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Reforms and dignity

Joanna Kakissis, AthensJune 23, 2015

With its back to the wall, the Greek government may have done enough for now to secure a deal with its creditors. But as Joanna Kakissis reports from Athens, a wave of the magic wand won't fix the long-term problems.

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Image: Reuters/Y. Behrakis

Kostas Sinodinos is 31, has an advanced degree in international relations, but, like most Greeks, has had trouble finding work. He supports himself by making miniatures for collectors. The last five years have been rough, mainly, he says, because corrupt politicians bankrupted the country, then sold it out to European lenders in exchange for ridiculously punitive austerity measures that killed the economy.

"The previous governments," he said, "used to go to Europe and then return like five minutes later with a new agreement. Now, with this new government, it's been five months and we don't have any new agreement. This is the way negotiations are supposed to be - tough."

But even though the standoff has pushed Greece to the brink of default, Sinodinos says he absolutely wants Greece to remain in the eurozone. "We made sacrifices before the crisis," he said. "We cannot just leave, because we will collapse and the whole system will collapse with us."

The anti-austerity Greek government, in office for barely five months, is hoping that European and International Monetary Fund creditors see the fate of the eurozone and Greece as interlinked. Prime Minister Alexis Tsipras says his leftist Syriza party is pro-euro and that he wants European heavyweights like Germany to see that austerity policies kill economies and divide nations.

Tsipras' government has backed away on nearly all of its campaign promises as it has tried to negotiate a deal. The new deal includes increasing taxes on wealthier Greeks and the phasing out of early retirement to help reform the country's unwieldy pension, which is the most expensive in Europe.

Messy default

Greece needs a deal this week because it's dangerously low on cash. The government says it cannot make a 1.6 billion-euro debt repayment to the IMF by June 30. If Greece misses that payment, it could be plunged into a messy default that could trigger a bank run or capital controls and ultimately lead to a eurozone exit.

That's scaring many Greeks. Polls show that most of Greeks want to remain in the eurozone, even if it means more austerity.

protesters holding placards copyright: .(Photo by Milos Bicanski/Getty Images)
The people have spoken - but will Syriza listen?Image: Getty Images/M. Bicanski

"We have to stay in Europe, no matter what," said Yiannis Vlachos, a doctor who attended a pro-euro rally that also served as an anti-government march. Vlachos is a conservative, and he blamed the leftist government for angering the Europeans. "We were following the rules and just getting out of economic trouble," he said. "Now, with these leftists, we have lost everything."

Small business owner Dimitris Yiannakopoulos was at the same rally but said he understood why Syriza had challenged the Europeans. "It's about dignity, our dignity, I understand," he said. "But the government is so inexperienced. They are not getting the Greek message across - the message that we have to reform while staying in the eurozone. I don't know why we can't seem to communicate with those people in Brussels."

Even if Tsipras' government manages to get Brussels to sign off on its proposals, and seal a deal to resume badly-needed credit, he's still facing a fight in parliament - and from members of his own party.

There's a contingent in Syriza that's skeptical of eurozone and even EU membership. And many in Syriza are used to demonizing the Eurocrats of Brussels, not compromising with them. Alexis Mitropoulos, a Syriza lawmaker told Greece's MEGA TV that any deal "is difficult to pass by us."

Like a prison?

It might also not sit will with euroskeptics who support the government. There were plenty of anti-EU signs at a pro-government rally last week, where 25-year-old student Zanetta Liskatou explained that the "the European Union was good for capitalists here, but for people, it was not good." Another protester and fellow student, Thanos Likourias, said the euro was like a prison. "You can have a lousy life with euro and with drachmas," he said, referring the Greek currency before the euro. "It's not just about the currency. It's about who controls power."

people carrying euro notes copyright: ARIS MESSINIS/AFP/Getty Images
Another nail in the coffin?Image: Getty Images/AFP/A. Messinis

Sinodinos, the miniatures designer, had attended the pro-government rally and also decided to "infiltrate" - as he called it - the pro-euro rally. He wore a Clash T-shirt, standing out amid the perfumed crowd of pressed suits and designer dresses.

"I wish they could see that we all want the same thing - a clean government that doesn't cheat its people and a healthy economy in the eurozone, not out of it," Sinodinos said. "This deal,is not going to be something like a magic wand. It's just a beginning, so we can create something stable and move forward in the future."