchised, and political power was held by a narrow, property-owning elite? Has Mr. Linardatos read Thucydides' Peloponnesian War or Herodotus' Histories in their entirety, or only Pericles' Funeral Oration? Has he heard of the slaughters of Corfu, Naxos, Sepeia, Heracleia, Tyre, Gaza or any of the many other such incidents in our long and bloody history?

Indeed, I am afraid that Mr. Linardatos may perhaps be spending too much time in the ivory tower of some Brussels think tank, excessively influenced by classical US conservatism, to see or understand what is happening in Greece today. Surely, things are not ideal, but as someone who has owned companies, lived and worked in the US, France, Germany and Greece, I am quite confident that the situation here is improving, and is in fact competitive in many more ways that we readily credit. We – as citizens and residents of this country – would do better to roll up our sleeves and see how we can contribute, rather than steep in a misplaced sense of bitter nostalgia and intellectual incoherence.


My response:

It would be entirely naïve of me to believe in any idealized version of any history. But in history there are moments that we can be proud of. There are also ideas that when we read them we are in agreement. The sad thing about Greece today is that if one wants to be inspired he has to always look in the past.

By the way, no ivory towers for me, just a working class fellow living in New York.

Cordially,
Napoleon Linardatos


Email: meticslexicon@gmail.com
Webpage: http://www.meticslexicon.blogspot.com/

Sunday 2 March 2008

NAFTA and Reality

NAFTA has raised its ugly head again in the campaign debates, and a HELADA member has asked for my opinion on this. Before responding to this, I'd like to ask a rhetorical question: "What is NAFTA?" While this may be a pithy response, the truth is that the issue is extraordinarily complicated, different people understand and attribute different things to or by NAFTA, and there are viewpoints which are uninformed by economic cause-and-effect.

First of all, let’s look at actual campaign demands. The Obama website has this “platform” under “Issues - Trade”

Amend the North American Free Trade Agreement: Obama believes that NAFTA and its potential were oversold to the American people. Obama will work with the leaders of Canada and Mexico to fix NAFTA so that it works for American workers.

On the Clinton site, I don’t find any direct mention of NAFTA, except the following indirect parts of a press release:

· Appoint a trade enforcement officer within the office of the United States Trade Representative (USTR) and double the size of USTR’s enforcement unit. The Bush administration has been extremely lax about enforcing our trade agreements, and workers are suffering as a consequence. Hillary will appoint a trade enforcement officer within USTR who will be responsible for ensuring that our trade agreements are vigorously enforced. She will also double the size of the enforcement unit. The current staff is too small to monitor and enforce the increasingly complex agreements.

· Overhaul the Trade Adjustment Assistance (TAA) program to ensure that workers who have lost jobs because of global competition get the support they need. TAA provides job training, income support, a health care tax credit, and job placement assistance. Hillary will modernize the program to ensure that it is truly helping workers hurt by global trade. First, she will extend TAA benefits to service workers. Today, workers who produce a service rather than a product are ineligible for TAA, leaving everyone from call-center operators to radiologists, without assistance. Second, Hillary will broaden TAA to cover all workers whose plants have moved abroad. Workers are currently ineligible for TAA if their plants relocated to countries with which we have not signed free trade or trade preferences agreements. This outdated rule means that when plants shift from America to low-wage countries like India and China, laid-off workers are ineligible for TAA. Third, Hillary will double funding for TAA’s job training program to $440 million. And fourth, she will overhaul the Health Coverage Tax Credit (HCTC) to ensure that it is actually making health care affordable for laid-off workers. She will increase tax credit to 90% of premiums from the current 65%. And for laid-off workers without access to COBRA or a qualified state plan, she will make other options, she will allow them to use the HCTC to buy into the Federal Employees Health Benefit Plan (FEHBP).


Judging from these two “Platforms”, Obama’s is far too vague to be practical in any sense of the word, while Clinton’s is a good micro-level initiative that will do nothing to offset prevailing trade patterns and their commensurate job losses.

Rather than providing complicated statistics andsources, I’m going to summarise the current situation with trade and wider economic patterns in the US:

1. The US has a massive overall trade deficit that is caused by fundamental imbalances between supply, demand, the government deficit, the structure of the US economy, and the way trade statistics are kept. This is an extremely complex subject, and I’m happy to answer any specific questions.

2. The top 5 US trade partners in 2007 for merchandise trade (trade in goods) are:



3. The merchandise trade deficit does not include financial, tourism or other service trade flow between these partners. It also does not differentiate between goods made by US companies in these countries and exported to the US.

4. The only global standard regulating trade is the World Trade Organisation (WTO), which establishes tariff and quota levels for merchandise categories between countries. Under WTO rules, for instance, Indian-based companies can export a certain number of tonnes of cotton medical gauze to Europe under a quota without tariffs, followed by a second quota with a certain tariff level, and so on.

5. There are no globally-recognised and adopted standards on either labour or environment. If there were, it is almost certain that the United States would not meet some if not many such standards. For instance, US standards of pesticides and organic products are much less strict than European ones; on the other hand, they may be much more strict than Brazilian ones. US "right to work" standards enable US employers to fire workers much easier than equivalent European regulations. such disparities will apply with current national regulations in NAFTA as well.

6. NAFTA is a trilateral trade agreement that is permissible under WTO regulations. However, the only emphasis under the present agreement is on tariff levels. There are no labour or environmental standards in the agreement which would reverse trade flows or increase the economic competitiveness of American workers.

7. Past attempts to regulate merchandise imports (and traffic) by the US have been unilateral and have created significant economic damage to Mexico and Canada. The example of Mexican trucks operating in Texas, or Canadian beef and timber exports to the US, are prime examples.

The current patterns in trade have nothing to do with NAFTA, but with American production and consumption patterns, and with the way statistics are recorded. In 2007, America had a trade surplus with very few countries: the main ones were The Netherlands ($ 14.6 bln); Hong Kong ($ 13.09 bln); Australia ($ 10.59 bln); United Arab Emirates ($ 10.27 bln); and Belgium ($ 10.01 bln). As you can see, our trade surplus is dwarfed by our deficit.

For the most part, these trade trends are irreversible. It would take an inconceivable investment in manufacturing capacity to reverse trade flows, requiring massive government subsidies to bring value-adding industries to competitive retail prices. There are very few historical examples that support such trends in specific industries, although the military and aerospace industry is a good one, and may explain the powerful influence of these lobbies on US foreign policy. In most consumer technologies, however, subsidies and labour requirements have already been tried in IT, shipping, or appliances, or steel, and have failed.

I won’t go into this in too much depth, but the basic fact is the we are operating in a global knowledge economy, and the process of re-engineering cars or washing machines or computers (for consumers) is remarkably easy. Therefore, there are no barriers to investment, capacity expansion and competition in this area, particularly give the global supply chain and the transparency of the internet. In this environment, investment (in production capacity) will follow the path to areas with the lowest-cost production (with acceptable transport links), while sales strategy will follow the path to the market with the highest margin on sales.

Now, to come to the specific issue of NAFTA:

1. The structure of the US trade deficit with Mexico and Canada will continue. The US does not have the same competitive advantage that these two countries have. Canada’s surplus with the US is driven by raw materials and natural resources, including agri-food. Mexico’s surplus is driven by low-cost textiles, consumer appliances and components, as well as some agri-food and natural resources categories.

2. Both Mexico and Canada are far more open to US imports that vice-versa (you can examine, for instance, the number of complaints brought to the WTO as a good indicator of this). This implies that if the US pushes for different environmental and labour standards, Mexico and Canada will probably implement these far faster and more effectively that the US will. This viewpoint is confirmed by the fact that implementation in the US depends on 50 states, which have a fragmented approach and lack resources for cost-effective national implementation.

3. Barack Obama states that [to paraphrase] “NAFTA has to be fixed to be good for US workers.” The only way this can be done, presumably, is by protective tariffs on imports into the US. This is legally impossible under current NAFTA rules, and there would be no reason for Mexico and Canada to accept this without equivalent tariffs on US exports (such as vehicles or equipment), which would simply hurt workers in other sectors while making consumer products, energy and food more expensive for everyone.

4. One correct response would be to amend national policies and incentives to enhance the competitiveness of US manufacturing. The legacy costs of health care to US manufacturing are disastrous, and a main cause of low trade competitiveness. However, as I’ve written in other entries, this would mean above all reforming health care and education. Such reforms take time and a bipartisan approach: I doubt they would be effective in the short term.

5. Hillary Clinton’s recommendation for expanding the TAA is a better one, because it is more targeted. However, it can only be a short-term fix, which over time would only lead to a further decline of key manufacturing competitiveness absent an effective manufacturing strategy.

If the US is to compete in global trade, it needs to manufacture goods that consumers in other countries want, at an acceptable price. There are many structural factors that preclude this. The fact that US firms have been offshoring for years now - establishing subsidiaries in lower-cost countries, or simply licensing manufacturing abroad - means that traditional industries will be lost in any case. There are solutions to this, but they are extremely complex to explain, and have a high variance from industry to industry, and region to region.

This brings me back to my original question: "What is NAFTA?" My impression from the current election is that NAFTA is a convenient stalking horse for both candidates, neither of whom seems to understand why America is losing its competitiveness, or how to combine long-, medium, and short-term policy changes to improve competitiveness. Of the two candidates, however, Hillary has much better, more targeted micro-interventions, but is probably missing the big picture. As much as I like Obama (and I voted for him), on the economy, he’s simply posturing on the economy: there are few substantive details in his policy recommendations.

I'm sorry to say this, but the debate on NAFTA among political circles is, at present, a useless diversion. It's a sop to the party faithful, but irrelevant to reality, and offensive to two of our strategic partners, Canada and Mexico, who are only playing by the rules, and doing so better than we are.

I’m more than happy to answer or explore specific questions.

A reality-based response to Napoleon Linardatos’ article: Modern Greece: Decadence Unbound

It’s difficult to understand what to make by Napoleon Linardatos’ article: Modern Greece: Decadence Unbound. It’s a mishmash of contrary thinking and nostalgia for an idealized, fictional past, which is logically incoherent and at odds with the reality in Greece, not to mention the European Union.

I note, for instance, his statement that

The Athens underground was supposed to solve the city’s traffic problems, the Olympic Games were supposed to revitalize tourism, and the Egnatia Motorway is supposed to make Greece the economic tiger of the region.

Actually, the Athens underground was never supposed to solve Athenian traffic problems, but it has been very successful in alleviating them, and contributing to a solution. Passenger traffic currently far above the business plan projections, and passenger satisfaction at record highs. The service has opened up new horizons for people living in the northern and southern suburbs, where previous access to public transport was very limited. Traffic problems continue, but this is as much due to the fact that over 300,000 new cars are registered in the Attica region each year.

In any case, what does Mr. Linardatos suggest? Eliminate the Metro? It’s doing far better by any standards – customer satisfaction, delivered trips, passenger traffic and income – than any equivalent metro in a private-sector heaven such as the UK, where the rail and Underground privatisations have become a model of how not to implement public-private partnerships, and where the concept of good service is a distant dream.

The Olympic Games have certainly contributed to a tourism revitalisation. The centre of Athens and other cities has been renovated and changed. New sports and administrative facilities exist which did not exist before, the majority of which have now been leased or tendered to the private sector, and are bringing in income. The Games have contributed to a new self-confidence on the part of many Greek people, and certainly among Greek companies. There’s been a significant increase in tourism arrivals, particularly from “new” markets such as Asia and America. Hotels in Athens, Thessaloniki and a number of other destinations have been renovated and have higher occupancy. The tourism industry is hardly ideal, but on the other hand it’s certainly doing better than that of many other countries.

Finally, I’ve driven over and past sections of the Egnatia Motorway over the years. This road is an engineering marvel, particularly the sections that go from Igoumenitsa to Ioannina and further east over the mountains. The difficulty of the terrain and the need for seismic strengthening have led to a project which is really world class, and I don’t say this lightly. Yes, there have been delays and cost-overruns, but again, passenger and freight traffic is increasing, and the Egnatia Motorway is becoming the major transit link for fruits & vegetables and merchandise between Greece and Europe, as well as its neighbouring countries, notably Turkey.

The article is also full of misleading exagerations. For instance, one sentence states that European assistance has been to Greece what oil has been to the Middle East; the lifeline of poor government, mischievous habits and exasperated hopes. At another point, the article states that in some years, EU assistance equalled up to 3.7% of GDP. Let’s set aside the fact that the energy sector in Saudi Arabia, for instance, is far higher than 3.7% of GDP: according to Wikipedia, the petroleum sector accounts for “75% of budget revenues, 45% of GDP, and 90% of export earnings.”

In fact, EU assistance has totally changed the way the Greek government works. When Greece joined the EU in 1981, it was an economy with a high reliance on low-value-adding sectors such as agriculture, tourism and natural resources, recovering from a disastrous military dictatorship. Its industry was inefficient and protected by tarriffs and opaque benefits, its educational attainment levels low, and its society still very traditional in outlook. EU assistance has helped transform the country, not least of which by requiring a strategic approach towards managing national investment priorities. Yes, of course there have been trade-offs, but EU support has been irreplaceable in helping Greek enterprises, individuals and government authorities adapt to the needs of the emerging global economy.

Since 2000, Greece has supported the Lisbon Agenda, with all the benchmarks and open policy planning this entails. Since joining the EMU, its budgetary process has become much more disciplined and transparent, particularly since the Karamanlis government took power in 2004. There is no comparison between the quality of fiscal reporting in 2008 and 1988 or 1998 – I invite Mr. Linardatos to examine any Ministry of Finance budget and prove the contrary.

Of course, EU assistance could have been used more effectively, but this is not so much the fault of EU assistance as it is the state of government decision-making and patronage politics. To imply that EU assistance causes agricultural protests, teacher demands for higher pay, or demands of other interest groups is disingenuous, particularly since the EU promotes the very competitive framework that Mr. Linardatos purports to support, not least within its own borders.

Again, I wonder where the logical implications of this article take us. Should Greece reject EU spending? Should we aspire to return to the era of the Periclean city state, when slavery was common, women were disenfranchised, and political power was held by a narrow, property-owning elite? Has Mr. Linardatos read Thucydides’ Peloponnesian War or Herodotus’ Histories in their entirety, or only Pericles’ Funeral Oration? Has he heard of the slaughters of Corfu, Naxos, Sepeia, Heracleia, Tyre, Gaza or any of the many other such incidents in our long and bloody history?

Indeed, I am afraid that Mr. Linardatos may perhaps be spending too much time in the ivory tower of some Brussels think tank, excessively influenced by classical US conservatism, to see or understand what is happening in Greece today. Surely, things are not ideal, but as someone who has owned companies, lived and worked in the US, France, Germany and Greece, I am quite confident that the situation here is improving, and is in fact competitive in many more ways that we readily credit. We – as citizens and residents of this country – would do better to roll up our sleeves and see how we can contribute, rather than steep in a misplaced sense of bitter nostalgia and intellectual incoherence.