This is a direct continuation of the discussion in the previous entry.


Matti Kohonen:

The open letter did of course address further down from the paragraph issues that I would agree with, one of them being that the Greek Crisis is indeed an European crisis. I'm in some general terms a supporter of European integration, and in many ways i'm a living testament of a generation who have greatly benefited from integration, as it seems not at all odd at the moment that being a Finn, I study in the UK, and work in France while paying taxes in Finland, and getting French social security reimbursed from the Finnish KELA. If I fall ill, I have the same rights as national citizens. I vote in the Finnish Parliamentary and Presidential elections, while for municipal and European elections I can vote in the UK as I have a second residence there due to my studies.

It is really this level of personal mobility, career mobility, and the necessary mobility of social and economic rights that I find one of the best achievements in Europe. Europe has the great advantage over many other continents in this regard, but we still lack further integration in terms of fiscal policy, government accountability, and proper anti-corruption efforts (both in private and public sectors). Europe does all too little to advice its citizens of these rights, and help them achieve them. The so-called 'European Information Bureaus' dotted across the Union, are simply propaganda bureaus about EU institutions, where as they should be helping citizens in getting along with their lives.

One of the reasons is that integration costs money, as the Euro demonstrates that in order to have a common economic area that precisely facilitates the moving around of people, companies, and speeding up cross-border flows the price to pay is that we also have to look after the countries and regions who don't benefit enough from this mobility, as mobility goes both ways, this time the rich Greeks have pulled their money in the recent years, and especially months, out of their own national economy.

The Greek Central Bank in an article in the Daily Telegraph is quoted saying that 3 billion euros left the county in January, and 5 billon euros left in February. Assets in the Greek financial system have flown in particular out through HSBC and Société Générale banks that have branches in Greece. From UK housing market to Swiss bank accounts wealthy Greeks are putting their money outside the country.

"Switzerland, the UK and Cyprus have been the largest recipients of the money, with the wealthiest Greeks looking to move their deposits to Swiss banks accounts to escape the more punitive tax measures many fear will be introduced in the wake of the country's economic crisis. " ving-their-money-offshore.html

Both Switzerland and Cyprus are tax havens, so no use looking for unpaid capital gains taxes on the wealth parked offshore. This is a huge greek tragedy! Transaction taxes should be put up immediately for money entering these secrecy spaces.

In February 2010 the Greek Finance Minister, declared that every cash transaction over 1500 euros would be considered as illegal unless declared. This is good but not enough to tackle informality and corruption.

The total Greek banking assets are 245 billion in September 2009, so even relatively speaking in two months, some 4% of all greek assets have been moved away. If the rate continues, Greece would face an Argentinian style capital flight scenario. If it had its own currency, it would most definitively have already gone to a downward spiral, if not already into hyperinflation.

Greek banks cannot be said to be in any way prudent, they have played along with the system of corruption. Corruption in Greece has been rampant, as when Transparncy International surveyed Greek households, 13.5% said they had paid a bribe in that year, on average 1355 euros, ranging from getting a doctor's appointment, a university degree to paying off the tax man to pay less taxes.

This is not an external shock, this is deep corrupting in banking, government and throughout society that caused the Greek Crisis. My answer echoes with what the Argentinians shouted when the Menem government brought down the country "que se vayan todos". I'm sure it's what is already being said in the streets across Greece.

- - - -

Back to the trade union economist. The theory of economic catching up which Greece, Portugal, Spain have done in past 20 years says that it's fine for labour cost to rise as long as it going along with rises in labour productivity. What the ETUI economist is implicitly asking, and this I would support if he were asking it explicitly, is cross-european wage bargaining mechanisms. Meaning that trade unions would start asking for common bargaining across Europe, leading to potentially common european strikes as well.

To tackle corruption, however, EU should have a common prosecution service. This means that a Brussels public prosecutor, when Union public funds are being mispent, or when cases of corruption are being suspected, could simply open an inquiry. The size of the bail-out would justfify the new measure, of giving EU a legal arm to the spending powers of member states. This would be similar to the Government Accountability Office (GAO) in the US, an essential part of handing out Federal funds. 'Checks' size of 120 billion euros should not come without 'balances'.

After the Greek Bankruptcy, we can't say that EU has no common fiscal policy, as we'll be all paying for this for the next ten years. And yes, why not have common labour policy as the ETUI economist points out in his blog. For that purpose, the trade unions should organise collective actions across Europe. Maybe a European-wide collective bargaining, including potential european-wide strikes?

So I do not still agree that the Greek tragedy is a European-wide strategy made in Germany, for this one you can't blame the Germans. It's a Greek Tragedy, made in Greece due to private and public corruption, it has European implications as the Greek currency can't sink as a result, thus bringing down the Euro as a whole. This calls for a bail-out, and as other countries bail out the Greeks they will ask for checks and balances in Greek corruption.


Mikael Böök:

Yes, the trade union economists of the ETUI should ask for cross-European wage bargaining mechanisms. (In my view, they should also explicitely support the creation of European public services such as e.g. a European Post Office.)


"To tackle corruption [... the ] EU should have a common prosecution service" (Matti Kohonen)

So far so good.

But these points lead back to the fundamental European problem: An EU which is no more than a common market and, (partly) a common currency, is a house of cards. A more solid EU has to be built on political and military union. Economists, trade unions and social movements have not proved capable to settle for this federal option.  Apparently, the idea of a free and united Europe is beyond their political horizon. They cannot see how the "nuclear issues" are linked to "the Greek crisis" (which is a European crisis). They believe that the review conference on nuclear proliferation and the general strike of Greek workers and employees happen in two separate worlds, which are not causally connected to each other.

And yet these seemingly separate worlds of economics, politics and society are closely interlinked. Is it possible to understand the economic development, including its criminal dimensions (e.g. the tax evasion of the banks and the millionaires,  and other types of financial crime) without taking into account that the present world economy is, generally speaking, a 'permanent war economy'? Can you get a true picture of the economic corruption and bribery, if you turn your eyes from the military-industrial-academic complex?

"Greece remains among the top five largest recipient of major conventional weapons for 2005-2009, but has fallen from third place for 2000- 2004. The transfer of 26 F-16C from the United States and 25 Mirage-2000-9 combat aircraft from France accounted for 38 per cent of the volume of Greek imports."


<i>Thirty-eight per cent!? </i> How do you relate this astounding figure from the Stocholm Peace Research Institute SIPRI to the Greek financial and budgetary crisis? How much of the famous Greek national debt, which all and everybody are now talking about, is owed to the banks, which financed the military procurements of the various Greek governemnts? Which banks, and in which countries? How many of the millions, which the Greek millionaires have by now moved into safer havens, did they earn through arms transfers? How much did ministers and employees get in the form of bribes and commissions?

Can there be tax justice as long as we have a permanent war economy and a military-industrial-acedemic complex? Is a sound financial system compatible with weapons of mass destruction? Are those persons who decide about the solutions to the Greek crisis any other than those who decide about the nuclear proliferation? Here is a timely quote from the Carnegie Endowment for International Peace:

"The United States spent over $52 billion on nuclear weapons and related programs in fiscal year 2008, but only 10 percent of that went toward preventing a nuclear attack through slowing and reversing the proliferation of nuclear weapons and technology. That is the main finding of Nuclear Security Spending: Assessing Costs, Examining Priorities, a new study that uses publicly available documents and extensive interviews with government officials and experts to calculate the U.S. nuclear security "budget." (

President Obama may be serious about moving towards a world without nuclear weapons, but we need give him a helping hand and act together for the unilateral denuclearization of Europe.That is also absolutely necessary if we want to achieve social and economic justice.

I suppose that the ETUI economists support the demands of the Greek workers and employees who start their general strike tomorrow. At least I do.