ATHENS, Greece — Greece has won strong endorsements in the past year for shoring up its economic statistics after years of fudging data to conceal its deficits and financial mismanagement, but the man who's responsible for restoring the country's reputation is now the target of possible prosecution.
He's been accused of exaggerating Greece's deficits in a conspiracy to strengthen the hand of the European Union and the International Monetary Fund.
Even as the country navigates its way back from the brink of economic catastrophe, the same crazy political infighting that brought matters to a head here — and provoked a broader crisis for the euro — continues to dent Greece's international image.
"To me, it is suicidal," said Andreas Georgiou, the target of the conspiracy case and president of the newly established independent Hellenic Statistical Authority, known as ELSTAT. "We are in a process of perpetual hara-kiri. And it is not necessary."
The case is flimsy at best, but in theory the country's chief statistician could land in prison for life for issuing data that his detractors say led to higher bond prices and a drop in housing values.
Another Greek economist, Zoe Georganta, has accused Georgiou's institute of artificially inflating the estimate of the 2009 Greek deficit, to 15.4 percent of the gross domestic product from 13.6 percent. European statistical officials have endorsed Georgiou's estimate, but after Georganta's charge, the state prosecutor for economic crimes launched an investigation Sept. 19 into a possible "breach of faith" against the state.
A Greek government official called the case "outrageous." Visiting European Union officials are said to be "speechless" over the dispute. But to an outside observer, the most disconcerting aspect of the case is that Georgiou couldn't name a top political figure who's publicly thrown his support behind him.
Greece may have given birth to the concept of modern democracy, but anyone who hoped that the country's crisis would transform its dysfunctional political culture has only to look at the Georgiou affair to see how little has changed. A technocrat who the EU's oversight body says has restored credibility and honesty to the reporting of Greece's economic statistics is the object of attack by a significant part of the political establishment, ostensibly for telling the truth.
The fate of Georgiou and ELSTAT has become a political football between Greece's leading parties. The center-right New Democracy party — in power from 2004 to 2009, a time when the EU often rejected Greek official data as flawed — seized on Georganta's criticism to attack the center-left party, the Panhellenic Socialist Movement, known as PASOK, which was in power when Georgiou issued his revised estimate in November 2010.
Both parties now are part of an unhappy coalition government that's negotiating a bailout for Greece with the EU, the IMF and private creditors.
The Finance Ministry, in what apparently was a defense of Georgiou's stewardship, said in a statement that New Democracy had miscalculated growth and the national deficit from 2005 to 2009.
A New Democracy spokesman, Yiannis Michelakis, countered that Georgiou undertook an "unlawful reconsideration" of the 2009 deficit under the direction of PASOK's minister of finance, which had the result of "further deteriorating the image of Greece abroad, thus causing demands for more painful measures and thus pushing (Greece) to a status of controlled bankruptcy."
A Greek government official, who said he wasn't authorized to be quoted by name, called the notion of a conspiracy outlandish.
"It's as if ELSTAT, Eurostat" — the Luxembourg-based Statistical Office of the European Communities — "the Department of State and the planet Mars conspired to change the deficit numbers so that Greece would have to turn to the IMF for more help," the official said. "It's crazy. It's even crazier that we are devoting part of our time" to responding to the charges.
One of the mysteries of Greece is how its top officials, often men of high intelligence and excellent academic credentials, could have managed the country into its economic abyss.
The dueling party leaders, Antonis Samaras of New Democracy and George Papandreou of PASOK, both former prime ministers, were roommates at Amherst College in Massachusetts. Georgiou, who also attended Amherst, got his Ph.D. from the University of Michigan, while Samaras attended Harvard Business School and Papandreou the London School of Economics.
Some say the problem in Greece is that the political system and the endemic infighting it generates debilitate the energies of the political elite and prevent honest debate about the country's problems.
The soft-spoken Georgiou, after spending 31 years in the United States, came to his post without the support of the political dynasties that helped propel Samaras and Papandreou to the post of prime minister. Georgiou was serving as the deputy chief of the IMF's statistics division as he watched news reports in 2009 detail Greece's statistical woes.
"It was extremely disconcerting," he told McClatchy last week. When a friend mentioned that Greece, at European insistence, was establishing an independent statistical institute, separate from the Finance Ministry, Georgiou applied to be its president.
"I thought I could contribute," he said, especially because he had "no ties, no political baggage." He applied on a government website and began his job in Athens in August 2010 trying to promote "good governance," not to cooperate with the political system.
"For everyone that works with Greece — whether they are decision makers or the markets — these statistics have to be reliable and undisputed according to international standards," he told McClatchy.
On a half-dozen occasions from 2005 to 2010, Eurostat issued "reservations" about the reliability of Greece's statements of its deficit and its proportion of debt to GDP. Before Georgiou's arrival, 10 special missions to Greece by the European Commission, the EU's executive body, had failed to bring the quality of Greek data to the level of the other EU countries, the commission said in a January 2010 report.
The report found "severe irregularities" in informing of the EU of excess deficits, "submissions of incorrect data and non-respect of accounting rules." Sometimes data were collected by telephone. Having the national statistical authority report to the Finance Ministry didn't guarantee the authority's independence, integrity and accountability.
But the problem went back further. In 2004, the Greek Finance Ministry issued higher estimates of the deficits in 2000 to 2004 — by 2 to 3 percentage points — because it had "misreported deficit figures" to the European Commission, the commission said. Indeed, the Greek government had been flouting the rules going back to 1996.
When he began his job, Georgiou discovered that he had to report to a board of experts — including a representative from a government employees' union — who wanted to have a say in the reporting of statistics to the EU. When he resisted, board members proposed to break up the institute.
After he learned that his official email account had been hacked, apparently by the deputy board chairman, and its contents distributed to the board, Georgiou went to the police and stopped holding board meetings. At his request, Parliament dropped all members of the board except the union representative.
Now Georgiou has to contend with the prosecutor in the conspiracy case against him, who's taken testimony from former board members, journalists and outside experts — everyone but Georgiou. After the prosecutor recommended that the case be turned over to Parliament, without hearing his defense, Georgiou went to the supreme court last week demanding to be heard.
All this despite a public letter from the head of Eurostat that defended Georgiou in no uncertain terms. Eurostat, Walter Radermacher wrote Dec. 1, "refutes all allegations that the deficit of 2009 was overestimated." The compilation of 2009 and 2010 data has been published "without any reservation ... in contrast with previous periods." Radermacher credited Georgiou and his staff with implementing "new and strengthened procedures" and "a high level of professionalism."
Now the question is whether the Greek political establishment will observe the European standards or insist on "Greek statistics."
Georgiou says he isn't cowed. "Things are very political here, very short term. We need to look to the long term," he said. "There needs to be spine and perseverance, to be stoical and just do it."
(McClatchy special correspondent Apostalis Fotiadis contributed to this article from Athens.)
MORE FROM MCCLATCHY
F-35 story shows why it's so hard to cut a federal program