King of handouts

Alexis Tsipras, Greece’s leftist prime minister, has turned out to be the king of handouts. Every now and then, his government will cut spending on social welfare or restrict the public investments program in order to spend money in areas that could boost his chances of being re-elected. You can almost hear ruling officials saying: “We shall grant a 350-euro supplement to pensioners. We could also label it ‘the 13th pension.’ It’s a nod to the elderly that the government is on their side. We shall also give a 400-euro benefit to some unemployed people in the 18-24 age group and – you never know – they might pay us back when they head to the ballot box.” SYRIZA folk are sticking to unbearably old-fashioned politicking and vote-grabbing policies. After all, what could go wrong in mimicking the tactics that once helped their predecessors? The problem is that after eight years of brutal austerity, the Greece of today bears no resemblance to the country of the golden decades of the 1980s and 1990s when money still existed, to paraphrase former prime minister George Papandreou. Currently, there are more than a million unemployed in Greece, 70 percent of whom have been out of work for at least 12 months. These people are receiving zero in unemployment benefits and they are in dire financial straits. Furthermore, Greece’s industrial decline continues as the government’s tax raid is taking its toll. Whereas eurozone countries are projected to grow by an average 2.5 percent this year, Greece, hit by years of recession, is expected to achieve a growth rate of just 1.5 percent. Every million that the government takes away from public investments means fewer jobs in the real economy. At the same time, every million that is labeled “social dividend” before being offered as a bonus has zero effect on the real economy. The 2 billion euros that Tsipras’s government spent on bonuses (617 million in 2016 and 1.4 billion euros in 2017) for more than 1.5 million pensioners could have created 200,000 – partly subsidized – jobs in the private sector. All those unemployed people could have finally found a decent income. Meanwhile, their work could have helped raise economic productivity. “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime,” the old Chinese proverb goes. Too bad Tsipras would rather hand out fish. Especially at a time when New Democracy is polling at least 10 points ahead of SYRIZA.