No Reforms, No Cash: How Euro Bailout Conditions Would “Re-create” Modern Greece

The euro zone countries and the IMF are now making it clear to Greece: bailout cash will only come after the kind of drastic reforms that would effectively transform Greek society. But are the measures too drastic to make it possible?

Her future at stake (George Laoutaris)
Her future at stake (George Laoutaris)
Stefanie Bolzen and Florian Hassel

BERLIN - Before international lenders free billions of euros in credits to Greece, its government must see through groundbreaking reforms – that's according to the new loans package Greece agreed on last Thursday with the E.U. Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF). The program was approved on Sunday by the Greek parliament.

Die Welt obtained a copy of the 51-page document, which is dated Feb. 9, 2012 and entitled Memorandum of Understanding on Specific Economic Policy Conditionality. Compared to the other bailout agreements signed up until now, the terms this time are much, much sharper. If implemented (Athens may end up declaring bankruptcy before it can be) it could lead to a virtual overhaul of the Greek economy and a remaking of its society. Some of the contents of the program are the equivalent of social and political dynamite.

Greece needs to get its hands on more money by March 20 at the latest. That's when Athens has to pay back loans amounting to 14.5 billion euros. This is money that Greece doesn't have.

According to what is set out in the memorandum, Athens not only has to implement various spending cuts amounting to some 3 billion euros, but must meet a Wednesday deadline set by euro country finance ministers outlining where it will make an additional 325 million euros in cuts. Particularly explosive is the issue of blocking at least 300 million euros worth of government payments to pension funds running deficits, and making radical reforms to the pension system, before the first payment of the new loan program is made. All pension funds are to be joined together, with costs and staff reduced by 30%.

Pension cuts will affect some 3 million of Greece's 11 million inhabitants. Chronic deficits in both social and pension funds are one of the major reasons for the country's present misery. According to Greek Minister of Labor Giorgios Koutroumanis, there are currently 2.73 million Greeks making payments to social security and 2.76 million pensioners.

Crackdown on tax evasion

By the end of June, Greece has to make further cuts in social, health, military and administrative spending. In order to be able to reduce the budget deficit as promised, according to government sources, these must add up to some 10 billion euros – three times the cuts outlined in the current program.

But before receiving the next loans, Greece will have to do away with amnesties for tax cheats and sharpen and speed up legal procedures for evaders. Back taxes of more than 10,000 euros for individuals and 75,000 euros for companies can no longer be paid in installments but must be paid right away. By the end of June, the country must have cleared up half of all open tax cases, and the rest have to be dealt with by the end of August 2013 at the latest.

Also, before it can receive the first loans under the new agreement, the country must liberalize certain sectors -- by presidential decree or ministerial decision that cannot be overturned by parliament -- thus opening them up to competition. This would impact hospitals, pharmacies, opticians, bookkeepers, real estate agents and taxi drivers, among others.

By the end of June, hiring a lawyer for certain transactions like buying a home will no longer be required, and lawyers' fees will be cut by presidential decree. Furthermore a number of segments of the economy will have to open up to foreign competition. By that date, all E.U. citizens and companies should be legally entitled to open and run a gas station, a transport company or a railroad line. The energy sector will be opened as well.

"Mid-term," Athens is expected to bring in 50 billion euros through privatizations, with 39.2 billion euros in state coffers by the end of 2015.

The E.U. Commission is cautiously optimistic about the new austerity package and its approval by Greece's party leaders, cabinet and parliament. E.U. Commissioner for Economic and Financial Affairs Olli Rehn stressed that Greece's political parties would be required to agree in writing to continue to implement the austerity and reform program after possible elections in April.

Some Greek politicians, notably Antonis Samaras of the leading New Democracy conservative party, have been saying that after elections they would renegotiate the terms of the loans, which goes against both the expectations and the understanding of the lenders.

"We expect clear agreement before the next election campaign begins," Rehn told Greek conservatives. "Mr. Samaras gave his approval to the program before the parliament and before all Greek citizens." He added that Greece had been "living above its means for over a decade." A lot is being asked of its citizens now – but there is no other path to growth and stability, he said.

Read the original article in German

Photo - George Laoutaris

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!

How Thailand's Lèse-Majesté Law Is Used To Stifle All Protest

Once meant to protect the royal family, the century-old law has become a tool for the military-led government in Bangkok to stamp out all dissent. A new report outlines the abuses.

Pro-Democracy protest at The Criminal Court in Bangkok, Thailand

Laura Valentina Cortés Sierra

"We need to reform the institution of the monarchy in Thailand. It is the root of the problem." Those words, from Thai student activist Juthatip Sirikan, are a clear expression of the growing youth-led movement that is challenging the legitimacy of the government and demanding deep political changes in the Southeast Asian nation. Yet those very same words could also send Sirikan to jail.

Thailand's Criminal Code 'Lèse-Majesté' Article 112 imposes jail terms for defaming, insulting, or threatening the monarchy, with sentences of three to 15 years. This law has been present in Thai politics since 1908, though applied sparingly, only when direct verbal or written attacks against members of the royal family.

But after the May 2014 military coup d'état, Thailand experienced the first wave of lèse-majesté arrests, prosecutions, and detentions of at least 127 individuals arrested in a much wider interpretation of the law.

The recent report 'Second Wave: The Return of Lèse-Majesté in Thailand', documents how the Thai government has "used and abused Article 112 of the Criminal Code to target pro-democracy activists and protesters in relation to their online political expression and participation in peaceful pro-democracy demonstrations."

Criticism of any 'royal project'

The investigation shows 124 individuals, including at least eight minors, have been charged with lèse-majesté between November 2020 and August 2021. Nineteen of them served jail time. The new wave of charges is cited as a response to the rising pro-democracy protests across Thailand over the past year.

Juthatip Sirikan explains that the law is now being applied in such a broad way that people are not allowed to question government budgets and expenditure if they have any relationship with the royal family, which stifles criticism of the most basic government decision-making since there are an estimated 5,000 ongoing "royal" projects. "Article 112 of lèse-majesté could be the key (factor) in Thailand's political problems" the young activist argues.

In 2020 the Move Forward opposition party questioned royal spending paid by government departments, including nearly 3 billion baht (89,874,174 USD) from the Defense Ministry and Thai police for royal security, and 7 billion baht budgeted for royal development projects, as well as 38 planes and helicopters for the monarchy. Previously, on June 16, 2018, it was revealed that Thailand's Crown Property Bureau transferred its entire portfolio to the new King Maha Vajiralongkorn.

photo of graffiti of 112 crossed out on sidewalk

Protestors In Bangkok Call For Political Prisoner Release

Peerapon Boonyakiat/SOPA Images via ZUMA Wire

Freedom of speech at stake

"Article 112 shuts down all freedom of speech in this country", says Sirikan. "Even the political parties fear to touch the subject, so it blocks most things. This country cannot move anywhere if we still have this law."

The student activist herself was charged with lèse-majesté in September 2020, after simply citing a list of public documents that refer to royal family expenditure. Sirikan comes from a family that has faced the consequences of decades of political repression. Her grandfather, Tiang Sirikhan was a journalist and politician who openly protested against Thailand's involvement in World War II. He was accused of being a Communist and abducted in 1952. According to Sirikhan's family, he was killed by the state.

The new report was conducted by The International Federation for Human Rights (FIDH), Thai Lawyer for Human Rights (TLHR), and Internet Law Reform Dialogue (iLaw). It accuses Thai authorities of an increasingly broad interpretation of Article 112, to the point of "absurdity," including charges against people for criticizing the government's COVID-19 vaccine management, wearing crop tops, insulting the previous monarch, or quoting a United Nations statement about Article 112.

Juthatip Sirikan speaks in front of democracy monument.

Shift to social media

While in the past the Article was only used against people who spoke about the royals, it's now being used as an alibi for more general political repression — which has also spurred more open campaigning to abolish it. Sirikan recounts recent cases of police charging people for spreading paint near the picture of the king during a protest, or even just for having a picture of the king as phone wallpaper.

The more than a century-old law is now largely playing out online, where much of today's protest takes place in Thailand. Sirikan says people are willing to go further on social media to expose information such as how the king intervenes in politics and the monarchy's accumulation of wealth, information the mainstream media rarely reports on them.

Not surprisingly, however, social media is heavily monitored and the military is involved in Intelligence operations and cyber attacks against human rights defenders and critics of any kind. In October 2020, Twitter took down 926 accounts, linked to the army and the government, which promoted themselves and attacked political opposition, and this June, Google removed two Maps with pictures, names, and addresses, of more than 400 people who were accused of insulting the Thai monarchy. "They are trying to control the internet as well," Sirikan says. "They are trying to censor every content that they find a threat".

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!