Published on Spiegel Online International, by Georgios Christidis in Athens, February 12, 2013.
He was hired to bring Greece’s debt statistics in line with European norms. Now, chief statistician Andreas Georgiou faces jail time for allegedly producing inflated sovereign debt numbers. He says he was merely being honest, and he has plenty of support in Europe … //
… Simply Overzealous?
But what would Georgiou have to gain by deliberately making the Greek economy look to be in even worse shape than it actually was? Georgiou’s detractors have a number of theories. Some say he was simply overzealous. University of Athens economics professor Yanis Varoufakis, for example, argues that: “When the whole world assumes that Greek statistics are always going to under-estimate the budget deficit, changing this reputation and impressing the world that things have changed meant one thing: getting it right or, since statistics can never be precisely right, issuing predictions that err on the side of over-estimation.”
That, though, is the most generous of the explanations currently circulating in Athens. Some argue that the technocrat Georgiou was serving his former superiors at the IMF and the European statistics agency Eurostat, which is led by a German. This theory holds that Greece was to be brought to its knees by imposing harsh austerity measures based on bloated deficit figures.
There is also no love lost between Georgiou and ELSTAT employees, with the union representing those workers having waged war against him almost from the start. It is telling that the union greeted the prosecution announcement with hardly concealed joy. “There is a moral obligation to remove ELSTAT’s chairman until there is a final ruling,” the union said. “It is beyond belief that ELSTAT should be led by a man of our creditors.”
Many say the charges against Georgiou are over the top, if not outright fabricated. Miranda Xafa, CEO of E.F. Consulting and a former member of the IMF executive board, told SPIEGEL ONLINE that “the investigation is motivated by a desire to blame the Greek debt crisis on external factors, such as speculators, bankers or austerity imposed by (German Chancellor Angela) Merkel and the IMF. Instead of investigating whether the Greek government understated the deficit before the crisis, they are investigating whether it overstated the deficit after the crisis!”
A Witch Hunt;
Even prominent opponents of policies pursued by Greece’s creditors, like professor Varoufakis, believe this is a witch hunt. Georgiou’s prosecution, he wrote in his blog, is an attempt to pacify the anger of government supporters with the ongoing austerity-driven economic problems “while staying the course with the same austerity policies that the Papandreou government first implemented three years ago.”
Mr. Georgiou’s line of defense is that most of the revisions that corrected the budget deficit from a projected 6 percent of gross domestic product in 2009 to a whopping 15.4 percent 12 months later were undertaken during the PASOK-led government of Georgios Papandreou. They also took place before Georgiou had taken up his post. Furthermore, Greece had already agreed on a bailout with its euro-zone partners and with the IMF before he took over the reins at ELSTAT. Under his leadership, the deficit only rose from 13.6 to 15.4 percent, a substantial revision to be sure, but irrelevant to Greece’s bailout.
Xafa says that all Georgiou did when he took over as head of the Greek statistical service was to comply with EU rules. She notes that nearly half of the revisions undertaken under Georgiou’s watch were the result of adding loss-making entities such as rail, public transport, defense and other sectors to the government books. “These losses were real and had to be financed, whether they were included in the deficit” or not, she says.
Georgiou himself feels that, if he is guilty of anything, it is for breaking with tradition and bringing the infamously dodgy Greek public finance records in line with EU standards. “Since taking up my post two-and-a-half years ago, the biannual publications of government deficit and debt statistics of the Greek statistics office have been accepted without any reservation by Eurostat,” he told SPIEGEL ONLINE. “All my energy is focused on preserving and extending this unprecedented track record for Greece with the upcoming release of public finance statistics in April.”
Sticking to the Truth: … //
… (full text).