Dimitri Lascaris: Heart wrenching personal stories show that Greece should reject austerity deal and pull out of Eurozone - February 16, 2012
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Dimitri Lascaris is a partner with the Canadian law firm of Siskinds, where he heads the firm's 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.
PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington.When we see pictures of buildings burning in Athens, police and protesters, we hear debates about austerity and stimulus and such, it all seems a little bit abstract. What we don't often hear about is the very personal suffering of people who are under these severe austerity regime. Now joining us to talk about his experience and his family in Greece is Dimitri Lascaris. He's a lawyer. He's called to practice in New York and Ontario, Canada. He was a securities lawyer. He's worked in New York and Paris for a major Wall Street firm. He's acted on behalf of the country France. He's worked for Greece. He's worked for German development bank and numerous cross-border security offerings. He's now a securities class action lawyer based in London, Ontario. And I should add he represents investors and not the banks. Thanks for joining us, Dimitri.DIMITRI LASCARIS, SECURITIES CLASS ACTIONS LAWYER, CANADA: Thank you for having me, Paul.JAY: And for full transparency here, Dimitri's law firm is doing some pro bono legal work for The Real News as we sue people who have stolen our stories. But Dimitri, you've been on the phone with your sister, who was in Canada, is now living in Greece. What has she been telling you?LASCARIS: The stories that she's been telling me are becoming increasingly dire. You know, she was raised here. She was educated at the University of Western Ontario in Ontario. She left Canada in the '90s to marry a young Greek gentleman who lived in a village of about 1,000 people about an hour from Athens. And they since had four children. And when she arrived, Greece had not yet joined the euro. The euro didn't exist. It had the drachma. And life there was not as prosperous, not as comfortable as it was here, but there was a certain degree of stability and security, and overall, you know, in many ways a superior quality of life, from her perspective. You know, her husband had, at the time, a carpentry business, which he wanted to grow. And he decided to do that by investing a very large proportion of the family's wealth in German machinery, which he brought back at great expense to the family to Greece. And for a while his business was thriving. And then came the Greek financial crisis. Since that time, my sister describesâthere's been a steady deterioration in the family's quality of life.The first thing that [incompr.] was is in Greece families are very dependent upon private tutoring. The marketplace has always beenâfor jobs has been always quite competitive, and parents try to prepare their children to enter a difficult workforce. Of course, now it's become much more difficult. They couldn't afford to have tutors, so they got rid of those. Gradually their clients stopped being able to pay. Getting a client to pay even 5 percent of an outstanding balance was quite a stretch, because the clients were of course having to deal with their own debts. Many of them began to rely upon credit card debts to meet the basic necessities of life. And so the family's revenues largely dried up.Then there was an infiltration of crime, violent crime, into her village of about 1,000 people. One day she wasâvery recently, as a matter of fact, she was attacked outside her door by a drug addict and her money was stolen. She's been to the funerals of two friends from the village who were killed by assailants who were desperate for money. The family now is basically dependent upon assistance from other family members. She knows of people in her own village who have to scrape by with whatever the pensioners in their own families are able to give them. And the situation really is just one of going day-to-day and just trying to survive at this stage.JAY: And what's your sense from talking to your sister and other people, you know, that you have connection with in Greece about what they want? Do they want out of the eurozone? And they're kind of caught between a rock and a hard place, but it's going to be hard whatever they do. So what's your sense of what people want?LASCARIS: Well, people, I think, have had enough of austerity. There's no question of that. I think there is widespread and quite bitter resentment towards the European elites, and particularly the government of Germany. I had occasion to go to Greece myself in November of last year because my grandfather, who lived a very long life, suffered a stroke, and I wanted to be with him towards the end of his life. And I sat in a hospital room with eight other patients, with my grandfather, and they had a little television over his bed that everybody watched. And the room was largely silent one day, and Angela Merkel came on the screen, and there was just an outpouring of hostility towards, you know, the German chancellor. And I think people there have had enough of austerity.But at the same time, there is a very significant reluctance even stillâand it's quite remarkableâto abandon the euro. And I think that that really isâmy own impression is that that's a function of the indoctrination of the population by the Greek political elite. They've adopted the Hank Paulson mantra, you know, that if you were to depart from the global financial system or the financial system, the architecture that's been established in Europe, then of course an apocalypse will ensue. And people, they fear the unknown. But I think the lessons of past defaults and currency devaluations tells a different story. And to my mind the future of Greece really lies in a withdrawal from the euro and a return to the drachma and the reestablishment of national sovereignty, because that is being eroded at a dramatic rate on a daily basis.JAY: Well, speaking of national sovereignty, one of the provisions in the new deal the Greek government made with the European finance and political elite just a couple days ago calls for much more privatization. They're talking about airports and seaports, and previously they'd already been talking about things that had been tourist sites and islands. What seems to be on the chopping block? And what's your reaction to it?LASCARIS: Well, certainly the government is talking about selling infrastructure. It's talking about selling the national telephone company, which was something that was resisted for a long time. Basically, anything that can generate revenue, I think, is potentially at risk of being sold to private investors in the current environment. And what's really most troubling is that it's being done in circumstances where the government has very little leverage. And what is likely to ensue, and in fact what is unfolding, is a fire sale of national assets. And at the end of the day, people will look back at what's transpiring today and will say that they were sold out, actually betrayed by their leaders, the most important of whom isn't even elected by the people, Lucas Papademos.JAY: Now, you were involved earlierâand I read your resume a bitâin some privatization that took place in France. So why is that different than what's happening in Greece now?LASCARIS: I was working in Paris in the '90s, and at that time, the French government, I think, was much more conscious of maintaining national sovereignty, was much more progressive in nature. And so the privatization schemes that the government pursued at that time were much more modest. And rather than selling majority stakes and surrendering control over important industries to foreign investors and other private investors, the government was selling minority stakes and only doing so on a very targeted basis.What's going on here is really of entirely different scale. I mean, it really is just a broad-based firesale of national assets from every sector of the economy. And what's going to be left at the end of the day, if anything is left, is a rump of national sovereignty and a loss of control over people's destinies in Greece.JAY: Now, if Greece were to pull out of the eurozone, the argument goes that it would be just a sinkhole, that without these loans, the Greek economy would completely collapse, even though it's not likeânot that what's happening now is good, but it would be worse. So how do you envision that would work?LASCARIS: Well, first of all, the Greek economy has collapsed. The Athens News reported today that the GDP in 2011 experienced a record annual plunge of 7 percent. It's the fourth consecutive year of a deepening recession. Unemployment rates amongst youths have surpassed, I understand, 50 percent. The general unemployment rate is in excess of 20 percent. There was a rumor the other day that ATMs in Athens were empty, were running out. There are stories appearing in reputable media outlets that people are abandoning their children in the streets. I mean, it's really difficult to imagine a more horrific situation for the populace.What needs to be done is a currency devaluation. And within the eurozone, Greece does not have the ability to achieve a currency devaluation. And so what is being imposed upon the Greek people is a ruthless internal devaluation. The wages are being eviscerated and people are being impoverished. And at the end of the day, when, you know, what you've created basically is a large pool of extraordinarily cheap labor, you're going to see a race to the bottom in the broader continent, in my view. And eventually these policies are going to find their home in the heartland of the eurozone, in France and in Germany. And really what would be best is for Greece to withdraw and to engage in a currency devaluation to enhance its competitiveness by that means rather than by brutalizing the population through vicious wage cuts.JAY: Thanks for joining us, Dimitri.LASCARIS: My pleasure. Thank you.JAY: And thank you for joining us on The Real News Network.
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The following is a letter from Dimitri'ssister in Greece:
"Friends of ours have died of heart attacks, stressed to the limit by debt, or worse, the loss of their cars and homes"
Dimitri...the decline in our income and therefore in many facets of our lives began in the fall of 2009. In our family carpentry business, we began to go without work intermittently, but for longer and longer stretches as time progressed. Customers who owed us large amounts of money couldn't pay even 5% of the balance owing on their account. Our customers of course gave priority to the payment of bank loans they had incurred as first-time homeowners or for the expansion of their businesses, or worse, they gave priority to the payment of credit card debts they had incurred in order to maintain the quality of their life, or simply to secure the basic necessities...rent, water, electricity, health insurance and food. Slowly, cash has became more and more scarce for our customers, and therefore for us.
In Greece, the baby boomer generation has placed tremendous emphasis on education. In a very competitive job market, Greek parents sought to equip their children to secure a job as a civil servant. For that purpose, Greek parents commonly employed 'frontistiria' (or supplementary education through tutoring) as early as the onset of elementary school. The need to eliminate the financial burden of tutors was one of the first signs that people were struggling to survive.
Now, in 2012, whether in a city or a village, all you see strolling the streets is a succession of empty storefronts with rent signs and often a deluge of unopened mail just inside the door. The few businesses that have managed to stay open have gigantic banners proclaiming 50-70% reductions, hoping to catch the eye of the few potential customers out there. Walking through what used to be crowded and bustling markets now feel like a Sunday stroll through deserted urban centers.
Going to take care of business at The National Bank of Greece was once an all-day affair...most often now, you can zip in and out in less than 5 minutes. On the other hand, the line-ups to make payments at the Greek electrical company have become longer and longer. There you find very volatile crowds of people fighting with employees to defer payments through payment plans, or to have their electricity reconnected after having had it cut off as a result of the "haratsi," which is a government property tax incorporated into the electrical bill, often quoted by legal experts as one of the many unconstitutional acts this government has committed. What right does the electrical company have to assume the role of a tax collector, and to deprive us of electricity when we become unable to pay the arbitrary taxes issued at the drop of a hat to generate more money for the EU and IMF?
Suicides, drug abuse, prostitution and crime have infiltrated village life. In our village, which has slightly more than 1000 inhabitants, I was a victim of theft by a drug addict just outside my front door. I have been to the funerals of two friends who were murdered here in the village by their assailants when they were unable to produce money on demand. Other friends of ours have died of heart attacks, stressed to the limit by debt, or worse, the loss of their cars and homes.
We, as well as many people we know, are experiencing a strained home environment as a result of financial difficulties. Now we call our customers to beg them on a regular basis to pay something, anything, toward the debts they owe us, because food or heat in the dead of winter has become an issue for us. We now rely on help from family members. People we know go to retirees in their families to ask for contributions from their meager pensions. We are all now at the mercy of anyone with money at hand to help our family survive, let alone aspire to a better life.
At almost 52, when your stamina and endurance have started to wither away, life feels like a chore. However, children have a way of making you 'plug' back into life, even if it's only to focus on just one more day.
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