South Street Souvlaki owner Tom Vasiliades thinks he knows what will happen in his native Greece.
He expects the currency crisis rocking his homeland will be hard in the larger cities like Athens. After five years of recession, the Greek economy hit a nadir at the end of June, when it became the first developed country to default on an IMF loan designed to keep banks solvent. Instead, they closed on June 29, and are expected to stay shuttered through mid-July. Greek businesses can’t execute financial transactions, and citizens are stuck with a daily ATM withdrawal limit of 60€ (around $66) per person.
But “Greeks are survivors,” notes Vasiliades, “they’re going to manage somehow.”
While that will hurt in the cities, Vasiliades says people living in the rest of the country will turn to self-sustenance — growing their own vegetables and keeping farm animals — and use barter instead of cash. It’s how many survived when he was growing up there in the 1950s, when Greece was recovering after ousting a devastating Nazi occupation during World War II. “This is the second time Greece has said ‘Oxi’ [No] to the Germans!”
“The only really bad thing is this happened during the tourism season,” he added. Tourism accounts for 18% of the Greece’s total GDP, and employs around a fifth of the workforce — more than 900,000 people.
Those worries notwithstanding, Vasiliades reports that Athens is still hopping. His daughter just returned from a two-week stay there, and found all the restaurants packed on a regular basis. The IMF default was decided by referendum put up to popular vote, and many Greek citizens celebrated what they saw as a chance to return to financial independence.
Greece’s economy has suffered every since the country joined the eurozone and swapped out its native drachmas — over which it maintained full control — for euros, the world’s second largest reserve currency (after the US dollar).
“You used to be able to buy a sandwich for 500 drachmas, which was around $2.25. [After adopting the euro], all of a sudden a sandwich was €6 ($6.65) — triple the price,” said Teddy Sourias, owner of Midtown Village bars U-Bahn, Bru Craft & Wurst and Finn McCool’s. “It’s not like anyone who lived there was getting paid more to afford the increase.”
Sourias doesn’t think switching to the euro was a good idea in the first place. His aunt owns a piece of property in Athens for which she hasn’t been able to collect rent for three years. It’s not worth trying to evict the residents, however, since it’s doubtful she’ll be able to replace them, and they’re at least paying electric bills and keeping the power on in the building.
George Tsouris, who owns Greek taverna Opa in Midtown Village with his sister Vasiliki, saw some benefits to adopting the euro.
“At first it was a difficult adjustment for Greeks, but it brought economic opportunities with a single currency and visa-free travel within the European Union,” he wrote via text.
Vasiliades, on the other hand, hopes for a return to the drachma, which would allow Greece to begin printing more currency, something the government cannot do with the euro. “It’s just like we do here in the U.S. — when we need more money, we print it.”
He also has another suggestion for helping his homeland return to solvency: Crowdfunding. “There are so many Greek businesspeople spread out through the world — if everyone kicked in some money, the government could pay off the debt.”
It’s not a lone sentiment, but neither is it one that’s likely to work. An Indiegogo campaign to raise the needed €1.6 billion stalled with just under €2 million donated.
Bru’s Sourias is not altering his longstanding plans to visit Greece next week, but is planning to bring cash along, even though it’s not his preferred travel practice. Even extra cash may not be enough, though, because shop owners have begun to ration supplies. He recounted the experience of another aunt there who went to the store to buy three cartons of milk…but was told she could only purchase one.
“For the next few years, if you live there, it’s going to hurt,” he said, “but I think in the long term it will even out.”