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Inside The Greek Tragedy

A Greek magazine journalist — who’d been part of the high life — gives a very personal account of her beloved country’s economic downfall.


You had to be someone special to be on the guest list for the legendary parties that the eccentric designer and businessman Lakis Gavalas gave at his villa in Mykonos to celebrate the beginning of every summer. If you had the right connections, you could find yourself sitting next to Dolce & Gabbana (Domenico and Stefano) or the sons of Muammar Gaddafi. You’d meet Greek celebrities, Italian supermodels and the beautiful wives of Greek tycoons.

But this year, there will be no party. Lakis Gavalas is in jail for tax offences and his villa has been seized by authorities. (A style icon even on his way to jail, he was arrested wearing a €2,500 outfit.)

<p>Photo by Tullio M. Puglia/Getty Images</p>

Photo by Tullio M. Puglia/Getty Images

Lakis Gavala during Milan Fashion Week, on January 17, 2011 in Milan, Italy.

Many of the Greeks who once attended Gavalas’s parties are now either broke or playing it broke, having stashed most of their money in secret bank accounts in Switzerland or offshore, in companies in the Cayman Islands or the British Virgin Islands. They are the people who used to pay €50 to rent a sun-bed in fancy Psarou Beach in Mykonos, and thousands of euros to eat sushi, drink Champagne and show off their yachts while the paparazzi captured the moments for OK! and Hello magazines.

During last month’s Easter holidays only one big yacht sailed to Mykonos (it belongs to Konstantinos Tsakiris, a shipping magnate, banker and former sports team owner); the rest of the rich and famous were nowhere to be seen. In an attempt to be as unprovocative as possible, the wealthy are staying home and hosting only small gatherings that don’t include reporters for the social pages. They drive smaller cars (the fancy ones stay in the garage), and they plan to spend their summer holidays on islands not easily accessible to the paparazzi. It is said that, this summer, the place to be is the island of Patmos; get there by helicopter or private yacht, otherwise it’s a 12-hour ferry ride.

Lakis Gavalas SA, the company, had the exclusive rights for Burberry, Dolce & Gabbana, Dsquared2 and other luxury labels in Greece; it also made clothes and accessories under the brand LAK. When the company filed for bankruptcy and the owner/designer was imprisoned, more than 200 people were left without a job. Smaller companies holding contracts with Gavalas SA subsequently lost all of their money, creating a domino trail of businesses gone bust.

During last month’s Easter holidays only one big yacht sailed to Mykonos; the rest of the rich and famous were nowhere to be seen.

On the other side of the coin, even companies that haven’t lost a single euro are cutting salaries and laying off employees in the name of the financial crisis. They do it because now they can. One of the first things the troika of the International Monetary Fund, European Central Bank and European Union asked of the Greek government in exchange for its bailout was to cancel the National Labour Agreement signed by the unions and the companies to protect workers’ rights and their salaries.

In economically challenged times such as these, the very rich know what to do to become even richer — a famous Greek shipping magnate confessed that for him it would be good if Greece came out of the Eurozone and went back to drachmas, because he had all his money safe in European banks. The Greek poor, meanwhile, are fulfilling the expectation that they’ll become poorer, in a country that was never ready or able to take care of those in need. And somewhere in between, are those who thought they were rich, but whose businesses were based on bank loans; they are becoming less rich or, in some cases, going broke.

<p>LOUISA GOULIAMAKI/AFP/Getty Images</p>

LOUISA GOULIAMAKI/AFP/Getty Images

A man walks past a shop in Athens offering to purchase gold and jewellery for cash on December 8, 2011.

The truth is that none of us Greeks saw it all coming. The news of the American financial crisis in 2008 was received like any other news coming from the US. It caught our interest as much as the Kardashians’ life on reality TV did; sure, it sounded bad, but it was far away.

During the 2009 Greek elections, Giorgos Papandreou, leader of the socialist party PASOK (and son of the party’s founder, Andreas Papandreou) was elected Prime Minister under the slogan “There is money”. The 43 per cent of Greeks who believed him would one year later see him sign the austerity memorandum with the International Monetary Fund, which brought into force the most difficult austerity measures any European country has ever undertaken. When Greece went to the polls on May 6, PASOK, unsurprisingly, won only 13 per cent of the vote. The party was officially over.

Even companies that haven’t lost a single euro are cutting salaries and laying off employees in the name of the financial crisis.

It had been a party to which most of us had been invited. Not only does exuberantly shouting “Opa!” run in our Greek blood, but the whole financial, political and social system added fuel to the festive bonfire. Banks, for example, were giving away loans, asking for almost nothing as a guarantee; to buy a house or an expensive car, all you had to do was ask, and a loan would be granted.

As we know, you can’t call a party a success without pictures to prove it. So for the past 15 years media companies gorged and grew fat at the buffet of paradisical projections and played back what we wanted to see. Six major private television stations and three public TV stations, more than 20 weekly magazines and some 60 monthlies, numerous radio stations and newspapers big and small in this country of 10 million residents, presented a glittering picture of Greek prosperity.

<p>Photo by Oli Scarff/Getty Images</p>

Photo by Oli Scarff/Getty Images

A homeless man is given money as he sleeps under a blanket on February 19, 2012 in Athens, Greece.

The media company Imako, founded by the media mogul and one of Greece’s most influential journalists, Petros Kostopoulos, 58, had 350 workers, as well as a stable of freelance journalists, photographers and contractors. Kostopoulos started with two magazines and one radio station in 1996. Fifteen years later he had three radio stations, two websites, three weekly and eight monthly magazines including the Greek editions of international Esquire, In Style, People, Car, Fortune and Maxim. A man of good taste, he built a very beautiful house in the expensive suburb of Filothei and had a summer house in Mykonos. And as the posh Lakis Gavalas hired a handsome driver for his Rolls-Royce, Kostopoulos drove himself in a sexy Porsche or rode a Harley-Davidson.

Imako closed three months ago; 350 people, most of them used to earning a good living, became unemployed. A modelling and photographic agency that was collaborating with Imako, and other similar businesses, followed suit. The radio stations and all of Kostopoulos’s assets are in the hands of the bank. The man who might be said to have invented the “new Greek lifestyle” is unlikely to go to Mykonos this summer; his house there, like all his other assets, was seized and belongs to the bank now.

She has had to sell her wedding jewellery and book collection to pay her bills. She was lucky — not only that she had something to sell, but also that she found someone interested to buy.

IMAKO is not the biggest media company to have closed down. The historically liberal well-established newspaper Eleftherotypia stopped publication four months ago, along with the conservative Apogevmatini and the television station Alter. Alter’s workers sought to save their jobs in the most dramatic way, striking and occupying the signal, broadcasting their protest. The owner of the television station was arrested in early April, 2012, for tax offences. During his arrest, he announced that Alter would never broadcast again.

It is estimated that more than 4,000 people have lost their jobs in the media over the past two years, and the pain runs deep. One journalist who was an Alter TV personality and also worked as a writer for one of the newspapers that closed, lost two jobs in one day. With two children to support, she has had to sell her wedding jewellery and her book collection to pay her bills. She was lucky — not only that had she something to sell, but also that she found someone interested to buy.

<p>STR/AFP/Getty Images</p>

STR/AFP/Getty Images

An immigrant takes cover while members of the 'Golden Dawn' ultra nationalist group throw stones towards a building where illegal immigrants squat in Athens on May 9, 2009.

The lack of an outcome in the recent election is proof of the chaos in which Greeks are living. The two major political parties that signed the loan-and-austerity memorandum, PASOK and Nea Dimokratia (New Democracy), lost almost 30 per cent and 15 per cent of their voters respectively; Siriza, the left-wing party led by the charismatic 37-year-old Alexis Tsipras, trebled its vote to 16.8 per cent. Tsipras is against honouring the memorandum, saying that Greece should renegotiate.

The good-looking Tsipras is also introducing Greeks to a completely different take on the lifestyle of a powerbroker. In contrast to most political leaders, who live in the expensive areas of Kifisia, Kolonaki and Glyfada, he and his wife, who keeps a low profile and is pregnant with their second child, live in an apartment in the working-class neighborhood of Kipseli.

But if you thought Tsipras’s working-class neighbours were his electoral supporters, you’d be wrong. The majority of the poor residents of downtown Athens voted for the neo-Nazis and the Golden Dawn, a political party that supports mass deportation of illegal immigrants. With its slogan of “Greece belongs to the Greeks”, Golden Dawn promised to force out of the country almost one million illegal immigrants who live in the centre of Athens. Golden Dawn’s flag, with an ancient Greek symbol very similar to the Nazi swastika, inspired 7 per cent of the voters to vote for the party, with the result that 21 admirers of Hitler will now sit in the Greek Parliament. The party’s secretary-general, Nikos Mihaloliakos, said in a TV interview that no one can claim with certainty Hitler’s gas chambers really existed. Party spokesman for the Golden Dawn, Elias Kasidiaris, is accused of attempted murder and his trial is scheduled for June. Since their election, the members of Golden Dawn have opted to call themselves nationalists.

As I write, negotiations continue between Greece’s political leaders, as they try to establish a government that will keep the country in the common European monetary zone. But the people of Greece aren’t really paying attention. You see, the Olympiakos basketball team, all but written off earlier in the season, has just won the Euroleague title in Istanbul, beating the team considered undefeatable, Russian CSSKA. Olympiakos was the outsider — its players are young and the team is new. Nobody believed the Greeks could win. But they did, by just one point. At the very last minute.

Nancy Zampetoglou has edited weekly magazines in Greece for more than 15 years. She recently joined the Greek newspaper Proto Thema as a journalist. She was the founding editor of People Greece, published by Imako.

2 comments on this story
by Daniel

Very exciting news with Greece. Very exciting election results and lets hope the country goes further to the left. If they have to drop the euro so be it.

May 24, 2012 @ 10:44pm
by Constantine

Nancy Zambetoglou article-

So, some of the corrupt rich have ended up in jail! Well, well, what about the corrupt politicians who either took liberties to feather their own nests, or were disinterested in the corruption that has been endemic all around them? Why are we not talking about them?

June 3, 2012 @ 7:29pm
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