Greeks Bearing Brunt of Merkel-Led Austerity Blame Own Leaders

Photographer: Krisztian Bocsi/Bloomberg

A photograph of German Chancellor Angela Merkel is seen on a television screen during her final election rally in Berlin, on Sept. 21, 2013. Victory for Merkel will mean a third term governing Europe’s largest economy, and effectively a second overseeing its weakest. Close

A photograph of German Chancellor Angela Merkel is seen on a television screen during... Read More

Close
Open
Photographer: Krisztian Bocsi/Bloomberg

A photograph of German Chancellor Angela Merkel is seen on a television screen during her final election rally in Berlin, on Sept. 21, 2013. Victory for Merkel will mean a third term governing Europe’s largest economy, and effectively a second overseeing its weakest.

Vangelis Skourtis is hawking perfume to shoppers on Ermou Street, within sight of the Greek Parliament in central Athens. As Germans prepare to vote this weekend, he’s trying to raise enough money for a boat ticket back to his island of Rhodes.

“Merkel?” said Skourtis, 31, among the record 1.4 million Greeks without a job. “She destroyed us, but she’s not to blame. Who is? Walk up the street. You’ll find them up there.”

Victory for German Chancellor Angela Merkel will mean a third term governing Europe’s largest economy, and effectively a second overseeing its weakest. One of her first tasks will be deciding on increasing the financial rescue for Greece, whose debt keeps the nation reliant on German hand-outs.

A new round of meetings will begin in Athens between Prime Minister Antonis Samaras’s government and the inspectors from the European Commission, International Monetary Fund and European Central Bank tomorrow, the day of election. Quarterly reports from that troika since May 2010 have wielded the power to cut off funding should targets not be met, spending not be cut and revenue not raised.

“Indifference is the main feeling,” said George Tzogopoulos, a researcher at the Hellenic Foundation for European and Foreign Policy. “Ordinary Greeks don’t expect any dramatic change in Berlin’s policy on Sept. 23.”

Indulgence

Germans have paid the bulk of the 240 billion euros ($319 billion) of rescue funds pledged to Greece since 2010.

Wage and pension cuts in return for the money that staved off a financial collapse has led to six straight years of recession and, at 28 percent, the euro area’s highest unemployment rate. Merkel told supporters this week she will continue to extract concessions from the region’s indebted nations if she’s re-elected.

“I’m firmly convinced that we won’t make Europe stronger - - Europe has to emerge stronger out of this crisis -- if we’re too indulgent with one another, if we can’t rely on what we’ve promised to do,” Merkel said.

In a poll published yesterday by Public Issue in Athens, 47 percent of Greeks believed the re-election of Merkel will have a “somewhat negative” effect on Greece’s interests, while 34 percent expect neither positive nor negative impact. Eight in 10 people had a negative opinion of the chancellor. No margin of error was given for the poll of 1,000 people.

Be Flexible

George Kapsis, 50, who runs a shoe store on Ermou Street, said Merkel shouldn’t be elected because her vision of a strong euro will “destroy all Europe.”

“It’s too hard, too expensive,” he said, leaning over to show how a shoe is flexible, how the leather can move with the foot. “It doesn’t do for the countries of southern Europe. It needs to be more flexible, like the dollar.”

Merkel, 59, won her last German vote in September 2009, a week before George Papandreou prevailed in Greek elections. Taking over as prime minister, he proceeded to disclose to his European Union partners that the country had a budget deficit that was four times the limit allowed, triggering a debt crisis that spread to other parts of the euro region.

As Merkel tells her electorate that her stewardship has kept Germany’s unemployment near a record low -- at 6.8 percent last month, it was a quarter of Greece’s rate -- Irini Papadaki recounts a story of her friend in Athens who has been hunting for a job since finishing her economics degree.

Lucky Florist

Papadaki says she’s luckier than her friend who can’t find any position, not even as a shop assistant, in a country where nearly six in 10 Greeks aged 15 to 24 are out of work.

“I have a job, a family and my health,” said Papadaki, 23, who just opened a florist’s shop in central Athens with her boyfriend, Michalis. “A lot of people can’t say the same.”

Greeks have had three changes of prime minister since Papandreou’s Pasok party won on Oct. 4, 2009. It is 15 months since current premier Samaras cobbled together a coalition government, which ended a political stalemate that had led to speculation the country could be forced out of the euro.

The hail of austerity measures since 2010 has taken its toll on Greek faith in the political system and in the EU and the euro. A Public Issue poll for Skai TV in Athens released on Sept. 11 showed that support for the euro among Greeks fell to 51 percent from 67 percent a year earlier. A total of 76 percent oppose bailout policies, the poll of 1,024 people showed. The margin of error was 3.2 percentage points.

Scapegoat Merkel

A possible budget surplus this year before interest payments, which Samaras hopes will open the way for more debt relief, isn’t resonating with Greeks.

Unconvinced that Merkel’s recipe for economic health is the right one, voters have kept anti-austerity party Syriza head to head with Samaras’s New Democracy party in all polls since the latest elections in June 2012. Syriza leader Alexis Tsipras has consistently blamed Merkel for the failures.

“I read that Mrs. Merkel says she’s not to blame for the problems of the south,” Tsipras said on Sept. 14. “If this was a success she’d be rushing to receive international congratulations. Instead of saying however, ‘congratulate me,’ she says: ‘I’m not to blame’.”

Tzogopoulos, the researcher at the European policy foundation in Athens, said Merkel and Germany have been the “best scapegoats for Greek politicians.”

“They’ve tried to transfer the responsibility to Merkel and Germany of the economic stagnation without acknowledging they only partly applied the bailout terms,” he said.

Greece has held two elections since the last ballot in Germany and had two caretaker prime ministers. The first vote, in May 2012, was a stalemate, with New Democracy scraping a win six weeks later. Support for Papandreou’s Pasok party, which now governs in coalition with its traditional rival New Democracy, polled 12 percent in the June vote.

“We don’t even care about our own elections, much less the German ones,” said Papadaki, the florist. “I don’t fear her.”

To contact the reporter on this story: Maria Petrakis in Athens at mpetrakis@bloomberg.net

To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.