George A. Papandreou is the former Prime Minister of Greece (2009-2011) and is currently a Member of Parliament with the Panhellenic Socialist Movement/Movement of Change. As an MP, he represents the Hellenic Parliament in the Parliamentary Assembly of the Council of Europe and has led over the years the work of several Committees in producing recommendations for the deepening of democracy, human rights, and the rule of law across its 47 member-states.
During his premiership, he applied a series of structural reforms in his attempt to modernize his country whilst avoiding bankruptcy during Greece’s 2010 debt crisis. For his achievements related to government Transparency, he received the Quadriga Award in the category “Power of Veracity.. In 2010, he was named one of the Foreign Policy magazine’s TOP 100 Global Thinkers. In 2017, he was honored with the International Leadership Association (ILA) Distinguished Leadership Award.
Dr. Ron Heifetz is among the world’s foremost authorities on the practice and teaching of leadership. He speaks extensively and advises heads of governments, businesses, and nonprofit organizations across the globe. Heifetz founded the Center for Public Leadership at Harvard Kennedy School where he has taught for nearly four decades. He is the King Hussein bin Talal Senior Lecturer in Public Leadership. His research addresses two challenges: developing a conceptual foundation for the analysis and practice of leadership; and developing transformative methods for leadership education, training, and consultation.
Dr. Cynthia Cherrey is President and CEO of the International Leadership Association (ILA), a global community committed to increasing quality research, teaching, and leadership practices contributing to the world's common good. As president of a multi-sector and global professional association, she promotes rigor and relevance of leadership at the intersection of theory and practice. Previously, Cynthia was Lecturer in the Woodrow Wilson School of Public and International Affairs and Vice President for Campus Life at Princeton University.
A Quote From This Episode
About The International Leadership Association (ILA)
About The Boler College of Business at John Carroll University
About Scott J. Allen
My Approach to Hosting
George A. Papandreou is the former Prime Minister of Greece (2009-2011) and is currently a Member of Parliament with the Panhellenic Socialist Movement/Movement of Change. As an MP, he represents the Hellenic Parliament in the Parliamentary Assembly of the Council of Europe and has led over the years the work of several Committees in producing recommendations for the deepening of democracy, human rights, and the rule of law across its 47 member-states.
During his premiership, he applied a series of structural reforms in his attempt to modernize his country whilst avoiding bankruptcy during Greece’s 2010 debt crisis. For his achievements related to government Transparency, he received the Quadriga Award in the category “Power of Veracity.. In 2010, he was named one of the Foreign Policy magazine’s TOP 100 Global Thinkers. In 2017, he was honored with the International Leadership Association (ILA) Distinguished Leadership Award.
Dr. Ron Heifetz is among the world’s foremost authorities on the practice and teaching of leadership. He speaks extensively and advises heads of governments, businesses, and nonprofit organizations across the globe. Heifetz founded the Center for Public Leadership at Harvard Kennedy School where he has taught for nearly four decades. He is the King Hussein bin Talal Senior Lecturer in Public Leadership. His research addresses two challenges: developing a conceptual foundation for the analysis and practice of leadership; and developing transformative methods for leadership education, training, and consultation.
Dr. Cynthia Cherrey is President and CEO of the International Leadership Association (ILA), a global community committed to increasing quality research, teaching, and leadership practices contributing to the world's common good. As president of a multi-sector and global professional association, she promotes rigor and relevance of leadership at the intersection of theory and practice. Previously, Cynthia was Lecturer in the Woodrow Wilson School of Public and International Affairs and Vice President for Campus Life at Princeton University.
A Quote From This Episode
About The International Leadership Association (ILA)
About The Boler College of Business at John Carroll University
About Scott J. Allen
My Approach to Hosting
Okay, everybody, welcome to the Phronesis podcast. Thank you so much for checking in, wherever you are in the world. We have three very, very special guests today, excited for this conversation. I am not going to do long bios in this intro because I want as much time as possible for you all to hear the conversation. Their longer bios will be in the show notes. We have George Papandreou, prime minister of Greece, and Ron Heifetz, senior lecturer and founding director of the Center for Public Leadership at Harvard Kennedy School at Harvard University. We have Cynthia Cherry, president and CEO of the International Leadership Association. Just an incredible group. This was your idea of this conversation. I want to so we can jump into what's to be a i turn it over to you to maybe set the stage fascinating conversation.
Cynthia Cherrey:Thank you, Scott. As you know, this is a continuation of a conversation we had at the Global Leadership Conference a few years back. It is an honor to bring back together former prime minister Papandreou, who we bestowed with the ILA Distinguished Leadership Award, along with Professor Ron Heifetz, who is one of our Lifetime Achievement Award recipients at the ILA. We brought the two of them together to have a conversation. Having these two global thought leaders talking about leadership issues of today and tomorrow was of such great benefit to all leaders and the leadership profession. I am pleased that we are able to get George and Ron back together to continue this conversation.
Scott Allen:Well, George, I was saying before we started that my family had just a magical 10 days in Greece this summer, and it was whether it's the combination of just the incredible cuisine, the environment, the history, the birthplace of democracy. I think that's where we're going to hone in some of our conversation today, Ron, as you think about democracy and as you think about the world and as you think about current affairs and the state of things. That's where we're going to really focus. Our conversation today is democracy.
Ron Heifetz:I think that we sometimes oversimplify democracy as a system of elections, but democracy is really a culture of shared responsibility and a sense of collective engagement with collective problems. Without that sense of citizenship, elections easily become co-opted by either demagogues or simply oligarchic regimes of power that can control the media and other means of public information. The development of citizenship and the development of a shared sense of we're in this together, even though we might deeply disagree on what needs to be done, is an ongoing process and requires a lot of effort. In politics, I think to be engaging and mobilizing the increasing understanding of citizens for the world they're living in and the tradeoffs they need to make and the departures from tradition that sometimes are necessary, and that's an ongoing process. Every politician is limited by his or her latitude in regard to the kinds of policies they can engage in. They're limited by the degree to which the constituents can apprehend or comprehend why that might be needed. Those boundary conditions of constituents' attitudes are constraining unless the politician engages citizens in understanding why it's important to stretch the range of options that the politician then has to work with. I think that George Papandreou has done an extraordinary job of realizing that the hardest problem societies face require a sustained effort in citizen engagement and mobilization and education.
Ron Heifetz:I think the earlier moments in his career as foreign minister in the late 1990s, when he sat together on an island at his first symposium in 1998, the summer of 1998, and just five miles across you could see Turkey from the island of Symi. We were talking about, indeed, the Israeli-Palestinian conflict and the efforts there to make peace. It was during the Oslo period. We looked across the Turkey and I said well, George, how about Turkey? Let's put the Crusades to rest, and what better way to do it than to strengthen relations with Turkey and Turkey with Europe and to bridge the Christian world with the Muslim world? I remember sitting on a balcony overlooking Turkey, and I think one of the cabinet ministers was there as well I think the minister of the Aegean, as I recall and she was horrified at the thought that Greece would ever reach a hand of peace towards Turkey. But George said well, I think that's going to be really important to do. I said to him this will either make your political career or destroy your political career, because at the time, as I recall, about 98% of the population of Greece was sharply antagonistic towards any kind of peace effort or bridge building with Turkey or historical reasons that George can describe better than I can.
Ron Heifetz:George took that risk. It was an extraordinary risk that was manifest not only throughout the population but in the media, which excoriated him when he began to move in this direction, but also even within the cabinet, because there were members of the cabinet, his lateral colleagues, who were sharply antagonistic, not only the minister of the Aegean. That meant that the prime minister had this conflict and what was going to be politic for him to do. George had an extremely risky path he chose and I think it would be terrific to, as an example of how democracy actually worked, not just in the halls of government, but actually in the streets where people live, how George paid attention to that right from the start. If I could ask George, if you could begin to educate us on what you did, it really could be enormously inspiring and illuminating.
George A. Papandreou :Well, thank you. Thank you, Ron. First of all, thank you, Scott, for bringing us together. And Cynthia too. It's another of your work you're doing with the International Leadership Association. Ron has been a not only a good friend, but has been a mentor and truly, truly helpful in many of these crises that I've gone through and different types, different forms and times in my political life, but also a personal friend. I just thank you, ron, for all the help.
George A. Papandreou :I think we're still continuing this conversation and back and forth and trying to see how we can better the world and see how leadership can be truly one that is transformative but also brings certain values which, of course, are encompassed, of course, in our democratic practices and societies, as I believe human rights and more humane societies, more just societies. I don't want to get into the deeper ideas around democracy, but I will at some point, maybe because I think they're important as we are facing today challenges as to where democracy is going. I think going back to you mentioned, scott, being in Greece is useful. Even though I entered Athens as problems they had slaves, women did not vote. We still have some remnants of these problems, and sometimes very deep in our societies. But what I felt with Turkey was that, first of all, crossing boundaries, not only in politics but in life. We often are constrained within our boundaries, whether it's in our family or even the way we think our community, our nation and we think within those terms, and that gives us a certain point of view and the way we approach things. We can move out of these boundaries and open up. Then you can sometimes see many more possibilities of what can be done and imagine a better future, in which I think is basically what democracy has given us the possibility to imagine a better future collectively, what we had with Greece and Turkey. We had a history. We still have the same history as there, but there was a history of animosity, wars, occupations.
George A. Papandreou :When I took over as foreign minister, I was facing a deep crisis because there was a PKK leader that is, the Kurdish leader who had come to Greece, wanted to go to South Africa, was picked up in Kenya and Greece was then seen as the harboring the terrorist who was from the neighboring country. I then was appointed minister to deal with the crisis and we were almost at a war period. I decided that, okay, we need to take the risk to really start talking with each other. I got an ultimatum from my counterpart, but I decided that, rather than reject an ultimatum, sit down and talk, and I sent back a letter which said okay, let's sit down and discuss these issues. Luckily, I found something from the other side which was open to this Ismail Cim, my counterpart.
George A. Papandreou :I think what was important that we started to think of a different context, how a conflict which had its historical roots, with all kinds of victims and explosions and millions of Greeks that had been kicked out of Turkey, and then we had a population exchange about a century ago, but still families remember this. Changing that conflict from a Greek-Turkish conflict into how do we integrate Turkey into a wider family of the European Union? I think that's very important in leadership Can you change the framework within which you see a problem or a conflict? When it didn't become a problem between Greece and Turkey, it became an issue of integrating Turkey into the European Union, a common family. But the common family was also a family of common values. I think one of the basic things of democracy is, even though there may be differences at least that we should have in democracies there are certain basic common values we all share. Now, when that starts breaking apart, then you have polarization and problems in your democracies, but in the European Union we have the idea that, yes, we have common values. One of the basis is the democratic values human rights, respect, dignity of each human being, the sense of social equality, minority rights and so on, and respect of each other's borders and independence. That also meant that the idea was not simply to become a member of the European Union, but it was a transformation of Turkey, where Greece would be helping its neighbor in transforming into a more modern European country, as we had gone through this process too, and we still are. I mean, I think this democracy is a work under construction.
George A. Papandreou :So this was a very different context within which we could say, yes, we do have our problems. We do have the problem on Cyprus, we do have some issues on borders, on basically the continental shelf, difficult issues, but here we have a much wider framework of how we can work together. So that was the first thing. I think, that gave a sense of inspiration that completely changed the whole context of the conflict, I think, secondly, what was really beyond reframing the issue is getting people involved. So that's also a bit of, if you like, what Ron might call bringing the responsibility to the stakeholders, so that the leader is not just simply I have the solution, I am the solution. No, we are together going to look for the solution and solve these problems and discuss them and take the burden of responsibility all upon us. A much more difficult way of leading, but a much more effective in the end and, I think, much more ethical. Also, in the end, much more democratic.
George A. Papandreou :So we had, at some point during this beginning of these dialogue with Turkey, we had this huge earthquake in Turkey. I decided that we have to help Turkey. As a foreign minister, I called on the Greek people. I said let's help them and maybe our traditional enemies, but in the end they're human beings like all of us. Let's show our humanity.
George A. Papandreou :I didn't know what the response would be. I didn't know if there would be a real reaction, as Ron had said, there was a lot of animosity towards Turkey, or that people respond positively. And actually there was such a response. People went out, they got closed, they gave blood. After a few days the hospitals called me, said can you call people off? We can't take any more blood. There's so much such a response. We had our special team going and one of these Greek firemen was able to pull out a young Turkish boy alive, about three years old, from the rubble and the whole Turkish newspaper the next day said "thank you, greece, in Greek. So this changed the whole mood.
George A. Papandreou :But then we started working with my counterpart and I said, okay, how do we build on this mood? How do we create it to really sort of make it where people really feel it? We had an earthquake a month later. The Turks came to help us and then we started having NGOs, so women's groups, basketball teams, football teams, the business community, local government, people-to-people diplomacy basically. So a whole movement of people's diplomacy created a very, very grassroots basis for changing the whole sense of our relationship. So that was, in a way, democratizing these international problems.
George A. Papandreou :We usually think of foreign policy as something where the foreign minister meets with the other foreign minister, the prime minister meets with the other prime minister, they sit down in closed door rooms, decide and then they make the policy.
George A. Papandreou :Actually, I believe that we really need to engage our societies much more and sort of democratize foreign policy in a way where people take on responsibility for this. I don't want to get into the Ukraine-Russia or Gaza war right now, but I mean when I used to go to Israel and I also meet with Ramallah, with the Palestinian leadership, the first group I would meet before I met the officials were the women's group, and they were women from Israel, women from Palestine. They would sit together, they would discuss and they came up with ideas and solutions which were much more profound, much more realistic also and much more hopeful than we would get sometimes from the officials. So society itself if you give it the chance and a sense of being part of this process, they can come up with even many, much more bold ideas. As far as dealing with very, very complicated issues, I can go on, but I think this is enough for the moment.
Ron Heifetz:I just was wondering, George, if you could say something how you worked the messaging with the press I remember there was a moment where you were dancing a Greek dance with Ismail Chem, the Turkish foreign minister, and the way that made the news. And also what was the time period, what was the arc of time that you gave it to engage in this change. That's the second question, and a third is can you say something, to whatever extent you can, about the internal politics in terms of managing your prime minister and maintaining enough support so that you could take these risks, even though this was politically treacherous for your party in government? And then, yeah, that would be terrific if you could speak a bit to those.
Scott Allen:That's three, Ron. We'll stick with the three (Ron) Right. Thanks.
George A. Papandreou :Well, I think, having the support of your superior in this case, who was the prime minister, it is important, even though the risks that they were taken were basically risks I would take, but of course he was my superior so he would also be responsible for my actions. So I did have close cooperation and made sure that I was working close with his team so they could understand what I was thinking of doing. Thanks for everybody taking part in that comment and that was important. And I think if I did not have that support it wasn't always public but I had this sort of green light that would be more difficult. And of course there were rumbles in the government from other ministers what is he doing and why is he doing this? And of course it was very difficult.
George A. Papandreou :But what we decided with Ismail Chem is okay. We have a problem of trust between each other, between these two countries. We cannot sort of delve into the deep, deep, difficult issues which have probably for years have been, you know, pounding us and we have different approaches. Let's see how we can build the trust. So one was, of course, this people diplomacy. But the second was can we start building measures in areas where we actually have common interests, again reframing in a way, but saying we do have these problems, we're not going to hide them. Let's recognize that we disagree, but let's find the areas where we actually do agree. And we actually were in many, many areas where we actually agree.
George A. Papandreou :So for 40 years we had not had one accord with Turkey, one agreement on any issue, except for one which was sort of a military one, not so that people could go and have their tourist islands and not have the jets flying over from both sides. Other than that, there was no accord, no agreement. So we sat down we said, okay, what areas? Tourism, energy, agriculture you know pandemics well, at that time it was more on diseases in the area of agriculture, business, how about investment? How about trade? So we expanded and slowly expanded. And then we got into some more difficult areas, like demining on the borders, which we did. And then, as these grew and we started to sign, these people started saying, well, something's happening here, something is actually moving, an issue on emigration, dealing with the border problem which many countries now have. This was a way to build a trust.
George A. Papandreou :But then, seeing this, we started working together and saying, okay, this will take some time, but what else can we do to show that actually Greece and Turkey worked together, have great potential? So, taking a little bit out of context, if you could see a future Israel and a future Palestine in living in peace together, what if they took initiatives, global initiatives together? Wouldn't that be a really powerful statement? So we actually started thinking what do we do? How can we take initiatives? So one was, for example, we had the Olympic Games coming up in Athens. They said, okay, why don't we revive the idea of the Olympic truce, which is the basic idea of the Olympics, to bring peace for a period of time during the Olympics at least, where people did not? So we had a statement which I am and my counterpart, my Turkish counterpart, ismail Shim, wrote up and first signed. And we went around the world getting all kinds of leaders to sign it. So we had Bill Clinton sign it, we had the Chinese Foreign Minister sign it, we had Simon Perez sign it, we had Yasser Arafat sign it, we had Nasser Mandela sign it, we had the Iranian Foreign Minister sign it. We had a slew of people signing it. This is one thing to show that they're working together, we can actually have quite a quite an impact.
George A. Papandreou :Then there was a war in the Balkans, close of a war. There was a lot on CNN and BBC saying Greece and Turkey were one of the reasons we had to intervene, because Greece and Turkey would fight over close of war. So I actually called up my counterpart and said are we going to fight over Kofi? He said no. I said let's show that we can work together for peace in the region. So we actually started working together on humanitarian aid and so on. We then at some point went together to visit Ariel Sharon and Yasser Arafat during a very critical period. Ariel Sharon had just decided to hand over Gaza and leave Gaza where the Israeli troops would leave, and it was quite a whole difficult tense time. So all this was a way to build up trust and then to finally sit down and say, okay, now let's start working on the more difficult issues. How are we going to solve Cyprus? How are we going to solve the continental shock? We finally didn't.
George A. Papandreou :I think one of the reasons was that governments changed. I left government, other governments came in Greece and Cyprus and Turkey, and I think that also changes. Often you have a historical moment, a historical window. You don't always get what you have, but what it did show is that actually there is great potential to move forward Now inside Greece. We started with, as Ron said, 90% being very skeptical about any kind of contact with Turkey and by the time I had basically ended my time as foreign minister before the elections, 70% of the Greek population were in favor of the policy, so the policy really switched from completely to negative to highly positive from that point of view.
George A. Papandreou :So these are some of the things I think that we were able to do and, as I said, being informing people, getting people involved, understanding the issues. Being honest, usually there was a sort of a fear of secret diplomacy. So what we would do with Ismail Chim? We would sit in a hallway in a hotel and across the hallway we would have all the journalists so they could actually see us. They didn't hear what we were saying, but they could actually see us sitting there, talking for an hour, for two hours and so on, and so we tried to be as transparent as possible without creating a sense that some secret thing is happening, some conspiracy, something is being done behind the backs of our citizens, and I think that also helped a lot in creating a much more of a sense of trust that there's something really going on here, something positive going on here.
Scott Allen:I'm hearing things like a wider framework, the possibility to imagine a different context, building trust and focusing on those commonalities. Ron, what are you hearing or how would you like to follow up?
Ron Heifetz:There's so much more to learn from you, George, about that piece of history than also if we just fast forward a few years when you became prime minister, right in the middle of the global financial crisis.
Ron Heifetz:But perhaps there's just one last question I have about the era of your diplomacy, which is one of the huge changes that you made from policy point of view, is that, rather than be the blocker or the veto of Turkish candidacy to the European Union, you reversed 180 degrees and became a champion of Turkey's admission into the European Union, and having done so, it seems that the hidden negative voices then were exposed, because they couldn't hide behind Greece's intransigent attitude before. Can you say something, then, about that effort, and how did it go south? What happened to it that, within the time period you had to work with it, it became stalled in a sense? Or another way of putting it is what were the attitudinal or adaptive challenges to the minds and hearts of people in Europe that would be required in order to accept Turkey as a member of its union, the European Union then?
George A. Papandreou :was going through a major change. We had the fall of the Berlin Wall but with that the opening up to Central and Eastern Europe and therefore the prospect of bringing in 10 new countries, so it would be the Central Eastern Europe plus Malta and Cyprus. This was a great hope and there was a great sense that democracy was coming to the world. It wasn't exactly the end of history, but it was certainly a huge moment, a huge change, and a positive one, and this positive spirit was something which we could build on. And Greece was there saying no, we're going to veto Turkey because we have problems with Cyprus, because they've occupied Cyprus, because they're not solving the continental shelf, they're talking about our islands as not being Greek and so on. So we said we have to keep a veto on them. So what we decided to do at some point we said, okay, let's not veto them, let's bring them in into a process which that process will actually lead up to them becoming a member of the European Union. But that really meant huge changes. It's basically it's not like you just sort of apply for membership, you become part of the members of the club, but there's certain prerequisites very important, and part of them are democracy. Part of them are, you know, military doesn't have a role in politics the respect of human rights, respect of your neighbor and the territorial integrity of each country, and solving peacefully your issues with your neighbors. So actually, what we said is this is a context within which changing this framework, the whole idea. This is a context within which actually, we might be able to solve our problems.
George A. Papandreou :The European prospect and we came very close to it. I think what happened was, as I said, the government's changed, so then that momentum was lost. But then what happened was in Europe we had the expansion and there was a bit of a fatigue of we becoming very big, much more cumbersome in decision making. Then we had a number of crises which then came up later financial crisis in 2008, but that dragged on. So people started feeling the burden of okay, how are we going to bring in another country, which means money that will have to be going to agricultural policy or whatever policies the European Union does subsidize. But that also came in.
George A. Papandreou :What came in was this idea well, what about the Muslim world? Because Turkey is a Muslim country, which previously was discussed, but everybody had the majority in Europe were saying listen, democracy is not something related to one religion or one specific religion. Democracy could be, and is, a universal concept. So actually bringing in Turkey would be a real proof that democracy is not linked to, let's say, the Christian world or whatever other world one might have, and basically separating the religious issue, because what we actually see is we see religious extremism in all religions which can undermine democracy. So it really has no. The idea that one religion or another is counter to democracy, I think is a fallacy, but I think it also is what you said, ron putting to rest the Crusades, which was in many ways would bringing in, but it would be.
George A. Papandreou :I think Turkey wanted to play this role also. And then you had the conservative leaders in the European Union starting to say we don't want Turkey, we don't want a Muslim world, the Muslim world in our countries we don't, and this, of course, then was built up. A lot of demagogues played on this. We then had the refugee crisis, where more people started playing on this because they were from Syria, from Afghanistan, from Iraq. That all sort of played in with the financial problems and the my refugee problems. All played into this demagogic rhetoric which we are dealing with now in Europe. And it's a very major problem because it is undermining our sense of first community as a European community, but also our democratic principles as people are.
George A. Papandreou :These demagogues are saying, yeah, well, we need is being tough, being authoritarian.
George A. Papandreou :They don't say it that way, but that's what basically they mean cracking down, bringing more surveillance.
George A. Papandreou :We don't need really rule of law, we need strong police, we need a strong leader these kinds of things which, of course, have created more problems, and that has.
George A. Papandreou :Then, at the same time you have this in Turkey too you have Erdogan, who became a sort of a reformer and now has become a much more autocratic, centralized sort of power and has therefore moved away from these democratic principles. So he has Turkey has a huge, long way to go to make these, to go back to where it was, but also to make new reforms. Now there is in Turkey a large number of people I would say almost half the population is not more who do want to become part of Europe, do want this European path, and again, there's a large group in the European Union citizens who do see Turkey at some point to be either a member or very close to the European Union, and now that we've had a new possibility of new members like Ukraine, moldova and Georgia and, of course, the western Balkans Turkey, of course, is. Then it comes up as another question. I have been a supporter, but it does mean both sides to rethink this relationship and give it no impetus.
Ron Heifetz:Perhaps we could move forward. It's so rich hearing you speak, and inspiring too, because of the values that you bring, along with a lot of practical wisdom. Tell us a little bit about the challenge to democracy that you experienced during the global financial crisis, when people were in a panic In a way, as I remember it from looking over your shoulder during those years, you came into power. I think it was in November of 2009. The global financial crisis was already underway and you came into government and, in a way, discovered that the previous government had been deceiving Europe in regard to its budget and its level of debt, and certainly the public was not prepared to understand that the government was running a much larger deficit or carried much larger debt than it was supposed to be carrying, and some of the services that were being purchased were unsustainable given the revenue streams of the government.
Ron Heifetz:So you came into power, as I recall, and you had this fabulous finance minister, a wonderful man, Giorgos Papakonstantínou, as I recall, and both of you really committed to transparency and enormously honest, and I recall him coming into the ministry of finance and then people reporting on what's the status of our budget. Let's take a look at the books and as people began to have a little more courage and he would call people well, tell me more, wait a second, what's that really about? People began to reveal that well, the budget deficit. I can't recall exactly the ratios, but anyway, it was supposed to be less than 3%. No, it's really 5%. No. The next day no, it's really 6%, no. And over a two week period, slowly discovering that it was more like 12, or, of course, you recall the numbers and I don't, but the point is that it was that-.
George A. Papandreou :It became 15.6%. Yes.
Ron Heifetz:Okay so now you believe in transparency, you believe in publics, knowing what's happening and having a trustworthy relationship with everybody, knowing that your predecessor in the previous government, which was not from your party, had been deceiving the lenders and the lending countries for many, many years. What did you do so you get this information that, in a sense, that I started my career as a doctor. You get this information that the patients got a tough problem and the patient doesn't really want you to walk into the room and say that people want to hear that they're okay. But they weren't okay. They wanted to hear it. Certainly the Deutsche Bank and the governments, the lending banks in Europe, didn't want to hear it. The public didn't want to hear it. But here you were. So tell us how you wrestled with that moment as a democratic leader.
George A. Papandreou :I think it's emblematic of the types of crises our leaders face today, which can start at home or can be start somewhere else, but they have a global impact. So the financial crisis started in Wall Street. There was great mistrust because of that financial crisis in the financial system. That mistrust at some point started infecting, if you like, sort of like a pandemic, the country's own debt structure. Actually, the first country that was hit by financial markets were in for a possible default or having a bankruptcy was Dubai, and the Emirates then bailed them out immediately and that was quiet. So a few weeks later they started targeting Greece because of this budgetary discrepancy, and it was huge. And it wasn't just the numbers, it was a sense then it was created was a sense of mistrust. So we had a huge deficit, we had a trade deficit also, but I think the worst deficit was the deficit of trust, and so I basically had to deal with the deficit of trust both within the European Union and globally. And, of course, then there was a sort of a shock in the Greek society and, as you said, in that view, you have written and spoken about in many of your lectures the dealing with the reality of whether it's an ailment or a crisis and so on. People often look for easy solutions which are less painful, or they seem to be less painful because they're easy solutions. So I had to reveal what was happening, partly because I could not have hidden it anyway, partly because I revealing was giving me an opportunity to actually make changes in Greece. And thirdly, had I not done on show, I would not been able to build trust because sooner or later they would have found out that I was trying to hide the numbers. But it was a shock to all of us. But then what I basically said is okay, this is a crisis, let us use it in the best of ways. And here, of course, obviously leaders have to understand what the nature of the crisis is. And I think this is another issue and there sometimes don't want to understand the nature of the crisis because it can mean very, very big changes that are needed to be done.
George A. Papandreou :So I was basically saying, even before I took on government, that either we that was our slogan either we change or we sink. So we were sinking there and I was saying that, okay, this is not really that we over spent, but there was a whole system of very clientelistic politics, quite a bit of corruption, mismanagement, which where we lost a lot of money. Money was so money would be coming in, we could borrow as being part of the euro, but it was spent in a very bad way, from corruption to simply bad management. So I was saying, okay, this is the core problem is to build a different type of governance which more transparency, fight corruption and not let these oligarchs capture our politics and so on, and really make government work for the people. That is basically what I also believe is very much what democracy needs and I think we have this as a major problem.
George A. Papandreou :Greece may be one, but in other many countries around the world, there is a sense that government is captured by interests, whether it's lobbies, whether it's big companies, whether it's digital platforms, whether it's oligarchs, whatever. There is a sense that government, media, social media, justice sometimes crony capitalism. We have government captured. That sense is what I was fighting. That was what I had to deal with changing that. So I brought in things like complete transparency and, where money went, electronic prescriptions in medical, in the medical. So we cut prices of medicine by half, by 50%, which were burdening our social security system. That was as much as we make in property taxes in all of Greece, the cuts we made, and that was simply by bringing in transparency. So we were fighting for this. Now I had to also, so I was dealing with that. A lot of people in Greece were seeing this as positive, but then also there were some painful things I had to do which were hurting people, because we didn't have enough money to actually pay salaries, so we had to cut salaries and that was very painful. And pensions.
George A. Papandreou :Now the European Union. Of course, we were in this family. We have this common currency. So, all of a sudden, the European Union is dealing with one country that's almost ready for bankruptcy and they have no bailout clause. They have no. As a matter of fact, there is a clause which is where the European Union is not allowed to bail out any country, not allowed to help any country. You just have to stick to the rule of 3% and if it doesn't go well, well, that's your problem.
George A. Papandreou :However, this was shaking the whole system. However, the reaction of the leaders most of the leaders in the European Union was okay, this is a Greek problem, this is not our problem. So that was an easy scapegoat way and, as a matter of fact, I think this led also to a buildup of the sort of xenophobia that we have today in Europe, because it was sort of like the Greeks are lazy, the Greeks don't work, the Greeks are just, you know just Zorba and Uzo and things like that. I looked at the OECD statistics Greeks work more hours than any other European, but the rhetoric that was the narrative was there, was very easy for many leaders. This is a Greek problem and that also meant that Europe didn't have to deal with the issue. They didn't have to think of their own architecture. We didn't have to, as Europeans, think of our architecture of the euro, which is a common currency with very different economies, with very different bank systems and so on.
George A. Papandreou :Finally, we pushed through changes and I pushed through changes and changes were made, but they took a long time and during that time there were lots of crises and there was much pressure for us just to cut, cut, cut, when I was saying it's not the wages, it's partly the wages, but it's the deeper problems of the structures, the institutions, which would end the change. So I had two things to do I was had to cut because that was what they were demanding if they were going to lend me because I couldn't borrow from the markets because they were just too expensive. At the same time, I had to make all these institutional changes. The two combined were very painful for Greece and very painful for our citizens. And that's where we started getting what you said, ron again the reactions we don't like the messenger, we don't like the message, we don't like the messenger. And also what I felt was that it was very easy to look for another doctor. As you would say, ron, you go to the doctor. Not so good news. Maybe I go to another doctor, maybe I get a different diagnosis and I don't have to deal with the real issue there.
George A. Papandreou :So social media started playing on this and I think one thing I learned from that is that I mean, now we know it, but I had been very involved with using technology for politics and informing people and so on. But the power of social media and the power of fake news was something I hadn't really dealt with. That how quickly it spreads, and how quickly it spreads around the world, not just in Greece. There would be any rumor or default and it would go around the world and the spreads of Greek bonds would go up. But inside our society.
George A. Papandreou :There were people that would say you know, we can get help if the Saudi Arabians come or the Russians come, they buy up our debt, or the Chinese come and buy up our debt, we don't have to do all this painful stuff. And I thought of course, nobody believes that, but actually a lot of people did so. The idea that so you are dealing with a multiple number of stakeholders and you see how people sort of, can easily be carried away. How do you deal with that as a leader? And I think what I should have done more, but I was dealing with the crisis is one of the problems. You have to talk to everyone, everywhere in Europe, around the world. In the US I went to meet Obama, you know, chinese prime minister, anybody who had funds anywhere around the world.
George A. Papandreou :So, yeah, I was preoccupied time-wise in dealing with the daily crisis.
George A. Papandreou :I think I needed to spend more time sitting down with citizens talking on television, on social media, not just in the parliament, in the villages, in the neighborhoods, getting people to understand what this crisis was all about and where it will go.
George A. Papandreou :However, things were not even even then would not have been completely in my hands, because we had a destroyer which was telling you what to do. So here I am fighting for democracy, fighting for actually citizen participation. I even created what we call Wiki laws, where no legislation would be going through parliament without having a wide deliberation through the internet. But then, of course, when we had a troika on our shoulder or on our head, we really didn't have much space for all this democratic deliberation. I think this is one of the problems we have in our crisis today. They can be so fast, so hard, hitting, so immediate where our democratic processes, we don't allow for the space for our democratic processes to really converse, discuss and so on, and then the crisis hits and then you just have to take some measures. So I think this is one of the dilemmas we have.
Ron Heifetz:I mean, as I recall, George, initially your popularity was like 80%, very, very high. You had a large majority in the parliament, which was unusual. You didn't have a coalition government, your party was in control. But after a year and a half of this pain, obviously politicians who used to go into the local taverna or the market expecting to be applauded, or people would be greeting them with respect, shaking their hands, taking photographs. A year and a half later, as the crisis began to be more and more painful, your own party politicians would be. Sometimes they would avoid going into the taverna because people would get angry. They would yell. Sometimes there were even threats. They were endangered and that began to pull apart the sort of the unity of your party.
Ron Heifetz:So one of the, as I recall, one of the devices you wanted to use was a referendum. Do we want to stay in the European Union and to try to get the public engaged in this very difficult trade-off? Do we want to stay in the European Union and continue to be Europeans, continue to use the euro as our currency? But that's going to require that we accept some of this painful medicine that's being dished out by what you're calling the Troika's, but primarily the various sources of European power and financial resource and to use the referendum as a public engagement, public choice-making, public responsibility-taking measure. And, as I seem to recall correct me if I'm wrong the Europeans, the key Europeans, the French president and others were very strongly resistant to the idea that you were going to give the public, the democracy, a chance to work, for fear that the public would go the wrong way. So can you just say a little bit about that, how you felt like your hands were tied from even trying to get democracy to work more properly, at least in that last stage of your medicine?
George A. Papandreou :Absolutely. Yeah, that's a very important point and, having talked with others with experience, I had realized that you have to take difficult measures at the very beginning, which I did. But then there was a long period of dalling from the European Union and I think one of the reasons was that there was a sense that Greece has to be punished. It's not just let's solve it, but because we can solve it quickly. I asked my friend I remember talking to Volker, former head of the Fed in the US and he said you know, in the US we would solve the problem in two or three days and then talk about the moral hazards or whatever of solving it later on, but we would solve it, we would deal with it. And there were ways to deal with it, like quickly tell the markets listen, and it did happen, finally in 2012. I was out of office by then, coming in and saying you know the markets, hey, you know Greece is safe or Italy is safe or Spain is safe, we're going to guarantee that. So it could have been done, but they didn't want to do that because this was sort of like the moral hazard okay, they've been bad, we have to punish them. And the punishment was painful. So while in the beginning actually even for the first year, maybe in an a half we were very popular, we won the local elections a year later resoundingly.
George A. Papandreou :But then, when the European Union was coming back and saying you need to do more and you need more and more, then I saw that there was there was there's so much pain in this situation. That's a good luck. I actually decided. I said I called my former classmate and head of the opposition, Antonis Samaras, who were together in Amherst College. I said, andoni, let's make a coalition government, let's make this wider, let's work together, let's create a sense of a wider consensus rather than fighting about it. Actually, your party was also responsible for this mess. This is a way to redeem yourself. He didn't want to do that because that he would most likely felt that we would lose out. So when I reached the point when we had demonstrations we had almost violence, there were all kinds of rumors that ex-military people were organizing and so on I said, okay, let's go to a referendum and let the people decide. And luckily I had a strong negative reaction from a number of leaders in the European Union not much support that undermined my position.
George A. Papandreou :That was actually used by the Brexiteers later on. That example and by Neil Farage as an example of look at Europe is not democratic. Why should we be in Europe? We want to take control back in the UK and look what they did to Greece. So, yeah, I think it was not a very wise move from the leaders in Europe. Obviously, it didn't help Greece. I think if we did have the referendum, we would have some form of resolution. I actually think we would have won it, but some form of resolution one way or another, and it would have been a democratic decision. We would have taken responsibility of our decisions. Obviously, referenda are not always the way to solve problems and sometimes, when you ask people things that they don't really know about. But this was an issue which people understood, it was vital, it was a daily issue. They know that you have the euro, you don't. We do the program, we don't do the program. So it was quite clear what the dilemma was.
Scott Allen:This is a first for the Phronesis podcast, a two-part series. Ha, you weren't expecting that. I know pretty wild, but just an incredible conversation with a world leader about some of the challenges that he's facing. And of course, we have a world-class scholar on with us as well. How is Dr Ron Heifetz going to make sense of some of what he's hearing? That's what we will explore next week in part two of this conversation.
Scott Allen:But you know there were some really really wonderful, beautiful phrases in the language that was used A wider framework, the possibility to imagine a different context. For me, the practical wisdom is how do we create a wider framework, how do we provide others with a possibility to imagine and how do we facilitate a different context? Now, those who listen weekly know that in recent episodes I've been exploring context and here is a world leader facing a very challenging context. Check in next week for part two of our conversation with Cyn Cherry, Dr. Ron Heifetz and George Papandreou. Next week, I think Cyn is actually going to debrief with me, so that'll be kind of fun to hear her reflections on both of the conversations. But, as always, thank you so much for checking in. Really appreciate you being here. Take care everyone. Be well Bye.