Monday, March 21, 2016

A To-Do List For Greece

The EU Commission published this press release on the EU-Turkey Agreement. It is a very interesting document because it clarifies several of the questions which many people undoubtedly have. Such as: What will happen to the refugees already in Greece? Answer: They will be relocated to other countries, at least 20.000 by mid-May.

Where the Agreement becomes overwhelming is where it stipulates what Greece needs to accomplish. Below is an extract:

The Commission estimates that Greece will need:
Around 4,000 staff from Greece, Member States, the European Asylum Support Office (EASO) and FRONTEX:
  • For the asylum process: 200 Greek asylum service case workers, 400 asylum experts from other Member States deployed by EASO and 400 interpreters
  • For the appeals process: 10 Appeals Committees made up of 30 members from Greece as well as 30 judges with expertise in asylum law from other Member States and 30 interpreters
  • For the return process: 25 Greek readmission officers, 250 Greek police officers as well as 50 return experts deployed by Frontex. 1,500 police officers seconded on the basis of bilateral police cooperation arrangements (costs covered by FRONTEX)
  • Security: 1,000 security staff/army
Material assistance:
  • Transport: return from the islands: 8 FRONTEX vessels with a capacity of 300-400 passengers per vessel) and 28 buses
  • Accommodation: 20,000 short-term capacity on the Greek islands (of which 6,000 already exist)
  • Administration: 190 containers, including 130 for EASO case workers 

Well, that's a bit more than a piece of cake. I suppose that the EU thought that any country which can pull off one of the greatest Olympics ever could easily handle such a to-do list. 

Let's hope they are right!


  1. Juncker has described it as a Herculean task, only the Greeks can accomplish that.

  2. Thank You Mr. Kastner,

    Although it seems like a lot, much has already been done or in the process of. Especially the accommodations. Some islands municipals are working on there own such as Chios and Mitilini. They already established holding centers meanwhile seeking to increase to assure this crisis on these islands do not affect the tourist season. Some other island citizens are slowing the construction of the holding centers for various reasons. This will be overcome, as the army has greatly contributed to this. As for the personal. Isn't it simple to allocate public workers. Governments love doing this.

    My question is, which countries of the EU will accept the migrants. Will they accept them? Even they agreed? Austria in the meantime as I heard on the radio this morning is seeking to build a fence and increase border controls in Bulgaria now. It remains to be seen if this Austrian way of hard stance will help control the flows and force migrants to be processed properly through this newly established agreement.


  3. Step by step, first things first. Has Athens changed it's asylum laws to recognize Turkey as a "safe country"?

  4. Mr. Kastner,

    I would also like to add something. Aside from the above. The below link is only in Greek but it is from my home island Andros.

    25 Somalians in a boat reached Andros. They were welcomed and cared for and are being processed. But if you take a look at a map of the Aegean, link

    scroll down to G2 map. Find Andros and see how far Turkey and the "hot spots. type islands"

    Supposedly, Nato and Frontex have radar covering day and night the whole northern Aegean. I find it ironic that they were not picked up because even with a small craft from Turkey to Andros in calm waters, which this past weekend had, takes up to 12-16 hours depending on what instruments they had.

    The only logical explanation is that they were given good instruction how to make it even up to Athens. They followed coasts and passed the surveillance and even if they were picked up on radar half way, the NATO and Frontex people may have thought that this was a fishing boat and cant be migrants.

    Anyway, I find it strange that they made it.

    As for the care, the majority of my local islanders took good care of them and continue to do so. Only 1 negative comment.


  5. I find Mish's opinion on the agreement interesting....


  6. "Huge operational efforts from all involved, and most of all from Greece".
    Greece signed it, so stop whining and get on with it.

  7. This deal has got "Merkel" written all over it. The complexity, the eye for boring detail, the ability to find common ground where it's invisible to anybody else. The ... unscrupulousness / pragmatism (delete as desired).

    There's so much about it that can go wrong. And yet, if it works?

    She really is remarkably gifted as a diplomat.

  8. The agreement is not only illegal, and deliberately crafted to evade the courts, it is also absolutely ridiculous. Greece has almost no functioning legal system at this time, with lawyers on strike, and the backlog of cases is horrendous. It does not have the capacity to handle even one quarter of the expected refugee flows, cannot send anyone back to Turkey without due legal process, and there is no way that this can be changed in less than a matter of a year or more.

    The only way that it could work, is if Greece becomes a colony of the EU and democracy is abandoned in Greece. That will not happen.

    Therefore, the logical conclusion is that the agreement is not supposed to work. They have handed Tsipras a poisoned chalice, with two choices. If he drinks it, then he has to pass a new asylum law that will breach all European laws and allow refugees to be returned to Turkey. Perhaps. If he doesn't drink, then Greece will just fill up with refugees that Europe refuses to relocate (as they have done, up until now). In the former case, the Germans will just play dumb when this is denounced internationally, and in the European courts, and blame it all on the Greeks.

    From the outset, Tsipras should have set out his terms, and when the Germans refused to keep to their commitments (as with the eurozone) Greece should have abandoned EU politics and gone to the UN, asking for a global summit on the refugee crisis -- since Europe is incapable of doing anything to solve any problems.

    This is also the only way to deal with Germans, I am sorry to say: there is no possible negotiation, power is the only thing that they respect. The EU has been seriously let down yet again by two German nation states.

  9. @ Anonymous, March 22, 12.44 AM.
    Why would anybody, so unhappy with the EU, stay a club member.

    1. For the same reason that Greece celebrates "Oxi-Day" when the government in 1940 refused to allow Mussolini to walk into Greece. There is a difference between right and wrong: again, Germany has pushed the EU into going in a bad direction. It is a sad time for humanity and the rule of law.

  10. Sad day for europe. May the innocent good people rest in peace.


  11. And then, predictably, it happened. 3 days after the PM declared the agreement between Turkey and the EU a Greek victory, the spokesperson for the government inform the press that Greece will not nominate Turkey as a "safe nation". She is not telling us how she expect the Greek judges to expel migrants. They, on the other hand will try to unload it on the assisting judges from other countries, who do not have jurisdiction in Greece. But, Keep Talking Greece, it helps to pass the time.

    1. It is far from clear what the Greek government is doing with this. They have merely stated that they will not legislate Turkey as a safe country; it does not mean that they will not recognise it as such.

      Moreover, given that the entire world (apart from the overpaid lawyers in the European Commission) believes the EU-Turkey deal to be illegal and unacceptable, it is not reasonable to ask Greece to be the country breaking international humanitarian law. If the Council of Ministers wants to do it, then let them legislate and see what happens. They don't have the balls to do it, because they know that they will be hung out to dry by all the European courts and also humiliated by the Parliament. No, much easier to put all the burden on Greece...

  12. @ Anonymous March 23, 10.24 PM.
    If you said OXI to the EU you would not have to put up with the Germans, you would live in your own right Arcadia. You would not have to correct the wrong behavior of the Germans or Europeans or the world at large. That the world would miss out on what Greece could have taught them will be their own fault. You would not have to feel embarrassed for letting the world down.

    1. You appear to be unfamiliar with the political and legal architecture of the European Union. You also choose to ignore the painful fact that once a country has handed over its central bank and assets to the ECB, there is effectively no way to regain monetary sovereignty. This was explained very carefully, and very well, on a number of occasions by Varoufakis. It seems that a lot of people are incapable of grasping basic points.

      By the way, you know where you can stick your arrogant sarcasm.

  13. It is far from clear what the Greek government will do about anything, including the migrants.

  14. @ Anonymous March 24, 1153 PM.
    That Greece cannot leave the EU is a myth (lie) that many Greeks tell each other. The reality is that Mr. Schauble offered to terminate the membership in mid 2015, with a generous alimony. I am sure he would be willing to renew the offer.
    Why would some Greeks claim they can not leave? One reason could be that they don't think they can go it alone, but do not want to admit it.
    Any other suggestions?

    1. If you are actually naive enough to think that Schaeuble is capable of "generosity", then clearly your grasp of reality is not strong. Equally, a country that cannot balance its income and expenditure -- which is the case after 5 years of German and IMF mismanagement of the Greek economy -- is not able to establish a new currency and trade with it. This exit would be a rapid road to the complete political and economic collapse of Greece -- something the Germans would like to distance themselves from, despite having caused it.

    2. Of course, any country can leave the EU (see Great Britain at the moment). It is the EZ-exit which is not provided for in the treaties (voluntary or involuntary). Only if one first left the EU, would one then - automatically - leave the EZ.

      Your thesis that Germany caused the complete political and economic collapse of Greece is interesting. Varoufakis would consider you a good student.

  15. Apparently we agree that Greece can leave the EZ, but that it would be more painful to go it alone.
    As for who/when of the lousy balance between the income and expenditures, I don't think we will agree.
    If I understand you right you think that it was caused in the period from 2010 to today, because Germany (Schauble, IMF etc.) had an influence on Greek economic policy in that period.
    But when I look at the figures from 1980 to today I see 2 distinctive periods.
    The period from 1980 to 2010 when that balance deteriorated dramatically, and where Greece had total sovereignty in her economic policy.
    The period from 2010 to today when that balance improved dramatically, and where Greek economic policy was influenced by the EZ and IMF.

    1. What you describe is the classic error of anti-Keynesian economics -- finding more virtue in a collapsed economy with a balanced budget than in a growing economy with fiscal deficit. The mistake that Greece made was in joining the eurozone, with no attention paid to trying to control both private and public sector expenditure (the former through taxation and regulation policies)or any sort of economic development policy relating access to cheaper capital (again, the need to avert consumption expenditure and promote investment).

      In the wake of the eurogroup control over the Greek economy, there were two broad options: either salvage the Greek economy and damage the private banks in Germany and France, or salvage the banks and destroy the Greek economy by sucking out money from it. They chose the latter course, dressed up with economic nonsense about "reforms" of the Greek economy, and blah blah. A lot of people have been fooled by this sleight of mouth, including Klaus. There was never any serious intention let alone plan to salvage the seriously distorted Greek economy.

    2. @Anonymous at 4.25 pm
      Perhaps I have been fooled but the fact of the matter is that no money has been sucked out of the Greek economy by lenders. In fact, Greece's lenders have put well over 50 BEUR into the Greek economy since 2010 (financing of primary deficits, bank recaps, etc.). Even the deposit flight by Greek savers was replenished with funds from abroad. So I suggest you check your numbers.

      What you suggest about deficit spending would apply in a rather balanced economy. Greece's economy, by 2009, had been reduced to a turn-table for money flows: money came in as debt and left the country to pay for products and services. Any fiscal stimulus in such an economy would only stimulate the economies of those countries where Greece imports from.

      That logic is just so simple that one wonders why rockstar economists simply refuse to understand it. If an entire economy prices itself out of the world market and if they stop producing because it is so much easier to import, then this house of cards will collapse the moment the foreign funding stop. And the music stopped in late 2009 / early 2010.

      People like Varoufakis understand this, of course, but they play cheap games. They know that Greece will only pick up if money for investment flows into the Greek economy. But instead of openly stating that Greece must set the conditions so that such money flows voluntarily, they concoct all sorts of schemes and/or modest proposals which suggest that it is the foreigners responsibility to send money to Greece. And as longs as that game is being played, Greece will not improve much.

    3. Klaus: you think and argue like a banker, not like an economist. The concept of "sucking money out" of an economy does not exist in economics -- simply because the condition of ceteris paribus does not apply.

      The fact of the matter, which you refuse to face, is that the financial viability of private sector banks was put before the functioning of the Greek (and other eurozone) economies. You bankers think that a good thing -- looking after your own. Economists and ordinary people do not share that view. Ibn my view, major banks should have been allowed to fail -- as opposed to economies that sustain millions of people.

      Moreover, the Greek economy did not "price itself out of world markets". Again, this is not how economists argue. The Greek economy was badly damaged by eurozone membership, which had the effect of being priced out of world markets. Nobody made that decision, with the possible exception of the French and German politicians who were so keen to bring Greece into the EZ.

      As for your comment on Varoufakis' Modest Proposal: you know full well that it is seen as an interim measure. The EZ crisis is the result of irresponsible and reckless political interference in markets, followed in 2010 by policies motivated by powerful vested interests (banks). There is no way that Greece can recover within a free market framework: nor should it be expected, as all of these problems are the result of political mismanagement and interference with markets. Some of the fault lies with Greek politicians, but the greater part lies with the EZ mismanagement, its non-accountability in law, and its clear corruption and alliance with powerful interests.

    4. Begging your pardon, I wish you would stick to your line. I picked up the line "sucking money out of the economy" because you introduced that falsehood.

      If you would only read up on Keynes a bit, above all his book "The economic consequences of the peace". Or read "The battle of Bretton Woods" in which Keynes was a key player. Then you would better understand that, at the core of each and every sovereign payment crisis, there is a Balance of Payments situation. Greece was, if you wanted to reduce it to only one cause, a Balance of Payments problem. Greece was/is not unique at all, despite all national efforts to portray Greece as a unique case of victimhood. Since 1945, there have been over 70 BoP problems which led to default and debt restructurings. So Greece is one of over 70 cases since WW2.

      It is ridiculous to argue that the financial viability of private sector banks was put before the functioning of the Greek economy. You may want to review the "major contents of this blog" on the right-hand side. Then you will find that, from the start, I have argued that the banks should not have been bailed-out via Greece but, instead, directly. Not because it would have made any difference for Greece but because it would have made a world of difference to the tax payers of the financing countries: they would now have part-ownership of banks instead of worthless claims against Greece.

      To Greece, the chosen form of bail-out made exactly zero difference. The debt was there and that debt would not have disappeared or even changed if all lenders had gone bankrupt. You ought to understand that a "change of lenders" has absolutely nothing to do with the amount of debt owed. That is banking 101!

      You are wrong when you make membership in the EZ the primary culprit. It was the membership in the EU, with its 4 freedoms, instead. Greece was certainly not able to handle the freedoms of capital flows and of trade. That is why the major destruction of what little Greece had by way of a productive sector took place in the 1980s and 1990s and not in the 2000s. Just travel Greece's industrial graveyards and ask when the companies went out of business. Already in 1993, Varoufakis said in an interview that "the Greek economy is in a condition of terminal decline". All that the Euro did was to put a turbo to a destructive development which had mostly taken place already.

      Read "The 13th labor of Heracles" and you will understand how 30 years of brutal misgovernance ruined the country. If nothing else, the EZ has so far made sure that Greeks would lose none of their savings (without the EZ, they would have lost all of them, and still more). "Thank-you" might be an apt reaction.

      Where I agree with you is that do not believe that Greece can handle all 4 EU freedoms. At least temporarily the free movement of capital, products and services must be curtailed. That, too, you will find in the major contents of this blog.

      But the overall point is: if Greece had continued to be governed as sensibly after the EU joining as it had been before it, then Greeks might live in mild and honey today. Andreas Papandreou and his PASOK started the demolition of responsible governance and ND only copied them in periods when they came to power. Here you might want to read the book "The history of modern Greece" by Prof. Kalyvas.

    5. Klaus: you reveal clearly your lack of education on the standard theory of monetary integration. Greece did not have a b.o.p. problem prior to joining the eurozone. Everything that happened with the operation of the eurozone is predicted by standard theories of monetary integration dating from the 1960s and 1970s. Germany did well, and Greece was plunged into economic crisis.

      At the point of that revelation, northern EU powers had the choice of saving Greece or saving their own banks. They made a clear choice, which was to suck money out of Greece through high taxation (a balanced budget could guarantee that) and by socialising the private bank debt and enforcing it through political power of the eurozone.

      You can bleat as much as you like, but private banks should have been allowed to go bankrupt. No, they should not have been bailed out directly, they should have failed.

      In all of this discussion, your personal and class interests are evident. My position is much more independent, as I am neither a banker nor a Greek. Greece was sacrificed for private banking is a very clear conclusion that indepnedent analysts everywhere have reached.

      AS for stuff written by Kalyvas, please .. spare us the anti-Pasok propaganda. Kalyvas is no economist, and is not competent to make such claims. Papandreou did a reasonable job in the early 1980s, and more or less did nothing afterward. Nor do I accept that Greece was governed "sensibly" prior to 1981! What nonsense you write. Greece never had industrialisation, was always dependent on state-client relations or patronage.

      There are plenty of criticisms one can make of Greek economic management, but the crucial one was joining the eurozone. This came from the political elites of Europe, who engaged with the corrupt greek political elite. YOu know many of those people personally, and don't want to hear that they are corrupt. This is your problem -- a closed mind to the reality.

  16. Was there ever a serious Greek plan to "salvage the seriously distorted Greek economy?" Such as creating a business friendly environment that would attract investment.

  17. The time is drawing close, Greece has now changed its asylum laws to facilitate the expulsion of some migrants. One would suppose that responsible volunteers are lining up to sign the first expulsion orders?
    We are going to see the biggest show of "passing the buck" on Monday.

  18. Coming back to this issue, there are lots of teething problems in the execution of the EU/Turkey deal(which is not at all surprising).

    "According to the latest statistics, migrant flows into Greece saw a sharp decline yesterday as no arrivals were recorded on the islands of the northern Aegean (Lesvos, Chios and Samos) for the first time in months."