Author Q&A: Yannis Palaiologos

The 13th Labour of Hercules: Inside the Greek Crisis
Yannis Palaiologos
(Granta, £14.99)

Since the revelation of its massive hidden deficit in late 2009, Greece has been at the centre of the world’s attention as it lurches from crisis to crisis. Through a series of compelling stories – from a cancer sufferer depending on charitable healthcare to the financial minister charged with clearing up tax evasion, Yannis Palaiologos, a features reporter for Kathimerini newspaper in Athens, explores the story of how a seemingly advanced economy crumbled and the effect on its people.

If Greek fibs to Eurostat about its poor finances in the early noughties had been detected, would things have been different?
It’s hard to say. It certainly would have alerted Brussels to the seriousness of the problems with Greek statistics. But it’s worth keeping in mind that many other countries also massaged their figures to gain entry into the Eurozone, while the EU looked the other way.

Another thing that might have made a difference would have been the assumption of more invasive inspection powers by Eurostat in 2003, when France and Germany violated the deficit rules of the Stability and Growth Pact. But of course, Paris and Berlin wouldn’t hear of it.

Why don’t Greeks pay their taxes?
A central reason is that they don’t trust the state to use the money for the common good. In addition, Greece has a huge number of self-employed individuals compared to the European average. Tax cheating is high everywhere among the self-employed but with Greece having so many of them, the lost public revenue is proportionally greater. Also, until recently tax administration was a complete shambles. People were simply not afraid of getting caught.

Greece’s famous shipping industry: an over-privileged elite or force for change?
It’s certainly a good example for prospective entrepreneurs everywhere and it is nothing short of impressive that Greek-owned shipping has led all other national fleets in size for the past four decades. On the other hand, they are clearly a very privileged elite whose exemption from most taxes feels particularly hard to take in a time of such widespread want.

What can be done to weaken neo-Nazi party Golden Dawn?
One major thing finally did happen last year: the criminal prosecution of its leadership. However, they remain popular. Economic recovery will weaken them further but I don’t think it will consign them to insignificance. Either Golden Dawn or a successor far-right group will continue to wield electoral influence as long as Greece remains an illiberal, closed society and the EU refuses to do more to alleviate the burden of illegal immigration to Europe that the country is called upon to bear.

Alexis Tsipras and Syriza are seen by much of the European left as an inspiration. What’s your view?
Unfortunately, though I ache for something new in Greek politics, I’m afraid that Syriza represents the old – and a particularly stale version of it. I’ll be thrilled to be proved wrong, and I do think they have some serious people on the front bench. But on crucial issues, like the role of the state in the economy and public administration reform, they seem to embody the most unreconstructed version of the Greek left.

Can web entrepreneurs and start-ups continue to bring social change?
I don’t know about social change, nor do I think that the sector alone can bring about economic recovery. But it is certainly a welcome development that talented Greeks are turning their ideas into businesses at home instead of emigrating. The Greek start-ups are a breath of fresh air in terms of the working culture that they espouse, and it’s not unlikely that one of them will in the coming years rise to international stardom.

With Germany and France stagnating, will northern EU members ever be able to accommodate Greece’s economic needs?
Well, the main reason they are stagnating is the austerity obsession of Berlin, which has now brought the Eurozone to the verge of triple-dip recession, as well as deflation. Greater fiscal flexibility would improve Europe’s prospects considerably and allow Greece to grow faster and meet its own economic needs. A separate issue is that of Greece’s debt, held now mostly by its Eurozone partners and other official creditors. Further relief, as promised in November 2012, would give the Greek economy breathing room to grow and would improve the terms of its access to capital markets.

What is it that gives you hope Greece can recover?
Greece has tons of talent, spread out all over the world. Many of these people would love to return and contribute at home – it is, even after six years of deep crisis, a fantastic place to live – if they saw some inkling that the old system was being replaced by something better. If that were to happen, the vicious cycle of the best and brightest leaving and the most mediocre and ruthless running things at home could turn into a virtuous one.