Combating Greece's Desperate Loss of Hope

Though Greece's precarious economic situation may be stabilizing, the populace is still losing hope in the future. Recent financial reports on Greece and the release of €34.2 billion in aid payments by international lenders after months of negotiations indicate somewhat promising economic news. Yet Greeks are the most pessimistic in the world about the direction of their lives, according to Gallup research in 148 countries in 2011. And more than four in 10 Greeks expect their lives to be worse in five years than they are now -- the definition of despair.

A formula for mass unrest

Gallup observed a similar decline in hope in Tunisia and Egypt prior to the Arab Spring uprisings, which occurred during an economic backdrop of growing GDP per capita. Greece has lost more than 20% of its economic output (adjusted for inflation) since 2007. This is close to four times the contraction experienced by Ireland, Spain, Portugal, and Italy, and continued recession in Greece is likely next year. Only 3.7 million people have jobs out of a total population of 11 million, and the Greek economy has shed 900,000 jobs in the past 48 months. The conditions are present for sustained mass civil unrest.

According to Gallup's research in 2011, 24% of the world's adults rated their lives well enough to be considered thriving, while 63% were struggling and 13% were suffering. At the same time, a higher proportion of Europeans (a median of 14%) were suffering than anywhere else worldwide, just ahead of adults in Africa (13%) and higher than the 11% in Asia and 6% in the Americas.

The overall European figures encompass a wide range of results, with western Europe and the Nordic countries enjoying some of the highest levels of well-being in the world, while Bulgaria, Romania, and now Portugal and Greece cope with some of the lowest levels. In July, a relatively low 14% of Greeks were thriving, while 26% were suffering. The latter figure is equal to that in Afghanistan, a country that has been at civil war for 12 years.

The difficulties inherent in sustaining a common monetary policy in the eurozone across 330 million people with different levels of productivity and indebtedness are complicated by the extreme range in national mindsets. People's ability to bounce back from adversity and their response to the new realities that the structural changes associated with the bailouts produce will be an important consideration for southern Europe's growth potential.

The European Union (EU) and European Central Bank raise the stakes higher still by opting to front the push for austerity measures themselves rather than the International Monetary Fund. This is incendiary politics. Brussels-based EU bureaucrats are spared the full force of Greeks' wrath possibly because Greeks deem EU oversight of Greece's politicians and government necessary; only 13% of Greeks have confidence in their national government. However, many Greeks feel -- and are stoked remorselessly by the popular press -- that Germany is once again subjugating the country. What's more, nearly half of Germans want Greece to leave the eurozone.

What leaders can do

What can Greek Prime Minister Antonis Samaras, German Chancellor Angela Merkel, and other EU leaders do to re-energize the Greek population and increase willingness to deal with the deep structural changes the country so desperately needs? Gallup's multicountry research on what people need from their leaders provides a solid guide: These leaders must meet their followers' four basic needs for trust, compassion, stability, and hope:

1. Greek and EU leaders must create trust by speaking openly and honestly about their options -- free from obfuscation and dithering -- then follow through on what they say. High-profile EU gatherings devoid of substance where leaders make shrill cast-iron predictions about a future they cannot know is invariably discouraging people's confidence and trust in their leaders. Greek and other EU leaders only increase Greeks' feelings of helplessness when they avoid discussing the possibility of the country leaving the eurozone or that Greece has coped with bankruptcy five times in the past two centuries. Meanwhile, Greece's economy continues to implode; its effective poverty rate has risen to 36%, according to Manos Matsaganis of the Athens University of Economics and Business.
2. EU leaders need to show compassion through their rhetoric and their actions. Continuing to relentlessly push a message of open-ended austerity, no matter how vital in the medium term, when people are utterly at a loss will end in ugliness. Europe has too many examples from the previous century of what countries will do when they feel they no longer have options. Leaders should acknowledge bright spots in Greece's progress: The country is on course to achieve a primary budget surplus (net of servicing debts), which is a long-delayed but nonetheless herculean milestone considering the state of the country's finances a few years ago and the precipitous fall in GDP.
3. Leaders need to move the conversation beyond the cataclysmic language of austerity so people can find stability and hope -- and start to embrace and plan for the future. Leaders in Greece should focus on how to start rebuilding the economy and the types of new skills that will be required to do so, stress that purging the country of corruption and tax avoidance will lead to a stronger meritocracy, and underline that Greece will remain a vital part of the EU regardless of whether it remains a member of the eurozone. At some point in the future, leaders must address how to wean Greece from the financial life support of the EU, which the country has been addicted to since joining the EU in 1981.

Greece has been the EU's canary in the coal mine since the start of the Great Recession. For many Greeks, the flame of hope is barely flickering now. Leaders must move swiftly to prevent it from extinguishing -- not only for the sake of Greece but also because once national despair takes root, the consequences are unlikely to stop at Greece's borders.

NOTE: Gallup classifies respondents' well-being as thriving, struggling, or suffering according to how they rate their current and future lives on a ladder scale with steps numbered from 0 to 10 based on the Cantril Self-Anchoring Striving Scale. People are considered thriving if they rate their current lives a 7 or higher and expectations for their lives in five years an 8 or higher. People who rate their current or future lives a 4 or lower are classified as suffering. All others are considered "struggling."