The Greek economy continues to stand on the edge of the cliff. Despite the EU-IMF' s bailout, -- the unprecedented austerity program of cutting wages and pensions implemented by the Greek government and a tough tax invasion pushing down the buying power and income of the middle class -- the forecasts are still ominous for the Greek economy's prospects.
Although the European leaders seem to be -- more than the previous months -- close to a permanent common European solution for supporting dept-ridden Euro-zone's countries after 2013, Greece doesn't have a lot of time to put its messy fiscal house in order. On the contrary, it must start right now figuring out those policies of dealing with its unsustainable debt. According to most optimistic accounts that debt is going to increase over the next years, surpassing its highest level of 160% of the GDP and even potentially reaching 190% of the GDP until 2014.
The recent call of EU-IMF representatives on the Greek government to sell some of the country's public assets in order to find 50 billion euros to pay back its debt provoked intense reactions by political parties, social groups and even the Prime Minister George Papandreou. These reactions, though, are likely a game of impressions, rather than a meaningful opposition to the common truth, namely the primary necessity for the state to collect money by exploiting effectively its assets. The fact is that neither Mr. Papandreou's government nor the major New Democracy opposition party is objecting to the proposal of Greece selling some of its public assets. Of course no one in the country discusses seriously, for example, ideas such as those coming from some German and other provocative voices from abroad, suggesting Greece needs to sell its islands or even the Parthenon -- a proposal that is out of the question.
At this moment, government and opposition parties in Greece are choosing the option of playing with the words. That means they don't accept the term of "selling" but insist on the word of "exploiting" the vast state holdings, much of which remain for decades mishandled, unexploited or even not committed to paper. It's not an exaggeration to point out that any Greek government until today never knew accurately which was the state fortune. Yet, going back to the recent past of 2004, the majority of those buildings constructed for the Olympic Games' organization in Athens were abandoned when the lights of the celebration were turned off. The key question now, is how the Greek government may design and put into practice -- with responsibility towards the country's national interest -- a long-term program beginning by writing down what ground areas and buildings across the country belong to the public and, afterwards, determining the terms of managing those public assets.
The issue of privatizing some of those assets was taboo for the Greek society for many years. Any government of the past never decided to seriously raise the constraints of the public administration's bureaucracy, which is hindering, until today, any effort to attract private investments that would push the economy forward.
In 2008, the IMF estimated that the value of Greek state holdings correspond to 81% of GDP, supporting the view of those who claim that selling public asset constitutes a means for Greece to confront the problem of its fiscal derailment. No one would argue that the economy in Greece can withstand any more austerity measures which will further cut wages and pensions, disrupt social security, shrink any business initiative and deprive the Greek economy of the oxygen needed. Unfortunately, the option of exploiting public assets in Greece should have been one of the government's primary priorities. Through that way, Greece may draw more investors from abroad, especially in the field of tourism, boost the productive basis of its economy and gain money to pay back its debt. Exploiting the country's assets does not mean selling parts engaged with national security and dominance issues. It means handling its own property like a household that owes a lot of money to its lenders and needs to sell or rent some of its property in order to find the amount needed to pay back its debt. Otherwise the household will not avoid foreclosure.
The discussion about the potential privatization of public assets is connected to the question of our ideological perspective of the role of state in our society. In other words, what should be the boundaries between statism and market's liberation? In the case of Greece, however, there is no chance for such ideological brainstorming. The state should be shrunk, motivating private initiatives to do business in the country and manage profitably its unexploited assets. Things that are very much self-evident, but in the case of Greece are still remaining unimplemented because of lack of vision, decisiveness and political consent. For how long, though?