I would like to very warmly thank the Center for European Studies for the invitation, Peter Hall and, of course, Elaine Papoulias for all her great support.
Today is the national day of Greece, celebrating the beginning of our war of independence.
I had the opportunity to celebrate our national day on Saturday with many Greek Americans but I’d like to take this opportunity to celebrate one of your fellow Bostonians who I think symbolizes what is best in relations between our two nations for the last two hundred years.
Samuel Howe was an American doctor who fought for the abolition of slavery, supported education for the blind and went to Greece to serve in the revolution as a surgeon.
He arranged for support for refugees and brought many Greek children back to Boston with him for their education.
So, in these difficult times I think we need to remember and be inspired by great figures like him, who bring us together.
It is safe to say that we are all seeing historical changes on a global level, that affect not only the geopolitical balance of power, or our societies, but democracy itself, particularly in the West.
After the war in Ukraine and especially with the re-election of President Trump, we are talking about a tectonic shift of the geopolitical framework formed after the Second World War.
It is clear that the international order constructed in 1945 was based on a specific balance of military power between the United States and the Soviet Union. But multilateral institutions such as the United Nations were also created. And international law was a reference point, even when it was violated. The war remained a Cold War despite local conflicts and after the 70s, opened up space not only for arms talks, but also for the Helsinki Act and the rise of the European Community itself.
The fall of the Soviet Bloc and the transition to a unipolar world under the dominance of the United States was an opportunity to expand on a more equitable liberal international order and a model of globalization that could lead to more sustainable and fairly distributed growth.
Ofcourse, we saw great growth and great technological progress after 1990, but the post-cold war, international geopolitical and economic order clearly led to very big crises and even bigger challenges.
I remember myself as a young student demonstrating against the war in Iraq.
And also demonstrating against rising inequalities, as well as the great threats created by the deregulation of financial markets.
A few years later we saw not only the failure of the War in Iraq, but also the way Lehman Brothers led to an unprecedented global and european economic crisis.
Unfortunately, western policy failures in the Middle East and Afghanistan left space for a stronger Iran to assert itself in the region.
At the same time, especially during the Bush presidency, the US underestimated the ability of Russia to assert itself following the enlargement of NATO.
Most importantly, it underestimated Russia’s warnings that it would respond militarily if NATO insisted on adopting an “open door policy” towards Ukraine and Georgia in 2008.
And we unfortunately see the situation today in Georgia and Ukraine after the invasion of Putin’s Russia.
We see that 20% of Ukraine is under Russian occupation and in the rest, there is a very aggressive negotiation by the United States for assets and rare earth minerals.
This focus on Eurasia and the Middle East left little space for what President Obama called the pivot to the Indo-Pacific region.
The messages of President Xi after his designation as President in 2012, were very clear that China would become much more assertive not only in the South China Sea, but globally, as it became stronger economically and technologically.
This is how we have gradually moved from a unipolar to a multipolar world in which the USA remains the most powerful force, but has lost its dominance.
And with the Trump Presidency, the USA is disengaging itself from any obligations towards Europe or a common Western strategy.
More importantly it is asserting that what is best for the United States is not to establish new rules for a new multipolar order, with international law as a reference point.
But a logic of “might makes right”.
And in this logic, it is clear that President Trump might attempt to divide Europe and undermine European cohesion through the use of tariffs and commercial deals.
So, what we need in order to face this challenge is to enhance the strategic autonomy of Europe while retaining transatlantic dialogue irrelevant of the future of NATO.
I believe strongly that Europe can and should use its Common Foreign and Security Policy, as well as its enlargement and neighbourhood policy, to play a role not only of deterrence but also as a force of peace and stability.
Particularly in regions where NATO should or cannot be present.
This means investing in defence, but also knowing what your strategic goals are.
So in Ukraine we need peace with the best possible terms for Kiev, we need an international peacekeeping force and we need Ukranians to have a choice for a european future.
We need a different western strategy in Ukraine, Georgia, as well as Moldova than the one we had since 2008. Which has failed.
A strategy where there is a commitment not to a NATO, but to an EU perspective for these countries. Particularly after a cease fire, we need to work on a different security architecture that includes tools that deter Russia and protect us from interventions, but also develop a framework for dialogue.
At the same time, the European leadership must send the message to the United States that transatlantic relations can develop only on the basis of mutual respect, respect for borders and non-interference in the internal affairs of European countries.
And Europe must also finally rise to the occasion in relation to Israel and the need for peace in Palestine, with an end to Israeli operations that have resulted in tens of thousands of civilian deaths, the immediate provision of humanitarian aid to the Palestinians and the resumption of talks for two states on the basis of UN resolutions.
The same is true for Turkey. We need a clear message to Ankara that what is happening today to Mayor Imamoglu is unacceptable and will have consequences.
We cannot convince anyone, particularly in the Global South, of our principles, if we prove to have double standards.
Secondly, in terms of the economy. We all know that economically and in terms of energy markets the US has benefitted from the war in Ukraine, in contrast to Europe.
On the last days we have seen the measures taken in Germany in relation to the debt break and a fiscal program totaling approximately €900 billion or about 20% of Germany’s 2024 GDP.
It is the largest fiscal expansion in Germany’s postwar history and hopefully marks a permanent break from Wolfgang Schauble’s ordoliberal mindset that prevailed in the past two decades.
In moments like this, it is hard to resist the temptation to imagine how different things would have been for Greece if this mindset had not dictated the conditions of the first two bailout programs 2010-15.
And remember what those conditions were:
- No upfront debt restructuring in 2010, to protect the interests of the German and French banks.
- An initially small financing envelope.
- A massive frontloaded fiscal consolidation with no protective measures for the vulnerable.
There is no doubt that such a stimulus will help Germany and Europe achieve faster growth in the coming years.
But also, projections suggest that, because of the stimulus, Germany’s debt-to-GDP ratio will rise steadily year-after-year to somewhere between 80% and 90% over the next decade – substantially breaching the 60% ceiling of the EU’s fiscal framework.
Remember, this is the ceiling that last year Germany insisted on maintaining, in the revised new fiscal framework.
In this context I have 4 policy proposals:
First, in order to maintain the credibility of Europe’s fiscal architecture, the fiscal framework should be revised as soon as possible, at least, raising considerably the debt threshold for everyone to around 100%.
And this revision should come before the deployment of Germany’s stimulus, if we want to preserve the credibility of Europe.
Second, I hope that Germany’s new fiscal approach will be leveraged in a way that benefits Europe as a whole, rather than being used to subsidize domestic firms, in violation of EU state aid rules.
If such a path were taken, countries with greater fiscal space would gain a disproportionate competitive advantage, deepening economic divergence within the Union.
Third – I have been saying it for many years now – Europe needs to supplement its common monetary policy with a federal fiscal instrument, a Treasury Department – just like the United States, and any other successful monetary union, does.
And this federal Treasury Department should be empowered to issue common European debt with the aim to finance the strategic autonomy of Europe on energy and defense; to facilitate the Green transition; to promote research and innovation; to restore Europe’s crumbling network infrastructure; and more importantly to increase social cohesion and reduce inequalities through investment in the welfare state and education.
I do not believe that the protection and enhancement of Europe’s public goods, should only come because of the pandemic, or now, because of the geopolitical reorientation of President Trump.
Issuing common debt is now becoming a necessary condition for the economic and political sustainability of the European project.
Finally, we need to listen carefully to the conclusions of the Letta and Draghi reports: Europe needs a deepening of its internal market, a new European industrial strategy to safeguard strategic autonomy, and bold action to increase research and development.
In this regard, I think that the ReArm Europe plan lacks a vision for a truly common foreign and defense strategy, relies heavily on national resources and therefore falls short of these two reports’ ambitions.
Most importantly, it cannot be implemented at the expense of cohesion funds.
A third issue we must face in Europe – closely connected to these economic questions – is the rise of the extreme right and its implications for the future of Europe.
In the last 15 years, the West has sunk into multiple crises that mainstream leadership has not been able to address.
Instead of accepting our mistakes and insisting on a framework of principles and policies to resolve them, conservative parties have adopted rhetoric and policies from the extreme right, to confront these challenges and keep their voters.
Center left parties have assumed elitist characteristics, disconnected from the economic needs and language of the working and middle class.
And Left parties have been absorbed by doctrine and petty politics.
In terms of the issues themselves, migration has been a big one.
This is another crisis that greatly affected Greece when I was Prime Minister.
A country that had just lost 25% of its GDP, was facing the entry of 1,2 million people in its borders, while a neonazi party had nearly 7% of the vote.
But we refused to carry out push backs at sea.
At the same time, we fought hard for a new EU-Turkey Agreement where migrants who did not receive asylum would be returned to Turkey.
And together with the EU we established a system where over 25,000 refugees were relocated to the rest of Europe.
We combined a humanitarian and a security approach.
But conservative governments today have focused much more on push backs than finding the right European mechanisms for a comprehensive European migration policy.
And they refuse to recognize the needs in labour workforce that Europe has.
Recently we had a terrible tragedy where hundreds drowned right outside of Pyllos in Greece.
Unfortunately, no steps have been taken for justice on this case two years later.
And here we come to another important issue related to the rise of the extreme right.
Mainstream governments have not fought enough, to protect the rule of law in Europe.
In many cases, they have abused the pandemic as well as malign software in order to strengthen their power.
In this way they have left space for the extreme right to highjack this discussion presenting rights and the rule of law as a useless burden or propaganda of the Left.
This trend is even stronger in the US, where unelected billionaires themselves, have a direct political role.
I think Ill stop here.
We have opened many issues and there is space for a lively discussion.
So thank you once again.