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One night in Cannes
There are few people in the world unhinged enough to have been willing to switch places with Greece's decision makers over the past few years. For all their failings, ministers, prime ministers and others have often found themselves in impossible situations, caught between a baying public at home and obdurate counterparts abroad. We must be clear that there were rarely straightforward solutions to Greece's problems since the start of the crisis.
Saying that, the same decision makers cannot be allowed to hide behind the difficulties of the situation they faced. The choices they made at each step along the way had the potential to make things better or worse. It is on these decisions, and what motivated them, that they must be judged.
There have been few more pivotal moments in the Greek crisis than (then Prime Minister) George Papandreou's decision on October 31 2011 to announce a referendum on the second bailout his government had just agreed with the troika. It mostly sparked panic in Europe and at home, although Papandreou's plan was given the thumbs up by some commentators and received the approval of his cabinet on November 1.
The ex-PASOK leader's proposal may have been a productive one, although certainly risky. It is likely to have flushed out the snipers and those who built their popularity on opposing the memorandum. It might have been a moment of catharsis for the Greek people, a time to reconcile themselves with how their county had ended up on the eurozone precipice and what needed to be done to move away from there safely.
We never got to find out because the referendum was scuppered. It was undermined first of all by Papandreou himself, who failed to prepare the ground at home and abroad for such a momentous suggestion. It was the last of the arm flailing from a government that had long started to lose its way.
However, as a riveting account of events by Financial Times journalist Peter Spiegel has highlighted, there were a fair few others digging furiously to ensure that the referendum was left dead in the water. The article portrays a nerve-ridden German Chancellor Angela Merkel and frantic French President Nicolas Sarkozy at the sidelines of the G20 summit in Cannes on November 2. The former wanted Greece’s membership of the eurozone to be at the heart of the question, while the latter was desperate to block a vote on the terms of Greece's bailout. They knew very well there was a world of difference between a government with an ever-dwindling majority cramming tough austerity measures through Parliament and the Greek people who bore the burden of these cuts being asked to approve or reject them in a plebiscite. European Commission President Jose Manuel Barroso is reported to have discussed with Antonis Samaras and Evangelos Venizelos the need to “kill” the referendum.
As a result, a halfway house was found. Papandreou could have his vote but only as long as Greece’s euro membership was also at stake. The eurozone leaders felt that this was the better option, even though by just uttering these words in public they were increasing the likelihood that Greece would be forced out of the single currency. At that moment they decided they would rather deal with the potentially catastrophic fallout from a Greek exit rather than rework the demanding terms of Greece's second bailout. It was hardly a shining moment for the single currency and the principles underpinning it.
It was also the point at which Papandreou's bid for a referendum and his premiership as a whole had reached its end. This was not the vote he had promised to the Greek people two days earlier and there appeared no basis in public opinion for putting Greece’s euro membership on the line.
However, was this the reason that Samaras, then opposition leader, and Venizelos, the finance minister at the time, opposed the referendum? Samaras was concerned the vote would leave him politically exposed. After almost two years of denying New Democracy had any responsibility in causing the crisis and launching relentless assaults on Papandreou for agreeing to the first bailout, Samaras would have had to put up and shut up. His opportunist anti-austerity facade would have collapsed and he would have been corralled by his fierce political rival into the “Yes” camp, accepting the harsh eurozone terms that came with such a surrender.
The view from the Samaras camp, though, is that the New Democracy leader sacrificed his beliefs and joined the caretaker government led by ex-central banker Lucas Papademos in the wake of Cannes because Papandreou had brought Greece to the brink of collapse. However, this begs the question of why Samaras did not go all out to create a coalition government with Papandreou in the summer of 2011, when the prime minister invited him to do so. The proposal was leaked to the media before Papandreou could discuss the idea with his own party and the attempt at bridge building collapsed.
Greece was also in vulnerable position that summer, with the government struggling to pass the Medium-Term Fiscal Plan and mass protests and rioting on the streets. But less than five months later the conservative leader had the chance to argue that he was coming to the rescue after Papandreou’s foul-up.
Venizelos has adopted a similar line, arguing that he had to step in to save the situation. The FT article has whipped the PASOK leader into a frenzy this week. He denied that Barroso had any influence but insisted it was necessary for Greece to “kill” the referendum. He even suggested that it was a pre-dawn text message from his daughter, as the Greek delegation returned from Cannes, that convinced him to pen a statement on the flight home arguing that the referendum should not happen.
Yet, on October 31 Venizelos stood before PASOK MPs in Parliament and defended the idea of a referendum on the second bailout moments after Papandreou announced the idea. He said the vote was a “democratic” idea that would be a “national release and salvation.”
Venizelos has argued that he was ambushed by Papandreou, who did not consult with him over the idea. He says he backed the idea initially because he feared that if he didn’t it would destabilise the government. Later that same night, though, Venizelos repeated his comments in a TV interview. Surely by that time the surprise had worn off. And, if bringing down the PASOK government was such a concern for Venizelos, the statement he issued in the early hours of November 2 suggests he got over it rather quickly.
A vote on any question including whether Greece would remain in the euro would have caused a bank run, argues Venizelos. “If I didn’t issue the statement, there would have been no banks left by 9 a.m.,” he said this week. But couldn’t a likely “no” vote in the referendum Papandreou had first proposed have this exact effect? After all, a rejection of the second bailout would have left the government in tatters, the measures rejected, the adjustment program grounding to a halt and Greece running out of money – hardly a stable environment.
Samaras and Venizelos will forever profess that they sacrificed themselves for the good of the country. Perhaps history will prove this version of events to be correct. Certainly, the Grexit threat that appeared on that night in Cannes concentrated their minds. The result of a referendum on whether Greeks were willing to suffer more troika-designated austerity to remain in the euros was not a foregone conclusion. However, one has to ask to what extent Samaras and Venizelos’s decisions were driven by a desire to save themselves. After all, within a short time of that night in Cannes, Venizelos became PASOK leader – a position he coveted and failed to grab since 2007 – and Samaras achieved his ambition of becoming prime minister.
The picture painted by Spiegel’s analysis and the volte-face performed by Samaras and Venizelos suggests that under the threat of a euro exit Greek politics was exposed as a charade, rather than the arena of heroes some would like us to believe. When coupled with the realisation of how appallingly the eurozone conducted its business at this crucial time, it leaves a bitter taste in the mouth. How ironic that Cannes, a place usually associated with class, should produce something so tawdry.
To me, Cannes will go down into history as the greatest missed opportunity for Greece. If Greece had been blessed with strong leadership, Cannes could have gone down into history as Greece's finest hour.
To say that the Eurozone conducted its business appallingly at that crucial time is an understatement. Spiegel's account shows that they were amateurs. When the Greek leadership saw that Merkel was crying and Sarkozy was using four-letter-words, they should have realized that they had their opponents where they wanted them to be --- close to nervous breakdown. At that point, the Greek leadership should have proposed a way out of the deadlock by proposing something like: "ok, if cancelling the referendum is so important to you, we'll cancel it but you've got to give us something in exchange for that; something like 10-20 BEUR for growth measures in the private sector because that will help us to get support from our people". 10-20 BEUR would have been peanuts in the grand scheme of things at the time.
Cannes is perhaps more than anything else associated with cinema and the world of illusion. And the cinematic medium has often been used as, among other things, a space where history can be represented, recast, reinterpreted and ultimately manipulated.
In essence, cinema romanticizes history. It take an "interesting" (e.g. cinematic) story, fill in what it considers to be "gaps" within the historical narrative with some "cool details", and wrap everything up into an epic that purports to "tells" the whole story.
Fundamentally, the problem with this doesn't lie with the inherent inaccuracies contained in movies. No matter how "accurate" you try to make a movie it will inevitably present a biased view (the bias is inherent in the concept of history itself). The problem is that we - as societies - tend to rely on film as an educational medium and we tend to believe the romanticized versions of history it serves us as somehow being closer to the "objective" truth. Our societies are so generally ignorant of history that audiences are gullible enough to be easily manipulated to take the "story" being told by a movie at face value without even thinking of questioning the underlying "accuracy" of the historical record it attempts to capture and convey.
Herein lies the value of Cannes as a metaphor for cinema and illusion. It underscores the fundamentally constructed rhetorical farce the Samaras and Venizelos of the world are trying to sellus as "real" in lieu of the historical facts that the Spiegel’s analysis lays out for all to see.