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Saturday, 14 February 2015
A Look at the Greek PM Tsipras' First Address to Parliament
Dimitri Lascaris discusses how the SYRIZA government plans to end austerity and carry out the clear mandate of the people - TRNN,
February 11, 2015
Dimitri Lascaris is a partner with the Canadian law firm of Siskinds where he heads the firms securities class actions practice. Before joining Siskinds, he practiced securities law in the New York and Paris offices of a major Wall Street law firm. Last year, he was named by Canadian Business Magazine as one of the 50 most influential business people in Canada, and was described by the Magazine as "the fiercest advocate for shareholder rights" in Canada. He is currently prosecuting numerous securities class actions in Canada, including the Sino-Forest class action in which his clients just negotiated the largest auditor settlement in Canadian history: a $117 million settlement with the accounting firm, Ernst & Young.
SHARMINI PERIES, EXEC. PRODUCER, TRNN: Welcome to The Real News Network. I'm Sharmini Peries, coming to you from Baltimore. In his first major parliament speech, Prime Minister Alexis Tsipras of Greece vowed and honored anti-austerity pledges made to voters that ushered him and his party, SYRIZA, into power. To discuss all of this, I'm joined by Dimitri Lascaris. Dimitri is joining us from London, Ontario. And he's a partner with the Canadian law firm Siskinds, where he heads the firm's securities class-actions practice. Thank you for joining us, Dimitri. So, Dimitri, what did the new prime minister have to say in his first big speech in Parliament?
DIMITRI LASCARIS, SECURITIES CLASS-ACTIONS LAWYER IN CANADA: Well, the background to the speech is of course that there is effectively a standoff between the positions of the new government and the troika, or what I sometimes refer to as the austerity bloc, namely, the latter, the austerity block, is insisting upon full or essentially full compliance with the program of austerity measures that the prior government agreed to as a condition of the so-called bailout of Greece, whereas the government of Tsipras is insisting that the austerity program be substantially relaxed and that further loans to Greece not be conditioned upon full or near-full compliance with that program. So that's the background. And very little if any significant headway has been made between these two opposing sides since the government was elected. And today,
Tsipras stood up in Parliament, and his essential message was that we don't have the right to force compliance with the program on the Greek people at this stage. Our mandate was to do precisely the opposite. And that means to substantially relax--not necessarily entirely abandon the program, but substantially relax the program, and in particular protect the most vulnerable members of Greek society. And so then he laid out a series of measures that he felt and his colleagues within the new government felt would accomplish precisely that. They included increasing the exemption on income that is not subject to tax, so that those who are the lowest income earners the country wouldn't have to pay income tax would pay much less income tax, a gradual restoration of the minimum wage to a level where it was at a few years ago when the austerity program began. It would be approximately 750, I think, or somewhat more than that euros a month.
At the end of the gradual escalation of the minimum wage, he talked about eliminating a property tax that was particularly punitive and hard on the poorer members of society, the restoration of electricity to those who had been penalized for their inability to pay certain property taxes. He also talked importantly about collection of taxes that are due from those who have evaded their tax obligations of Greece. According to the government, there are 7 billion euros of tax liabilities owed by tax invaders that they have identified, and the government says that some 2.5 billion euros is available for immediate collection.
PERIES: And how would they go about collecting these taxes? I mean, Greece seems to have a real problem with this particular issue, which is partly what led to this problem in the first place.
LASCARIS: Oh, I suspect--I don't know all of the details, but I suspect it has to do with asset seizure. And that's something that the prior government didn't seem particularly interested in doing in a reasonably aggressive manner. This government seems quite intent upon doing that. So whether the assets in question happen to be real estate, financial assets, other types of assets, they seem quite determined to ensure that those liabilities are satisfied by whatever means available. Interestingly, quite apart from all of those measures, he also raised an issue which SYRIZA's coalition partner, the Independent Greeks, feel particularly strongly about, and that is reparations from Germany for the devastation that Greece suffered during the occupation in the Second World War.
And, in fact, the foreign minister of Greece, the new foreign minister, who speaks fluent German, was in Germany in the last couple of days, and standing beside his counterpart he stated in Berlin, in fluent German, that it was time for Germany to satisfy that profound moral debt that it owed to the Greek people. While the German--his German counterpart acknowledged the suffering of the Greek people during the Second World War, he showed complete inflexibility in terms of paying any reparations to Greece and simply claimed in a general sense that the matter had been closed from a legal perspective, even to the point of rebuffing a demand by Greece that a loan that the Central Bank of Greece was forced to extend to the Nazi government be repaid. So, apparently, the government of Merkel is not even prepared to repay that loan. And so this is, as you can imagine, a matter of some friction between the two governments. But, again, as in the case of the austerity program and compliance with the austerity program, there doesn't seem to be any movement towards a middle compromise ground, notwithstanding the fact that Greece, the Greek government said today that it's prepared, probably prepared to comply with up to 70 percent of the austerity measures that were part of the previously negotiated program. So it's not as though they're taking a particularly hard line, by any stretch of the imagination, but there doesn't appear to be any compromise whatsoever of any significance coming from--.
PERIES: And how would they be able to pay back that 70 percent?
LASCARIS: Well, it's 70 percent of--I may have misspoke. It's not pay back 70 percent; it's compliance with 70 percent of the austerity measures that were part of the program that was negotiated by the prior government.
PERIES: Okay. And so, Dimitri, this was obviously--the speech, getting back to the speech, the speech was obviously well received by parliamentarians and the people. How is the media in Greece responding to it?
LASCARIS: Well, the media is largely controlled by the oligarchy. And so I wouldn't go so far as to say that the media is portraying the position of the government unkindly. I think it's very difficult for it to do that, because the vast majority of Greeks are supportive of the government position. Sky Television just did a poll and found that seven out of ten Greeks are firmly in favor of the government's position and it's hard negotiating stance or relatively hard negotiating stance with its European partners. So they're not characterizing it in an unflattering way. But I think that the people who control the media in Greece are very concerned where this is all going to head. And, in fact, some 8-10 billion euros have been withdrawn from Greek bank accounts over the last month or so in anticipation of a possible default and Grexit, which has placed very considerable stress on big banks. And you can be sure that a very significant part of that deposit flight, that represents assets of the wealthier members of Greek society, the very persons who happen to control the media. But as I say, given the immense popular support for the government's position, the media is not exactly in a position to be really critical.
PERIES: Dimitri, this is a typical problem experienced by many governments that stray from the norm. For example, when Venezuela elected President Hugo Chávez and went into a crisis with the coup, one of the first things it had to do was actually stop capital flight. Is that kind of a program or discussion taking place in Greece?
LASCARIS: It would be astonishing to me if it weren't. There's a very high level of economic competence within the Greek government. The economist, of course, who's received the greatest degree of attention is the finance minister, Yanis Varoufakis. But there are many other very qualified, accomplished economic academics and practitioners who form part of the SYRIZA government. And given their level of economic sophistication, it's hard to imagine that they aren't planning for the possible eventuality of a default and a Grexit. And that could only be done in a reasonably orderly manner if there were effective capital controls put in place. But they're not going to talk about that publicly in advance of them being established, because that's just going to accelerate the deposit flight.
PERIES: Very well, Dimitri. Thank you so much for your update today, and we'll be coming back to you later this week.
LASCARIS: My pleasure,
Shar.PERIES: And thank you for joining us on The Real News Network.