Three years ago, the crisis exploded in the hands of George Papandreou. It was the result, however, of many years of shameful politics. Antonis Karakousis in tovima.gr has described the national failure during the last three decades in a few paragraphs. He wrote (02.03.2013): “In 1981, Andreas Papandreou assumed power promising inter alia to “change things”. Change actually did occur, some of those promised were delivered, but most of his policy announcements remained unfulfilled or proved ineffective. A part of the electorate was surely satisfied; however Papandreou failed to boost the economy or achieve significant progress for the country.

The real change was attempted after 1985, when his economic policy had collapsed and he had to endorse that of the European Union, which provided funding and rescued the economy. Then the Stabilisation and Growth Programme developed by Costas Simitis – then Economy minister – attempted the first big steps to exercise control over public finances. That 3-year project was based on the slogan “We spend more than we produce.”

Karakousis noted: “During the first year the programme was implemented by Costas Simitis, harsh measures were decided that caused a lot of reaction. In the second year, some elements of growth started to appear. The third year of the programme was about streamlining public finances. At the end of 1987 the field was dominated by debates on the budget, taxes and tax evasion. Finally, Papandreou expelled Simitis and the crowd was satisfied because the “heartless” Minister of Finance was gone. Later on, in 1988 the scandals dominated public agenda and public finances derailed. In the elections of 1989, Papandreou maximized clientelism practices and soon after deficit’s revenge came. In early 1990, the Greek state had run out of money and started borrowing with a 27% rate in order to pay salaries and pensions.

The next effort to consolidate fiscal finances by Costas Mitsotakis was not concluded due to political reasons. Then, another effort by FinMin Alekos Papadopoulos in 1994 got lost three years later in 1997 due to populist notions that prevailed in the then leading political class. Since then all efforts undertaken were incomplete and have failed, hence today’s near-bankruptcy situation…”

A similar analogy (to include also a few more PMs not previously mentioned) can be simply put as follows: deficits – clientelism – more deficits – populism – missed opportunities – timidity – political amateurism.

For foreign technocrats and scientists, Greece is a mystery. When the working hypothesis necessarily assimilates the country’s Eurozone membership, the analysts’ despair grows even further; in their minds, disaster scenarios are almost a certainty. Of course, those Nobel laureates who promised investors the bankruptcy of Greece proved to be quite wrong. Recently, one of them was forced to admit publicly that the assessment was incorrect. But was it?

Scientifically speaking it was not wrong, since, no matter how one makes the calculations, the figures “do not add up,” despite Stournaras’ confidence that within the year, or early 2014, there will be a primary surplus. What does this mean? Nothing more than that Greece will stop borrowing money to live. What follows is the need for a rapid reduction of debt, which if not achieved via a new haircut, it requires a spectacular GDP growth over the next ten years or so.

Nobel laureates and domestic politicized economists (Stournaras, Milios, Varoufakis and others) probably acknowledge that achieving such a GDP jump is a mission impossible for a country in which the ruling party of the day considers citizens (and their occupations) as election target groups and reigns depending on the electoral cycle. Moreover, this time, growth will not come from increased consumption of indigenous buyers. This is over; credit cards with predatory interest rates, and seasonal consumer loans that in the past have fueled the market and Greek banks’ easy profits are obsolete.

Growth will emerge from serious and innovative investments that can attract quality visitors (on a seasonal or permanent basis) and produce goods and services that target foreign markets. This effort requires the use of the well-known ‘comparative advantages of the country’, and involves novelty, originality, design, and communication effectiveness.

All these are not associated with ideology (to exclude the communist fairytale). The whole case is simply a matter of efficiency, in order the country to be able to exploit its comparative advantages, which -fortunately- are largely independent from the actions of Greeks. The rest is shoddy propaganda stemming from vested interests or originating from the need for group psychotherapy within party walls, depending on anyone’s prism.

The way out of the vicious circle of deficits, failure and inefficient politics require drastic solutions. It mainly requires a large proportion of Greek politicians to decide to sacrifice themselves on the altar of crisis management.

This will be the beginning of the end of the Greek problem.

Dr. Demetris Kamaras is the Editor of Alyunaniya.com

They both assumed the leadership of their historic parties at the end of different political eras, thus both had the opportunity to enter the mainstream on their own pace and mark their way towards the top, i.e. the Premiership of the country. They both succeeded, through quite similar paths.

George Papandreou assumed the leadership of PASOK from his father’s adversary Costas Simitis who led a reformist movement that delivered much less than it promised. The latter’s landmark moment was Greece’s accession in the EMU, something that ten years later many Greeks considered a drag. Now it is clear that, although many euro area members may have doctored their statistics to fit the Eurozone dress, Greeks ended up embracing the scheme, building up our very own fallacy.

This is not of the last decade’s however. Systemic malfunctions were built back in the 1980s when Andreas Papandreou institutionalised budget deficit as a national policy. In the years that followed, all signs pointed towards a looming ending. Even the new FinMin Yannis Stournaras, when he was taught economics by legendary academic Constantine Drakatos, he already knew that there was not even a chance traditional Greek-style economic policy to prevent the national economy from taking a fall. Short periods during which the fundamentals of the economy were turning towards the positive, due to increased consumption and internal borrowing made nothing than deteriorating the misleading notion of progress.

During Karamanlis 2004-2009 governance, the countdown of this era began. Admittedly, it was the first real opportunity Greece had to change course and move away from the destructive path drawn by party politics, corruption and extreme clientelism. It was a period during which Greek economy’s tremor started; most importantly, it was a period during which Greeks lost the last remaining iota of trust towards Greek politicians.

This opportunity was lost. During the Karamanlis administration, Papandreou has been very difficult as an opposition leader, putting up strong fights against the then Prime Minister and the centre-right administration, who had adopted a minimum risk approach that turned it into a sitting duck. If Karamanlis government had a slim chance to produce tangible results, G. Papandreou’s populism killed it. That period will be recorded in Greek history as a period during which the country kept burning several billions of borrowed money, next to torched forests and Athens historical buildings that went ablaze in the 2008 riots.

Then, in October 2009 George Papandreou became Prime Minister and Antonis Samaras picked up the conservative party in ruins.

It was at that moment when the God of Greece turned George and Antonis into two sides of the same coin, in a process sometimes known as “Schumpeter’s gale.” Economic history tells us that Austrian-American economist Joseph Schumpeter adapted it from the work of Karl Marx and popularized it as a theory of economic innovation and the business cycle. At its most basic, “creative destruction” describes the way in which capitalist economic development arises out of the destruction of some prior economic order.

Both stages are essential in order to reach the end game, which in the case of Greece has to do with the drastic transformation of they way we do things in the country; economic and business mentality, social interaction and development, individual and collective responsibility and accountability.

George came in for the destruction; to fight the past, impose the concept of change the hard way; widespread pain and horizontal austerity action that shocked Greeks and made them start thinking. He brought into surface all the things Greeks used to hide under the mattresses. Neo-Hellenic illnesses strongly embedded in the daily life of citizens, amongst them what Princeton’s professor Stathis Gourgouris called “a propensity for disorder.”

To fix the Greek economy and conclude the capitalist cycle, major distortions had to go. The destruction process began based on two parametres: 1) things in Greeks’ daily life will not be the same again, since the mother-State had nothing more to give and 2) old incomes and previous generations’ benefits had to fade away to save Greece’s youth.

The process was harsh and George died (politically) in the trenches. Interim procedures were activated with Lucas Papademos stabilizing the field and Panayiotis Pikrammenos neutralizing the political passion.

Then Antonis came in for the second phase, to orchestrate the creative part, stepping on a smoother pathway, after all the reactions, political juxtaposition and pathos were tamed.

Reconstructing Greece requires the ability to synthesise necessary policies through sound leadership. In the creative destruction process, his predecessor delivered the first part and history will have its say. We need Antonis to appear creative and finish the job.

Dr. Demetris Kamaras is the Editor of AlYunaniya.com