ATHENS — After the capitulation of Greece this week to its creditor nations in Europe, Panagiotis Katsis, a retired accountant, did what he does best.
Under the harsh conditions of Greece’s $96 billion bailout, social security will be cut. The 65-year old calculates that will shave 45 euros — about $50 — off his 950 euro a month check.
Property taxes are also set to rise, so he’s budgeting for a hit of about 700 euros a year. Add creditors’ demands to raise national revenue through price increases on a host of foods — pasta, canned tuna, cereal, you name it — and he’s guessing 35 euros more on his monthly grocery bill.
“Europe thinks of Greece only as numbers,” said Katsis, who supports himself and his wife on his pension check. “Cut this. Cut that. But we are people, and we’ve had five years of this already. We’ve had enough.”
For 11 million Greeks, lean times are about to get leaner. As ordered by its creditors, Greece passed a rash of reforms early Thursday. As a result, the cost of life on many Greek islands — which enjoyed sales tax discounts about to be slashed — is set to go up. Many foods will be more expensive everywhere. Coffee bars will pay higher taxes. Retirees will shell out more for their medicines.
The Greeks are used to austerity by now. They’ve lived it since 2010, when, to secure this nation’s first bailout and avoid economic collapse, budget-slashing measures led to across-the-board cuts, including the firing of public servants and the introduction of new taxes.
The pain piled on in 2012, when a second bailout brought the bitter pill of even more austerity. Now, in the midst of a seemingly never-ending economic plunge more painful than the Great Depression, another dose of austerity is around the corner.
Yet many Greeks are not so much outraged as disillusioned. Disillusioned that Greece’s creditors — led by Germany — would drive such a hard bargain. Disillusioned with Greek Prime Minister Alexis Tsipras, the political maverick from the far-left Syriza party who vowed to just say no to European demands but ended up just saying yes.
Now, Tsipras has pushed through Parliament some of the most difficult cuts the Greeks have seen. Yet without the $96 billion bailout, it would have been worse. Greek banks faced imminent collapse and a messy exit from the euro currency union that could have sparked a brutal currency devaluation. So maybe it’s not as bad as it could have been. But in a long-suffering nation, that’s cold comfort for many Greeks.
This is a nation that, in some ways, is paying for its sins: for years of high tax evasion; for public overspending and a series of corrupt and inept governments. But after five long years, many here believe that they have paid enough.
“The agreement is unacceptable,” Tsipras’s rebel energy minister, Panagiotis Lafazanis, said Tuesday. “It doesn’t serve a radical party like Syriza, who promised the end of austerity. The creditors faced Greece like financial killers. With this agreement we cancel the result of the referendum.”
On Sunday night, Fratzeska Sklavou, 45, and her husband, Kosmas Thanasias, 52, were glued to the television set in their three-bedroom apartment with a peak-a-boo view of the Aegean Sea. European leaders led by German Chancellor Angela Merkel were wearing Tsipras down, threatening to let his country go bankrupt if he didn’t sign a harsh cash-for-cuts deal.
Tsipras had given his first major interview as head of his party at the couple’s Athens coffee shop in early 2008. They believed in him. They thought he would hold out.
Their interest in the summit was hardly casual. One of the austerity measures on the table was a higher tax for Greek coffee shops that was going to cost their business 1,000 euros a month.
The next morning, they awoke to discover that Tsipras had caved. “We didn’t blame him,” Sklavou said, sitting in the couple’s half-empty coffee shop on Tuesday. “They squeezed him. They gave him no choice. But right now, it’s hard to know who to blame. We’re just upset. More than upset, we’re feeling hopeless. Depressed.”
Like a majority of Greeks, the couple had voted “no” in the July 5 national referendum on another cash-for-cuts deal. Sklavou said part of her knew that it was always going to be fruitless. “So why did I say ‘no’? Because I wanted to make a statement. It was the Greek people shouting to the world. Saying that this is not fair. It was a cry for help. But they are not going to help us.”
The new tax on coffee shops will hit them when their business is already down 50 percent.
“We have three choices,” Thanasias said. “Cut our profits, which are already shrinking; increase prices and drive away our clients; or cut staff,” he said. “We’re going to go with option one.”
“For now,” Sklavou said, interrupting her husband as an idle waitress lingered nearby. “For now.”
For retirees such as Katsis, the new round of austerity means another choice. What to cut now?
After a 20 percent austerity cut to his pension in August 2012, he gave up his favorite hobby — brewing homemade wine — because he couldn’t afford the grapes and bottles anymore. With another hit to his pension coming, “there’s not much left to cut,” he said.
His wife doesn’t want to give up their monthly visit to the theater. So maybe it will be Katsis who gives up his occasional trips to the Aegean Sea to chat with friends over a glass of Greek ouzo. “It’s not so much the drinks I can’t afford,” he said. “It’s the gas.”
But that’s the price, according to Greece’s creditors, that the country has to pay to avoid something even worse. And if Katsis is one face of the pain of austerity, he is also an example of why some Europeans have driven such a bargain.
He is now 65. But under what had been one of the most generous retirement systems in Europe, he was able to retire in 2011, at 61. Among other changes demanded by Europe, come 2022, most Greeks will need to wait until age 67.
Katsis also voted “no” in the referendum. But like so many others who did, he doesn’t want cuts — but he also doesn’t want to leave the euro. European leaders say Greeks can’t have it both ways.
Although some have blamed Merkel, Europe’s taskmaster who has insisted on a hard deal, Katsis doesn’t.
“Look, she is fighting for her country,” he said. “I only wish we had someone in Greece who would fight as hard for us.”