As Socialist as a loan shark…

It’s funny how a country that always makes such a big deal of its ‘social conscience’, never seems to actually possess one when it comes to crises in other countries.

Countries like Greece, for instance. News coming out of that country is now little short of harrowing. There has been a (mostly unreported) wave of suicides, particularly among the younger generations. We have all seen images of pensioners weeping on the streets, of endless queues at banks and for Victory Kitchen-style meals … and that’s before even looking at the financial stats, which is where the real horror lies.

The Greek economy has shrunk by 25% in the five years since the first of two bailout packages in 2010. Youth unemployment shot up to 60% over the same time-period. Even more staggering is the revelation that, of the 310 billion injected into Greece by the EU and the IMF, 90% has actually gone towards paying debts held by private banks in Germany, France and elsewhere.

This, then, is the absurdity of the current Greek situation. The EU (Malta included) gave the Greeks money to pay back debts held by the same EU’s banks… and then criticised Greece for failing to use that money to implement the reforms upon which the same ‘loan’ was conditional. And to compound matters, the same EU keeps doggedly insisting that Greece accept the same conditions that have so far only exacerbated an already impossible situation anyway.

And they won’t take ‘Oxi’ for an answer… 

But how is Malta – which owns around €177 million of that unrecoverable debt – collectively responding to the crisis? 

Well, here is Opposition leader Simon Busuttil’s reaction to Saturday’s referendum, as expressed in a Facebook status update: “…Grexit would have significant repercussions not just on Greece, which will have to reintroduce its own currency, but also for the entire zone, including us. In the face of this impending situation, I call upon the Government to redouble its efforts to protect our national interest. There is a lot at stake for us, both in terms of our debt exposure with Greece as well as our vested interest in the stability of the eurozone…”

Hmm. It’s a pity that Simon Busuttil didn’t actually specify what he considers the ‘national interest’ to be in this particular case. It’s not exactly clear-cut, you know. 

Some of us – myself included – would argue that it is certainly not in Malta’s interest to allow Greece (an ally of ours in bygone years, and always a good friend) to founder. Still less is it in Malta’s interest to not only refuse to throw flailing Greece a lifeline in the form of debt-relief… but to actively hasten its demise by punching holes into the sinking ship instead.

But hey, that’s just me… and considering how the rest of Busuttil’s comment appears rooted only in concerns for the ‘entire Eurozone’ (and not, presumably, for the sum of its parts, which also include Greece)… it is likelier that he meant something else entirely.

Perhaps he meant that Malta now stands to lose the €177 million it so unwisely contributed to those two doomed bail-out packages in 2010 and 2013… and that Muscat should make damn sure this debt is somehow repaid in full, even when we all know it can’t be. 

And fair enough: €177 million is a heck of a lot of money, I’ll grant you. But that only raises the question of why we lent it in the first place, when most economists were arguing at the time that the bailout plan was destined to fail. This in turn points towards a glaring issue that all our politicians (unlike their counterparts in the rest of Europe, which is actually divided on this point) have so far studiously avoided even mentioning: i.e., the responsibility of the lender country in the event that a loan proves unrecoverable.

But let’s come back to that later. For the moment I am more interested in what such comments tell us about the people making them. And in Busuttil’s case, it’s nothing particularly surprising or unexpected. He is, after all, the leader of an EPP member party that is ideologically aligned with Angela Merkel’s Christian Democratic government of Germany. You can hardly be surprised, then, that his sentiments would echo Merkel’s (or for that matter Juncker’s) to the letter.

Personally, I admit I was a little taken aback by the complete absence of any discernible empathy for the truly unthinkable human tragedy currently enfolding in Greece. Insofar as what it told us about his own views of this tragedy, Busuttil’s statement could just as easily have been uttered by an automaton with no trace of humanity whatsoever. 

But still: politically, Busuttil is being consistent. His PN is very clearly aligned with the ideological side of this debate that views the ‘European Project’ as an end in itself, to be supported and defended at absolutely all costs.  Incidentally this also resonates with the PN’s entire stand on the EU ever since we first started talking about accession in the 1990s. The issue was always presented to us as a matter of dogma: one was either ‘pro-’ or ‘anti-EU’… without ever bothering too much with such trifling questions as: yes, but what is this European Union thing, anyway? And where is it all heading…?

Over to Labour now, and this is where things start to get decidedly less predictable. For while the PN is viscerally – genetically almost – bound to this Utopian vision of a European ‘Wonderland’ that never really materialised… the Labour Party was just as viscerally allergic to the same vision until fairly recently. Its former leader Alfred Sant had campaigned assiduously against accession before 2004, and – more pointedly – even warned against Malta’s premature entry to the Eurozone afterwards. 

All of which makes the Labour Party’s position today that much more absurd. Now that Sant has been thoroughly vindicated on at least one aspect of his erstwhile EU policy – his scepticism regarding the future of the Euro – the party he once led has morphed into a carbon copy of the EU-besotted PN. And it seems to have left its ‘Socialist’ mantle hanging by the door, too.

Malta’s supposedly left-wing government has in fact taken an even harder line with the Greek government  – its own distant cousin in the European political family tree – than the Nationalists… arguably, even than Merkel herself. I for one was absolutely gobsmacked to hear our current finance minister Edward Scicluna echoing the most vitriolic criticism of Alexis Tsipras’s government almost word-for-word.

At moments he sounded like the archetypal school disciplinarian: “We are losing patience with Greece”, he told us during the abortive negotiations leading to the referendum last Saturday. Because of course, it was terribly unfair of a government that was democratically elected on an anti-austerity platform, to actually oppose austerity once elected… especially an austerity programme that has manifestly only made the Greek debt crisis worse.

Yet Malta’s Socialist finance minister – just like its Conservative Opposition leader – weighed in very heavily on the side of a Eurogroup, dominated by Germany’s centre-right government, that has proved completely inflexible when faced with the stark failure of its own policies. He even publicly rejoiced at the surprise resignation last Monday of his Greek counterpart Varoufakis… who, love him or hate him, had come to emblemise an archetypally Socialist struggle against “European imperialism”.

And of course, Scicluna’s sentiments are shared entirely by Prime Minister Joseph Muscat. “Unequivocal Greek vote cannot be taken lightly. Carries consequences for Greece, people in creditor countries + for European project,” he tweeted this week… followed by “GRgov protected its ppl’s interest in way it deemed best. Ppl in creditor countries expect their reps to protect their+Euro interest too.”

Rough translation from twitterspeak: “We want our money back, and couldn’t care less whether the unreasonable loan repayment conditions placed by the troika on Greece will result in unspeakable poverty, misery and despair among its people.”

This, I must admit, I find surprising. Not so much that Muscat would push for debt recovery as an ultimate goal… but that Malta’s ‘Socialist’ prime minister would openly echo sentiments so far expressed only by the most overwhelmingly right-wing contributors to the entire debate: i.e., that Greece should accept without questions a ‘bail-out package’ that in reality only bails out banks in other countries, while radically exacerbating the crisis in Greece.

It surprises me for another, less ideological reason, too. The same Muscat was recently heard boasting – not unjustifiably – about having solved Malta’s own deficit problem… and to quote him verbatim: “and we did it without resorting to austerity measures.”

Translation: like the Syriza government, Muscat and Scicluna believe that austerity is not actually essential to implement the sort of reforms now required of Greece. Why, then, do both now insist on collectively punishing Greece with austerity measures that have already proved counter-productive anyway? Why are they ‘losing patience’ with the Greek government… when the Greek government is only arguing the exact same case Muscat himself made earlier this year: i.e., that austerity is very evidently NOT the answer to national debt issues? 

Nor is this the only conundrum. Implicit in both Busuttil and Muscat’s attitudes is a very basic misunderstanding of the relationship between creditor and debtor countries. Both have to date consistently portrayed Greece’s debt to Malta as a responsibility that must be honoured exclusively at Greece’s end. Neither has even remotely acknowledged that Malta, as a lending country, also has responsibilities of its own. 

We are ultimately responsible for consciously signing up to a bailout package when there was absolutely no guarantee that we would ever recover the money… and when all indications pointed precisely in the opposite direction.

It is therefore slightly incongruous for Edward Scicluna to rap Greece on the knuckles for “behaving irresponsibly”… when his own country was irresponsible enough to lend €177 million to a country that already owed €300 billion, and counting. It also slightly late for Scicluna to be ‘losing patience’ with Greece… or even for Muscat to try and ‘protect the national interest’. There was a time when it was still possible to ‘protect the national interest’ in this scenario… and that was when we were asked to lend €177 million to a country, fully cognisant that we would never see that money again.

Yet here we are, with a Socialist government insisting that Greece cough up the money it owes us, even when its youth is collectively flinging itself into the Hellespont in despair, and its pensioners cry openly on the streets. Let’s face it: only a loan shark would insist on debt repayment under such circumstances. And off-hand, I can’t think of anything less ‘Socialist’ to compare our government to, than a loan shark.