In Greece, the truth may not set you free…
The curious case of Andrea Giorgiou continues to wind its way through the Greek judicial system, creating barely a ripple outside newsfeeds from Athens, nevertheless shaking the very foundations of scientific method, rational thought and sound government everywhere.
Citizens of every member country of the International Monetary Fund — and that’s just about everyone — should be outraged.
The basic facts are these.
After winning elections in 2009, the Greece’s new socialist government tried to untangle the desperately flawed system of public accounts to understand just how much it was spending and how much it owed. They estimated the actual budget deficit that year was 12.9 percent of gross domestic product, roughly triple the earlier forecasts. The following year, Dr. Giorgiou, an economist with a distinguished career at the International Monetary Fund, including as deputy director of its statistics department, agreed to return to Athens to help. As head of government statistics, he brought international practices to a badly flawed system and determined that the 2009 deficit was actually 15.8 percent.
Five years later, Dr. Giorgiou was swept up in a political maelstrom that landed him in an endless maze of legal woes, ostensibly on the premise that his statistical findings forced Greece to accept more onerous loan terms from European governments and the IMF. He appears to have fallen afoul of both allies of the previous government, who don’t want to shoulder the blame for Greece’s financial disaster, and allies of the current government, who are happy to feed the narrative of Greek victimization at the hands of international creditors.
Among several cases against him, Dr. Giorgiou was convicted last year of ‘violation of duty’ related to the publication of the budget figures without the approval of his agency’s politically-appointed (and non-professional) board. Greece’s Supreme Court will review a request to annul the conviction on March 2, and a ruling against him would make the conviction irrevocable.
There are two alternative outrages here. If the budget deficit was indeed inflated, this means that Greece borrowed more money than it needed in 2010 and should pay it back — with interest. If the numbers were sound — and they have been validated by European statisticians — then Greek authorities have trumped up a range of charges that are outrageously unfair to Dr. Georgiou and will intimidate any future statistical service from accurately measuring the country’s economic activity.
The details of the case have been compiled by the Friends of Greece, a group of concerned economists and policy analysts (including this one) who want nothing more than to see Greek leaders succeed in returning their country to a path of sustainable growth.
Evidence overwhelmingly points to the second story line, which casts a cloud over Greek efforts to return to borrowing from financial markets in the months ahead and an even larger cloud over the reliability of European statistics in a future crisis. It is also an insult to anyone who believed that 21st century public policy should be based on facts or anyone who thought Europe’s courts were free from political vendettas.