The other day I was out for a morning walk, and made my way past a beautiful golf course that held a small development of homes, most manicured and well tended. At the end of the block, I noticed one home that appeared empty, with a piece of white paper stuck on the front door. Curious, I made my way up the sidewalk to the door, and saw that the paper was a notice from a bank that the home had been foreclosed. From the inside, brown paper was taped over the windows, but I found one window where the paper had fallen to the floor. What I saw shocked me.
In the kitchen, the countertops had been wrenched from the cabinets, leaving huge tears in the cabinets, defacing and likely ruining them. All of the light fixtures, fans and other items were removed, and there were various holes in the walls of unknown purpose. I had seen such activity before on television, in homes in Las Vegas, Phoenix and elsewhere, but was shocked to see it myself first hand. What would cause the behavior to cause harm to the home? Revenge on the bank? Frustration at oneself for a bad investment? Sheer anger at the “system’ for causing a foreclosure? Embarrassment? I am not sure.
The global economic downturn continues to grind on, and there are actually signs that many countries and regions are beginning to fall back into recession after very tepid recoveries. We catch headlines of cryptic symbols and data points which economists, pundits and politicians fret over, but we are often unsure of what it all means. A colleague of mine has articulated the principle of “frugality fatigue” where large segments of populations simply shrug at continue thriftiness in the midst of no improvement of their economic situation, and begin to return to old habits of spending pre-recession. And while the economic challenges Americans face can be painful and even wrenching, in most instances they have not turned into tragedy. The same cannot be said of some other parts of the world.
In Greece, the focus of so much commentary and conversation of the past months, it has been lost on most of us that there is a higher cost for many Europeans. When Apostolos Polyzonis's bank refused to see him last September, the 55-year-old Greek businessman had just 10 euros ($13) in his pocket. Out of work and bankrupt, he thought all he could do with his remaining money was to buy a gas can. Desperate and angry, Polyzonis stood outside the bank in central Thessaloniki, in northern Greece, doused himself in fuel and surrendered to the flames. There are many reports of a rapid rise in suicide rates throughout all of Greece. For Spain, unemployment for those under 25 years of age has now climbed to approximately 50%, a stunning number by any possible measure. The same data point for Portugal, Italy and other countries, including those in the more prosperous northern European countries, is often beyond 30%, with a resultant rapid rise in civil unrest by these same young people.
In a recent New York Times article, Nobel Prize winning conomist Paul Krugman moved beyond the scope of individual suicides in Europe, and wonders if the larger story isn't so much about individuals as about the apparent determination of European leaders to commit "economic suicide" for the continent as a whole. Much of the European economy is contracting, and Krugman claims that “Instead, they doubled down on their failed policies and ideas.”
There are certainly positive merits and attributes to the European experiment of the E.U. But in my view, the diminishment of the free market and the corresponding destruction of the entrepreneurial mindset in most of Europe (much of it through ‘top-down’ economic policies, banking restrictions, social norms and restrictions, with resultant emigrations to other countries), makes me hope that the response to the economic situation can soon begin to move past the failed policies of austerity. We need to encourage self-sufficiency, reasonable risk taking, and a freer marketplace for entrepreneurial ideas. And non-profits, ministries, NGO’s, many of them based in North American, will likely need to modify some of their policies, procedures, visions and goals as well to adjust to the needs of the people in the countries in which they serve.
It is not too late to take steps to reduce the true and tragic cost of the economic downturn but it will take new levels of collaboration and cooperation that does not presently exist. Friends of Portugal hopes to be a part of this effort towards a new Europe, composed of stronger and more economically vibrant countries, including Portugal. Will you join us in this journey?
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