GREECE: Truth of the myths and the myths of the truth

If there is something positive from the financial meltdown it is the complete and total collapse of several myths: that there is no money for education (or health, or the environment, or pensions), and that the neo-liberal market can be self-regulating for the benefit of the consumer - to mention just two.

In one single night, two of the more robust economies in the world - the US and the EU - opened their coffers and made available billions of dollars and euros ($1.7 billion and EUR440 billion respectively) to the beleaguered banks and their 'golden boys' with their astronomical salaries and bonuses.

One would have thought that since sooner or later ordinary taxpayers around the world would be called upon to pay for this extraordinary state generosity given so liberally to the banks, economic ministers and chancellors (in the US and EU) would turn a more compassionate eye towards those more vulnerable members of the community who inevitably will bear the brunt in increased taxes, higher unemployment and economic recession.

Unfortunately, that is not the case. Those holding the state financial purse strings have again turned towards time-honoured (and failed) recipes. In Greece, the first thing Chancellor Alogoskoufis did was to cut 1% from education - a EUR280 million (US$358 million) cut - while in Ireland, Chancellor Brian Lenahan withdrew medical care from the over-70s and Minister of Education Batt O Keefe cut EUR96 million from education, meaning the number of pupils in classes will rise and no replacement teachers will be appointed.

Greek Chancellor Alogoskoufis went one step further. He announced a EUR28 billion handout to the banks and simultaneously increased taxation by EUR7.2 billion - to be paid by lower income workers, pensioners and freelance professionals.

Direct taxation has been shifted from the rich to the poor in the last five years as a result of measures taken by the present conservative government. Recently released figures by the Greek Statistical Service reveal that taxation was reduced for the rich from 56% to 36% and correspondingly increased for the poor from 36% to 56%.

Over the last five years, expenditure on education has gradually been reduced and current spending of 2.9% of GNP is the lowest in the EU. Yet for the last 30 years, opposition political parties have climbed to power promising to satisfy the long-term public demand for an increase for education to 5% of the GNP - a promise quickly forgotten once the politicians were in government.

Present official Opposition leader George Papandreou stated recently that if his party (PASOK) came to power he would increase spending on education to 7%, conveniently forgetting he was twice Education Secretary during more than 20 years of his party's administration (at least half that time headed by his own father, Andreas Papandreou, as Prime Minister) without implementing such a measure.

Since its election in 2004, the current government has done very little to support education in general, or higher education in particular. As a result, there has been constant dissatisfaction and unrest.

Current Education Secretary Evripidis Stylianidis, as well as his predecessor Marietta Giannakou, have done all they could to denigrate state universities (under-funding for courses and research, recognition of private colleges, assessment procedures and so on) in favour of private institutions, often of dubious academic quality, with parents bearing the cost.

Now, with the deflation of the neo-liberal myth that the market has a panacea for all the ills of the economy and as bankers, like so many latter-day Olivers, go cap in hand to the state asking for more, it is governments that are re-examining their orientation and their priorities.

Supporting the world's banking system to sustain the lifestyle of the 'golden boys' may be one way of stemming the current crisis. But an equal helping hand has to be given to the less privileged so the real economy does not grind to a halt with increased unemployment and the reduction of people's buying power.

Reducing spending on education can only harm the community. Much as the politicians might hate it, they should seriously consider a financial package similar to that extended to the banks so universities and higher education institutions through research and development could once again become the powerhouse for the improvement of the world economy.