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Euro or No, Economics of Everyday Greek Life Is Eroding

Gregoris Skouros stepped out of the sawed-off cargo container that hard times have forced him to make his home in on an agricultural plain near this tiny village, a two-hour drive south of Athens.

View over the caldera of Santorini in Greece.
Tom Pfeiffer | Getty Images
View over the caldera of Santorini in Greece.

When a visitor raised the issue on everyone’s minds — Greece’s future in the euro zone — Mr. Skouros pursed his lips for a long moment before speaking.

“The problem has now gone beyond whether we remain in the euro or not,” said Mr. Skouros, 54. “The issue is, Can Greece be fixed?”

That question has taken on new urgency as Prime Minister Antonis Samaras makes a renewed effort this week to assemble an austerity budgetpackage that can persuade Greece’s creditors to release a 31.5 billion euro ($41.1 billion) loan installment for the country in October. Even now, auditors from Greece’s troika of international lenders are examining the books in Athens to determine whether the country is on track to repair its tattered finances.

But even if Greece receives yet another lifeline from its European partners, many Greeks have reached their own conclusion: It doesn’t matter.

While the economics of everyday life continue to erode, the big concern is that Greece’s leaders are doing almost nothing to root out deep-seated problems that hobble a return to growth, including bureaucracy and bribery.

That dark public mood — also evident in widespread work stoppages in Greece this week and a general strike planned for next week — could make it all the harder for Mr. Samaras’s government to push through Parliament his 11.5 billion euro package of austerity measures. A budget deal could be the country’s last, best hope for getting the next round of international loans it needs to stay part of the euro union.

Recognizing the domestic political challenges facing Mr. Samaras, whose shaky three-party coalition came to power in June after two national elections, European officials seem willing to give him a bit more time. European finance ministers meeting in the Cypriot capital of Nicosia last weekend signaled that willingness, and on Monday so did the German chancellor, Angela Merkel. Given the political alternatives in Greece, European leaders might see little choice but to continue betting on Mr. Samaras.

Right now, in fact, it may be the increasingly impatient Greek public that is the prime minister’s bigger challenge. The popularity of the neo-fascist Golden Dawn party, which won 18 parliamentary seats in the last election, has climbed in recent weeks. The main leftist opposition party, Syriza, is now virtually tied with Mr. Samaras’s New Democracy party in the polls.

Mr. Skouros, who voted for the socialist Pasok party that was ousted from power this year, said he was no longer sure for whom he would vote if elections were held yet again.

“The problems of Greece are so widespread,” he said, shielding his eyes from a blazing sun as he looked across the stretch of farm country that he now calls home. “It would take a Marshall Plan with outside inspectors coming into every government operation and looking over people’s shoulders to make sure that change really happens.”

The Greek economy, already in the fifth year of recession, has slumped even further in recent months as a series of earlier state salary and spending cuts, together with sharp tax increases, take their toll on an austerity-weary public.

Growth contracted 6.2 percent in the second quarter and is expected to decline nearly 7 percent this year, far worse than the 4.2 percent forecast just a few months ago by the so-called troika of international lenders: the International Monetary Fund, the European Central Bank and the European Commission. Unemployment rose to 23.6 percent last month.

With the Samaras government’s latest proposals to cut state salaries and pensions even more, Greeks — including doctors, firefighters and large swaths of the national police force — have taken to the streets. So far the demonstrations have been peaceful.

But some people are bracing for the possibility of civil unrest on Sept. 26, when a planned nationwide strike is expected to bring things in Greece grinding to a halt.

While Mr. Samaras has promised that this latest austerity package will be the last round of cuts on his watch, critics say the bigger issue is that too little is being done to rehabilitate the competitiveness of the Greek economy or attract foreign investment. The troika has been signaling as much by insisting that the government take bolder steps to slim the bloated state sector; clamp down on waste, inefficiency and corruption; and reduce the thickets of administrative hurdles that stifle entrepreneurship in Greece.

Mr. Skouros agrees. Without fundamental changes, he says, Greece may have little hope of being anything more than a ward of the European state for years to come.

He speaks from experience, having run the Greek gantlet when he tried to restart his life two years ago.

That was after the elevator parts and service business he had owned and run in Athens for a decade began slumping along with the economy, after the extent of Greece’s debt crisis became evident. He and his son, Tassos, 24, looked for ways to make a fresh start.

After studying a variety of business prospects, Mr. Skouros moved in 2010 to this vast agricultural swath of Arcadia to set up a snail-farming enterprise. Escargots, it turns out, can be a lucrative export, snapped up by the truckload as a culinary delicacy by restaurants and shops in Italy and France.

To save money, he settled into a trailer that he combined with half a cargo container to make his homestead on a small plot he bought, joining a rising number of urban Greeks who are returning to the countryside as jobs and business opportunities dry up in big cities.

But Mr. Skouros faced obstacles from the get-go. Escargots might be a potentially lucrative cash crop, but banks would not take the risk of lending to him. And obtaining a business permit turned into its own 18-month odyssey, with numerous visits to government offices and the occasional request for bribes.

“In Greece, it has always been the case that you pay a bribe — to get your driver’s license, at the hospital, and even when starting a business,” he said. “Now things have gotten so bad, the trend has become even worse.”

He said the corruption and nepotism that the troika had also identified as hurdles to reviving the economy were all too apparent even here in rural Greece.

In many agricultural regions, it is not uncommon for people with Civil Service jobs to grow crops on the side while continuing to collect their pay from the state. He spoke of one man who often tended to his tomato crop during the summer instead of going to work in the office where he was a civil servant.

The tomatoes bring in an estimated 25,000 euros a year, much of it collected in cash to avoid paying full taxes.

The local tax collector was a close friend of the man, “so it’s no wonder that full taxes are not imposed,” Mr. Skouros said. “In the meantime, this man is getting a paycheck from the state even while he is working in the field.”

Mr. Skouros said he was not certain the Samaras government — or any government, for that matter — would be able to surmount the culture of corruption that taints even the most basic functions of Greek society. As it is, he said, the prime minister now seems more focused on an international audience than on his country’s own voters, trying to forge the austerity plan that will placate the troika and begin repairing the international reputation of Greece.

Fingering an escargot shell in his palm, Mr. Skouros said he still hoped his business would take off. But so far, given all the delays, he said he had not yet been able to start exporting or generating any revenue.

He cast a long, silent stare across the farmland. Whether or not Greece stays in the euro, or gets yet another lifeline from the troika in the coming months, he finally said, corruption, bribery and bureaucracy are weighing on Greece even more than the debt on which outsiders are so fixated.

“Are we ever going to be able to change things?” he asked. “Probably not without a revolution.”