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Financial Crisis, Markets and Democracy, Climate Justice: SI Council in Costa Rica

23-24 January 2012

Speech by George Papandreou, President of PASOK and President of the Socialist International

at the Council meeting of the Socialist International, San José, 23 January 2012

It is a great pleasure for me to be here with you today, in San Jose, Costa Rica. It is a special honor for the Socialist International to have with us her Excellency the President of Costa Rica Ms. Laura Chinchilla. As Costa Rica's first woman President she is a symbol of women empowerment in Central America and beyond. We are looking forward to her remarks. 
Let me take this opportunity to thank our hosts the National Liberation Party (Partido Liberacion Nacional) and its President Bernal Jimenez Monge for the warm hospitality.  Bernal, I wish also to warmly congratulate you on the 60th Anniversary of the founding of your party.  Since its creation in 1951, the PLN has been a force of progress and prosperity for Costa Rica and its people. It has contributed to make Costa Rica an example concerning environmental policies and protection of the natural wealth.

Costa Rica, under the governance of the PLN has made dramatic progress and it has become a model for peace and prosperity. It is not accidental therefore, that many have characterized Costa Rica as "the Switzerland of Central America". Historically, social democracy in Costa Rica is associated with the establishment of political, democratic institutions, including putting the military under civilian control. It is also associated with the efforts in uniting Central America around a peace plan, an effort that was universally recognized when former President Oscar Arias was awarded the Nobel Peace Prize in 1987. Despite the global economic and financial crisis, Costa Rica remains a robust economy and strong democracy.

Dear friends, dear comrades,

I often hear a question, even a complaint: Is our movement relevant to today's problems? Here in Central and Latin America you know very well we are relevant. It is not only the fact that we have become a strong political force for change and progress but we have shown that progressive governance does matter.

This region has experienced - as we in Greece are experiencing - deep economic crises. The rule of the IMF, the mistrust of the financial system, the austerity of the measures. Yet you know. You know more than anyone else that both Latin and Central America are rich areas. Rich with resources, rich with human capital. But these resources have often been mismanaged, squandered, usurped by the few and powerful, by dependencies and interventions.

That is why these crises are not primarily financial but they are political. They are crises because of the lack of democratic governance, because of the inequalities, because of the lack of opportunities, the lack of transparency, corruption, the clientilist and authoritarian regimes. Regimes under which our citizens were marginalized or even oppressed.

Our movement in Latin America and many other parts of the world has been in the forefront of change. Democratic change. Breaking away from dependencies and clientelism.

And our experience in Greece is similar. It was a conservative government that mismanaged our economy. It ballooned our public debt but left the country uncompetitive, non-transparent, with a huge deficit, both financially but also in our credibility. It created all the preconditions that forced us to seek refuge and borrow from our fellow member states in Europe and the IMF.

And since then we have been in a race to change Greece. Yes, our socialist party has been in a race to change Greece. To make Greece transparent. Putting everything online. Fighting clientelism. Hitting back at established oligarchies of power.

But at the same time we had to take draconian measures to save our country from bankruptcy. And we have done so.

But I would like to thank our friends, our comrades here in Central and Latin America, in all of the SI, for your continued solidarity. It has been invaluable for me personally and for the Greek people who are going through difficult sacrifices. So thank you for the solidarity.

I know you understand more than many what our plight is. With our common strength and our belief in our people I know we can win this battle and we will. We will make this crisis an opportunity for a new Greece.

But if we in Greece were a victim of what I call clientelistic capitalism, where the state and the markets were used to serve the rich and powerful, Europe today is a victim of a narrow-sighted response to the crisis. Conservative Europe has failed, despite much being done. In fact, we socialists, we social democrats understand the market much better than the conservatives.

Markets need to be regulated. We are not against markets. But they are no gods to us. They need to be put to work for the common good, for our peoples, for our citizens. Otherwise the market becomes a tyrant, or is dominated by swings of speculation.

That is what we experienced these crises for years, from 2008 and on. That is why many countries and soon the whole of the Euro zone is experiencing these crises, and a conservative Europe has failed, has failed to protect us.

Our movement, the SI, and I myself, both as head of PASOK and as Prime Minister of Greece, have taken a strong stand as to what must be done.

And as Francois Hollande has said, the candidate now for the presidency of France - he said he has one enemy. It is an enemy with no face, no name. It uses unconventional means; it is unelected but all-powerful, creating new inequalities and injustices. It is the power of the markets over our democracies. It is the power of the concentration of wealth, media, resources, in a new global system over the power of our citizens.

So ours is a struggle for democracy. Ours is a struggle to reoccupy democracy in our societies and in the global economy. Ours is a struggle to empower our citizens. Ours is a struggle to guarantee access to knowledge, to participation, to jobs, to opportunities for our citizens.

And we have made proposals. We are fighting for democratic oversight. We have been in the forefront fighting for:

-   Greater transparency in the financial system.

-    Democratic oversight and transparency concerning the Credit Default Swaps and speculation.

-    Democratic oversight of the rating agencies that today have more power than our parliaments.

-    Democratic and transparent control of tax havens that in fact rob our citizens of their resources.

And our Commission on the Financial Crisis headed by Joe Stiglitz has made important recommendations that today have even greater relevancy to democratic global governance.

Secondly, we have been fighting for a comprehensive program for sustainable growth around the globe, because we see that austerity is killing Europe. And with it we are bringing down the world economy.

That is why the Socialist International was once more actively present at the COP 17 meeting that took place in Durban, South Africa last December. Because we faced a great risk in Durban, that there would be no alternative to Kyoto. But due to the skills of the South African government, we enabled to keep climate change on the agenda, even though we are not moving here as fast as necessary. And the first victims will be the small island states.

But our movement through our Commission on Global Sustainable Growth, headed by Ricardo Lagos and Göran Persson, has made concrete proposals. We say we can stimulate our economies, deal with the threat of global recession, and do so in a sustainable way. We have proposals for finding the new sources of revenue for such a growth strategy. Revenue to be invested in jobs, for a green economy, for combating climate change, eradicating poverty. For an alternative growth strategy for the world, and of course for Europe which is going through a deep recession.

We have proposed to this effect the idea of a financial transaction tax or a Tobin tax, as it's otherwise understood.

Bankers, yes, must contribute to the solution of this crisis, as they contributed to the creation of this crisis. This is not only fair but would produce important resources.

As also a proposal for a CO2 or a greenhouse gas tax.

And these revenues should be used to invest, to make the world more sustainable, more just and more equitable.

Whatever the challenge, our proposals, our initiatives are based on deep held beliefs and common values we share in this family. We are a movement that bridges divides, creates cohesion as our values inspire us to struggle for democratic participation, liberation of the potential and empowerment of our peoples.

Our fight for justice, equality and transparency is a fight that bridges the divide, redistributes wealth and power between the powerful, the rich and the poor or marginalized in our societies.

And we bridge the divide between growth and sustainability, ourselves and our natural surroundings, by supporting green, sustainable growth, which creates jobs, preserves the richness of our cultures and the beauty of our environment.

Our political family has a tradition of multilateral approaches and consensus building.  

We contributed to the vision both of the European Union but also helping the United Nations and tackling major conflicts, whether it is from the dialogue between the different sides in the Palestinian conflict, or fighting against the proliferation of weapons of mass destruction.

Dear friends, dear comrades, yes, we are different! Different from the conservative forces of the world. Because we believe in the potential of every person. Because we know that even the weak, the outcasts, have great potential which our markets ignore or waste. We also know we can change, and that's why we believe our society needs all and everyone.

That is why we believe in equality. That is why we believe in woman's potential, as equal partners in our families and in our societies. That is why we fight against racism and xenophobia. That is why we are in the forefront for human rights, for minority rights, for free speech, from Myanmar to the great lake regions in Africa. That is why we are fighting for democracy, equality, justice, sustainable growth around the world.

We - more than any other political force - understand the need for greater democratic governance around this globe. And we also know that we have the capacities to make poverty history, to change the world.

But we must go beyond easy nationalism, fundamentalisms and fear-mongering, and not be captive to special interests, corruption and powerful lobbies. Our globalized world has brought us new challenges. We, as a movement, are ready to deal with them, without dogmatisms, without fear, without preconceptions.

We do not believe in the politics of fear that keep our citizens insecure, in search of saviors. We believe in the politics of values, respect and empowerment of our citizens. And we need to open up new debates in our family.

How do create greater tolerance and understanding in a world of migration, multiculturalism and diversity?

How do we deal with the narco traffic effectively but also - as many have suggested in this region, such as Nobel Prizewinner Carlos Fuentes - do not penalize the consumer of drugs?

How do we use the Internet to empower us, to empower our citizens? Can we make knowledge the common capital, the common wealth of humanity? Because what is our major resource, our basic resource? Is it our energy resources? Is it our natural resources? Is it our weapons?

In the end, we believe - and I think this is deeply socialist - that our resource, our resource is knowledge, is knowledge for everyone, and how we use our knowledge. So how do we make sure that this resource has access for all our citizens? And how do we make sure that we can benefit the world? This is at the core of a question of our democratic culture.

And we have examples of what we can do:

Costa Rica has shown that we can grow and respect our environment. In fact, this has become a growth advantage for Costa Rica.

The Nordic countries with their social democratic tradition have shown we can be competitive and also democratic, create societies of equality, social cohesion and investment in innovation, education and human potential.

Whether we are looking at Athens of the ancient times or whether we are looking at Athens of today, democracy is our challenge, where our powers and resources are used to the benefit of our peoples.

And we have new challenges.

A large part of our citizens, particularly the youth, whether it's from the Arab Spring to the Wall Street protests around the globe, feel alienated from the political processes. We should reach to them. This is our task: to convince them that politics - yes - can still change the world.  This is our democratic challenge.

If we do not succeed to counter this global inequality and this alienation of politics, we will see growing populist and far-right movements. We will see the lack of trust in democratic institutions and the increase of civil disobedience or even violence, as a means for politics. And this must change. This must be avoided.

And we can succeed and we will succeed.

We are moving forward in changing our movement, in changing our parties, in changing our practices, to live up to these new challenges of our times.

I'd like to end to say that to increase our further reach we continue our reform process.  I wish to congratulate the three co-chairs of the Working Group on Reform, Eero Heinaluoma, Nhouza Chekrouni and Beatriz Paredes, as well as those who have participated in this effort.

During the two meetings of the Group in Geneva and Marrakesh, an open and sometimes heated debate took place. It's expectable on an issue that is so important for our organization that there are different views and perspectives. The paper prepared by the co-chairs helps us to identify the main issues where there are very concrete dilemmas.

I will mention one that I think is crucial for me and it concerns the elections of the leadership of the organization. Because we need to be not only a force of inspiration and hope for progressive citizens around the world but also an example of democratic functioning, I think we should elect the President and the Secretary General in open elections in the Congress.

And this should become effective from our coming Congress in South Africa.

Again, friends, we are here to show that our movement is strong, is creative, and is dynamic. And I am very happy that, although it may be a long distance from Greece to Costa Rica, we feel today with our comrades here in San Jose a very warm atmosphere of a strong shared culture, solidarity and their hospitality.

Thank you very much