Happy anniversary. How about a reform?

Illustration by Manos Symeonakis http://www.cartoonmovement.com/p/6035

Illustration by Manos Symeonakis http://www.cartoonmovement.com/p/6035

It is one year to the day since Greece held its second general election in two months and third in three years. What better way to celebrate the occasion than trying to relive the uncertainty and tension we experienced during the summer of 2012? The leaders of Greece’s three coalition parties go into a meeting this evening with the future of their government less secure than it has been at any point during the 12 months. The cause of their dispute suggests that even if this crisis is overcome, deeper problems lie ahead.

The spark that threatens to burn the house down is the closure of public broadcaster ERT. Prime Minister Antonis Samaras, who ordered the shutdown, suggested over the weekend that the bigger picture in this standoff is that he is a reformer and the others, both in his government and in opposition, are not. But what does he really mean by reform?

His justification for closing ERT was that it was overstaffed, too expensive and a source of corruption. Greece needs a more modern broadcaster, along the lines of the BBC, it has been suggested. All of these things may be true to a greater or lesser extent but there has been no attempt by the government to back this up with any substance, just the standard smattering of platitudes.

For example, if ERT with its 2,700 employees is overstaffed, what would one say of the BBC and the 17,000 it employed last year? In what sense is ERT considered too expensive to run when its costs are covered by the 50-euro annual license fee, which has never been a cause for widespread public discontent? Perhaps Samaras believes this levy is too dear. What would be his view, then, of the £145.50 (171 euros) that British households have to pay for the BBC each year? Indeed, if the point of running a leaner ERT on less than half of the current revenues is to save taxpayers’ money, where is it that the government is hoping this money will be spent: On boosting demand or on the next tax hike? All of these points, though, ignore the essence of public broadcasting, which is primarily to provide a service, not to turn a profit. One only needs to look at the standard of much of private television and radio in Greece to see that public broadcasting is worth paying for. Whether we were getting value for money from ERT is questionable but that’s not the debate we’re having.

There were lots of people at ERT with fat salaries that couldn’t be tolerated, the government argues. Even in the best-run public broadcaster, there will be employees on much more substantial salaries than others. At the BBC, 65 percent of its senior managers earn between £70,000 and 130,000 (82,300 to 153,000 euros) – substantial amounts even by British standards. But then again, if the government is concerned about high earners, especially those on generous wages, why doesn’t it remove them? After all, in many cases, they are political appointees. Reports last week alleged that five people with links to New Democracy, PASOK and Democratic Left were appointed to the executive board of Thessaloniki-based ET-3 TV less than three weeks before the broadcaster’s closure was announced.

None of this is convenient for the discussion about reform but that’s mainly because there is no real discussion about reform. The move to shut down ERT is not about structural changes, it is about finding 2,000 civil servants to sack as quickly as possible to meet the troika’s targets. In April, Greece committed to removing the public sector workers as part of a series of pledges to get a bailout instalment of 2.8 billion euros. Samaras’s government gave its pledge that 2,000 civil servants would be gone by June. The troika arrived earlier this month to find that nobody had gone and Greece’s next tranche of 3.3 billion euros is still pending.

If this was about reform, the plan for the new broadcaster would not read so much like a hastily assembled collection of ideas and the government would not have reverted within days of closing ERT to studying an abandoned 2011 plan to overhaul the broadcaster – a scheme that New Democracy opposed at the time. If this had been properly thought through, perhaps in switching off ERT’s signal, the government would not also have taken the exemplary BBC World off Greeks’ screens as well. If it was about change for the better, there would be a more detailed assessment of what went wrong with ERT. Instead, it is much easier to sweep all that under the carpet, to pull the plug and start again with a new model which commentators suspect will continue to be under political control.

And so, we arrived at a sudden death for ERT – a decision that weighs on Samaras but also his coalition partners Evangelos Venizelos of PASOK and Fotis Kouvelis of Democratic Left, who failed to ensure that the overhaul of the public administration was the driving force behind this coalition. Instead of genuine reform, which involves innovation, planning and political commitment, we have ersatz change, which can be achieved by closing down one organization and opening another at a later date.

By accepting this as reform, we are able to close our eyes and ears to the voices from abroad, including journalists’ groups, the European Broadcasting Union, foreign media and diaspora organizations, who expressed alarm at the unprecedented decision to take the country’s broadcaster off air. We dismiss them as naive outsiders who don’t know enough about Greece or, in the extreme case of New Democracy MP Sofia Voultepsi, as international media that are owned by arms dealers.

We go to bed dreaming of reforms and wake up believing they are done. The fallout from the decision to close ERT, though, is the nightmare we weren’t expecting. Apart from its potentially calamitous political consequences, it also shows that this government and the country as a whole lacks purpose in what it is trying to achieve. Apart from being targets in the bailout agreement, there is an absence of clarity about what ultimate purpose these changes have, why civil servants are being fired or shifted from one department to another when there has been no comprehensive evaluation of Greece’s needs.

Even worse, there seems to be little idea of what will happen once these reforms are carried out. As economist Dani Rodrik pointed out last week, when the underlying conditions are unfavourable, the impact of these changes on the economy is limited. “Structural reform increases productivity in practice through two complementary channels. First, low-productivity sectors shed labor. Second, high-productivity sectors expand and hire more labor. Both processes are needed if the reforms are to increase economy-wide productivity,” he writes. “But, when aggregate demand is depressed – as it is in Europe’s periphery – the second mechanism operates weakly, if at all. It is easy to see why: making it easier to fire labor or start new businesses has little effect on hiring when firms already have excess capacity and have difficulty finding consumers. So all we get is the first effect, and thus an increase in unemployment”

So, a year on from the last general election, Greece is pursuing quasi-reforms that are likely to have a limited impact on its depressed economy. In the meantime, its decision makers are no closer to defining what kind of public administration and economy they want to shape. The progress that has been in a number of areas over the last few years is in danger of disappearing into this morass. Somehow, in this mess, three parties that fail to acknowledge these developments have managed to fall out with each other. Like any marriage that is based on denial, the future does not look promising. An awakening is needed if there are to be happier and more productive anniversaries ahead.

Nick Malkoutzis

28 responses to “Happy anniversary. How about a reform?

  1. Comparing ERT to the BBC, to paraphrase the “apple to apple”, is like comparing a grape to a watermelon. The point your trying to make is not helped by this comparison… it serves mostly to weaken your arguments. I would suggest a rewrite of the article.

  2. IN fairness SN1978, Nick introduces the BBC comparison because this is what people are suggesting.He goes on to explain why it is a poor comparison. Interesting read as always.

  3. That’s nice but why do you address the dealership and not the home office? Why don’t you take your case to Merkel and after achieving(I am sure) a favorable resolution to your questions from Berlin bring back to us the better reform package you have in mind and we would be happy to implement it in a manner not provoking your indignation.

    This must be one of the most incomprehensible things about Greece in this crisis. Dividing Greeks among Greeks over artificially imposed targets whose basic reasoning is indefensible trying vainly to make sense of that which by definition is can not be explained or persuadable.

  4. BTW, it would be informative if we could focus the conversation on these 2 issues:

    1. ERT was dissolved through a decree with immediate effect by the government led by New Democracy, using a law which delays the need for parliamentary approval until October. Therefore, is this a tactical move?

    2. The new public service broadcaster, New Hellenic Radio, Internet and Television (NERIT) is expected to launch on 29 August 2013. The service provider will employ between 1,000 to 1,200 and will continue to be funded by advertising and tax contributions. In other words the old ERT is reduced by about 60% (2600 old employees vs. 1200 new employees). Does this mean that the new budget for NERIT would be about 100 Mil. euros vs. the 220 Mil. of the old budget?

  5. BTW:

    Keep listening to ERT; their high quality broadcast is very informative:

    http://www.enet.gr/?i=news.el.ellada&id=369547

  6. Another_Greekboy

    Another very cogent analysis from Nick.

    It’s been amateur hour from the government from the very beginning; whether its on the economic front, the communication front, the political front, or any other front you can think of.

    Its only plan seems to be blindly follow whatever the Troika decides and if need be use decrees to implement their decisions since, after all, if the populace doesn’t know what’s good for it then a good leader has to make these decisions in its stead. the fact that this approach is destroying the social trust that must exist between government and the govern is entirely immaterial to these “σαϊνια.”

    Αχ ρε Σαμαρά… κούνια που σε κούναγε.

    P.S. Even though I have to say the other two dwarves (Kouvelis and Venizelos) are even worse.

    • I am sorry but there never was a crisis about ERT. This is a crisis about how dysfunctional the coalition government is.

      Both Venizelos and Kouvelis knew for more than a month what Samaras’ intentions were. They chose to ignore it and instead of resolving the matter behind closed doors (as civilized people) they chose to air dirty laundry for public consumption.

      The constitutional court is about ready to deliver a slap in the face for these 2 irresponsible partners. ERT has to go back on the air with a much reduced staff.

      And Samaras needs to issue a public apology to these incredibly talented and loyal ERT employees who endured the government dysfunction with dignity and an uncalled for assault on their professional ethics and exemplary conduct.

      This is all about some dirty politics and the bruised egoes of 2 minor partners that behaved as being major players (which of course they are not).

  7. well,well. I would expect a more thorough analysis abt the impact of BBC in Brtitish society compared to ERT’s equivalent impact on Greek society. For the latter I expect nothing more than what we already know. How abt BBC’s performance?????
    I quote fm BBC’s bi-annual report:
    <>
    http://downloads.bbc.co.uk/aboutthebbc/insidethebbc/howwework/reports/pdf/bbc_economic_impact_2013.pdf
    So, is this the case wth ex-ERT???? Did it have that positive impact in Greek economy & society??? No hypocrisy here, just facts

  8. Interested observer

    Opposition to the closure of EPT is so confused. This article basically says (1) I am against closing EPT, (2) closing it wont do any good for the economy anyway and (3) when oh when will the government get on with real reforms?

    To which the responses are really easy: (1) ok noted, no one likes seeing members of their profession sacked, (2) that’s at least arguable given that EPT is legendary for it’s employment of time wasters and (3) this seems like a pretty ballsy stake in the ground that tries to establish the governments seriousness… the other coalition partners can’t reject it without risking an election and therefore the message it sends to the next target is that reforms are real and happening.

  9. This was a good tweet on the Court’s decision to reopen ERT
    Paweł Morski ‏@Pawelmorski 17m
    Greek coalition saved because the lead party was overruled by court. ‘Beyond satire’ is overused, but literally impossible to mock this.

    The person who made VERY EXTENSIVE comments about ERT in my blog will be disappointed. He had argued in detail and passionately that there was no other way but to shut down ERT. I can’t judge whether his comments reflect reality or not, but they are worth reading. As I said, very long, detailed and passionate comments.

    http://klauskastner.blogspot.co.at/2013/06/ert-cui-bono.html

    • Klaus:

      The court decision is vague on the staff issue. If ERT re-opens with a reduced number(most likely) then Samaras wins the argument.

      I don’t think there is any way for the court to compel how many people need to work there at re-opening. Even a symbolic opening with one person (joking of course) is opening.

      The issue of disagreement was the lost jobs. To that the court did not rule anything at all.

    • Klaus:

      The tweet is wrong. The court affirmed the closing down of old ERT but it also ruled that during the transition period ERT can not be “black” (no broadcasting).

      Therefore the broadcasting will resume but the old ERT is gone. Now the real question is how many of the old employees will be rehired. I hope a good portion and at a better salary because most of them were making peanuts (about 1250 euros a month for the average presenter).

      • “The issue of disagreement was the lost jobs. To that the court did not rule anything at all.”

        Producing 2000 public sector firings was the point of the excercise for the government, but the issue for the majority of greeks was the abrupt closure & unvoted legal abolition of a public service.

        BTW Dean, 1,250€ a month is pretty good money here now🙂

      • Eleni:

        National TV presenters making 1250 euros a month is actually very dangerous for the state. It means that such low paid people are open to secret and foreign influence.

        National media presenters should be making at minimum 5000 euros a month. And that’s low.

      • If you look at the list of salaries you will see that the top political appointees get plenty.

        Ellie Stai dropped her salary because of the crisis. Unlike our parliamentarians.

        Meanwhile the ERT-salaried rousfetia appointments working in Simos Kedogoglou’s office (and other ND ministries) get 3,500€ a month (ie 1000€ more than Elli Stai)…and have never stepped foot in ERT. Stournaras has obviously okayed that. So Dean, even now, even in the crisis, it is just business-as-usual for our ever-abusive, ever-corrupt, utterly despicable government.

        You are right about salary levels.

        What this revealed to me is what a lean and professional operation ERT really is, especially when half the staff are rousfetia and either clogging up the real work – or – not even there and just predators on the payroll.

        So all the government prosing about ERT as an economic sinkhole & inflated salaries etc. etc is (1) ridiculous and (2) lies. Especially when the ERT ‘fat’ are all government’s appointments. Poor ERT!

      • IMHO, this was never about ERT.

        This was about a dysfunctional Venizelos who has been angling for a position upgrade since last October. The La-N-garde scandal was a way for Samaras to keep him quiet for 3 months. But he keeps coming back. He wants more. Therefore now the ERT thing to keep him down again.

        The deal with the Troika was that if Greece fires 2000 by end of June, then Greece is allowed to hire 12500 in needed areas (tax collection for example). Since now the court ruled that new ERT needs broadcasting it also means that Greece could hire back some of the ERT folk (but not all of them).

        So the government’s intention was to get 2600 fired quickly so that it could rehire or hire about 6 times as much.

        Syriza which is not in the mix (because no one wants to talk to these people) fabricated this whole ERT thing about being something else. The Constitutional Court today confirmed that the old ERT is dead.

        Syriza will be wasting our time for the next 2-3 weeks trying to convince us that keeping ERT broadcasting alive means that the old ERT was restored. But then again you are talking about amateurs and spinners. This is turning into a major Syriza embarrassment. You could cry wolf a few times but then people tune off.

  10. Another_Greekboy

    Another typical neither pig nor pork decision by the Court. Everyone will be able to interpret this decision in any way they want. ERT will claim victory because they will remain open; the government will claim victory because they will interpret this to say that even though ERT should reopen, they get to decide who works there; the political dwarves (Kouvelis, Venizelos) will claim that they had made this point all along. ANother example of kick the can down the road.

    As far as Klaus’s commentator goes while the metaphor of Hercules cleaning out the Augean stables might be an apt one, s/he should explain to us in what universe Samaras can be thought of as a modern day Hercules. Given his past history, he should be more aptly compared to Augeas himself. And then the rhetorical question becomes: Can Augeas be trusted to clean out Augeas’s stables?

  11. I am British and living in Crete. The BBC waste money, go on lots of jollies (at our expense) and do not deserve the fee of 147,50 pounds, All they provide is repeat programmes. They do not cover important world issues, No-one in the UK knows what’s going on in Greece. They are very corrupt as we know. They report what the Goverment want them to report. And they are very anti-Royal, even though they put on the the Rotal Pageant because we the public would go mad ig the didn’t. Enough said. Just hope that Greece get through this crisis xx

  12. A bit off-topic but still – I thought I would post impressions I have had as a visiting foreigner about Greek TV.

    First, I was stunned by the number of nationwide channels. Austria is a country of 8 million. We have 2 public and one private nationwide channel. A few additional regional channels. The news are pretty standard: hourly short summaries; half-hour programs at 7.30 and 10 pm. Periodic TV discussions. The rest normal programming. And, of course, we get most of the German channels.

    In Greece, I felt like being surrounded by CNN, ABC, NBC, CBS and Fox at the same time. Discussions on 4-way (sometimes 6-way!) split screens from morning onwards (I often wondered where they get all the guests from…). I am particularly impressed by Elli Stai. I mean, she runs her show not unlike a top American anchor (mind you, I can’t speak for quality of content because of my poor Greek). There isn’t a woman on German or Austrian TV who pulls off such a professionally-staged show with all the visual effects that Stai uses for herself and her guests. The content may be lousy,I can’t tell, but the way that show is put together and run is sensational. And there are other shows which impress me equally.

    In short, I have always wondered how a relatively small country like Greece could come up with TV coverage on a level which may not even be known to every farmer in the American Midwest. Every time, when in Germany or Austria, I switch over to CNN & Co., I wonder why the German and Austrian channels can’t become a little more technologically progressive: split screens, video conferences, visual effects, etc. etc. As I said, when in Greece, I feel more like watching CNN & Co. than watching German or Austrian channels.

    PS: the last 2 months which I spent in Greece, my ORF digital card was not working but I had access to all the other German Astra-channels which I also use in Austria. So, I was forced to live for 2 months without the blessings of the two Austrian public broadcasters. And guess what? I didn’t miss them a bit!

  13. Another_Greekboy

    The one positive thing that could (I underscore “could”) come out of this sad episode is if it somehow became the catalyst for a serious discussion on how the country is ruled and how decisions are (should be) taken by a government. But I doubt it will come to that. The αποφασιζούμε και διατάζουμε mentality is deeply anchored in some people.

  14. Another_Greekboy

    Puff, puff, puff…

    Manos Hadjidakis from an interview given to Maria Rejan in the 1980s (1984 I think). The last sentence captures it all: “Η ΕΡΤ είναι ένα απαραίτητο φάρμακο, για να ζούμε με την ψευδαίσθηση της ελευθερίας.”
    ———-
    “-κ. Χατζιδάκι σκεφθήκατε ποτέ να εισηγηθείτε, να διαλυθεί η ΕΡΤ και να αρχίσει από την αρχή;

    -Κι αυτό θα το εισηγούμην, αλλά ο κόσμος δεν μπορεί να ζήσει πια, χωρίς την ΕΡΤ. Θα πεθάνουν αν δεν τους δώσεις εκείνο, για το οποίο θα μπορούν να φωνάζουν και να διαμαρτύρονται. Η ΕΡΤ είναι πολύτιμη, διότι δίδει στον Ελληνικό λαό, την ευκαιρία να διαμαρτύρεται και να λέει «τι αίσχος που είναι η ΕΡΤ.» Η αντιπολίτευση διαμαρτύρεται, γιατί δεν της δίνουν περισσότερο χρόνο, οι άλλοι διαμαρτύρονται γιατί δεν τους δίνουν περισσότερη «Δυναστεία», οι άλλοι διαμαρτύρονται γιατί υπάρχει η «Δυναστεία» και όλοι είναι ευχαριστημένοι… Η ΕΡΤ είναι ένα απαραίτητο φάρμακο, για να ζούμε με την ψευδαίσθηση της ελευθερίας…

  15. If I were in charge of the new ERT the objective would be to have a group of 500-1000 top notch professionals doing the best television in the Greek spectrum. In return, all of the members of the new team would be well-paid and super motivated to do a super job. This would mean them receiving at least 2-3 times the salaries they make today.

    The environment fostered would be open, creative, collaborative promoting team plays of excellence. The stated objective would be to become the best public television in the entire European Union but not only.

  16. Apparently Syriza has some trustworthy people who could tell the truth. Yesterday’s court decision abolishes the old ERT. In that sense the decision has been a gigantic defeat for Syriza. In other words the exact opposite of what Tsipras is saying. And this is very typical of Greek politics; to promote what is “white” as “black” and what is “black” as “white”. I guess Syriza is learning from Merkel:

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