Disclaimer: This will not be a popular article.

In our round up of usual suspects as to who is to blame for our current economic predicament we have been all-encompassing in assigning blame including politicians, bankers and businessmen in this notorious line-up. We have been very strict with all of them, some more than others, even over-zealous one would say, and we have assigned blame not only for actions taken but also for actions not taken that should have been taken and even for not forcing others to take actions that should have been taken. In many cases, we have been right in our criticism for our economic failure has been so monumental that it takes a large number of people from various posts and for a length of time to push a whole country into an economic abyss.

What is lacking in our criticism, or better, one who has escaped our harsh words has been ourselves. And yes we are to blame, maybe not all of us, or maybe some of us more than others (and I am sure as you read this you are thinking you are under the blameless category). And not only are we to blame but our collective responsibility probably equates or surpasses the one we are assigning to the usual suspects. And our blame lies in many levels which I will now go into the unpopular task of analyzing.

Firstly, we are to blame because as a society we have not matured enough and have not been intelligent enough to produce a level of discourse in our politics that is characterized by thoughtful arguments, understanding that right choices are not always the popular ones and understanding that the world is not black and white and real-life solutions involve compromise and pragmatism. And as all this probably sounds too theoretical cue the real life examples: discussion on COLA (also known as ATA), discussion on privatizations (also known as how to keep the few enjoying the super privileges financed by the many), recent discussion on social pensions, on Cyprus Airways, on banking payroll cuts and so many others.

We like so much to blame politicians of incompetence or corruption that we forget a very fundamental truth which is that in a democracy the elected leadership is a reflection of the quality of the underlying populace. Politicians pander to their electorate not because they know no better but because they want to be re-elected. Hence, to change the quality of the leadership we must first see how to change the quality of the society that produces this leadership.

Secondly, we are to blame because we do not understand that to achieve extraordinary results in any leadership post whether that is the Central Bank, or the Electricity Authority, or CYTA, or the Cyprus Tourism Board, or the Cyprus Stock Exchange you need extraordinary people and to attract extraordinary people you have to compensate them accordingly. And compensation should be linked to performance to incentivize individuals to apply themselves and achieve over and above the expected. Example: we are in badly need of a world class stock market. In case you have not noticed… we do not have one. But let’s say that the current stock exchange leadership works extremely hard, takes risks, has vision and manages to achieve this in the next few years. Do you know what difference this will make to the whole economy? Huge! Do you know what difference this will make to the financial reward of these people, the leadership, that will be responsible for this stunning success? None! In other words, the people who will have a direct impact on the future growth or not of the stock exchange have absolutely nothing to gain from it (other than a pat on the back maybe) and everything to lose in case their efforts do not succeed (in which case they will be blamed for the failure). Do you want to take a wild guess as to whether we will see an extraordinary result in this area?

We fail to understand that extraordinary individuals can change the course of history (Karl Marx will probably come to mind to a left-wing friend of mine who reads my articles) and in the business world, if you want to attract those extraordinary individuals you need to compensate them in a way that their financial success mirrors the success of the organization they lead. In plain words, you have to be willing to pay them what most people will think is too much (the case of the current BoC CEO is an example of this). As a society we do not subscribe to this notion. Our notion of equality is a similar to the assessment system in the public service where everyone is graded “Excellent” negating the very notion that the excellent are the exceptional and hence the few. And while we are not willing to compensate the exceptional, we are surprised when we end up with mediocre people and mediocre results.  

And finally we are to blame because we are undeserving of the quality of life we have. A lot of people like to work for fewer hours, have fewer responsibilities, have job security and have little to no stress at work. The difference is that in other countries, these same people do not expect to have all these and be paid the salaries we pay here and have the lifestyle we have here. And this is probably our most serious offense. 

In the past, we liked to make fun of those Europeans whose life was all work and no play. And we felt that we have found the right balance in life between work and play. But what we did not understand, and hearing the banker’s union demands evidently we still don’t, is that our celebrated

lifestyle, the one that involves daily trips to the gym, coffee with friends every afternoon, dining out 2-3 times a week, weekends at the beach, a large house (or a large apartment), a fancy car, a fancy watch, fancy clothes and handbags and fancy trips (plus trips to watch our favourite football team playing at the Champions League) is undeserving. This is a lifestyle that is being paid for by other people’s money because when you are being paid more than what you produce someone has to pay the difference. Compounding the problem is the fact that we are not only consuming more than what we are producing but as we want to consume more than what we are being paid we have borrowed the difference (enabled by our over eager banks) and then claim this lifestyle as being our entitlement. And you might feel that at the individual level the numbers are small but once you add all of us and you multiply that by many months and many years you realize that for a long time we have been sawing away the legs of our Atlas and finally he has shrugged.

So yes, the usual suspects were to blame for our predicament but in order for them to have failed us they needed a very large number of willing executioners, a large number of people willing to turn a blind eye to mismanagement and corruption, a large number of people to be under-producing and over-consuming and a large number of people to choose to stay on the sidelines and not take a stand… and they found them in us. So yes we are to blame, we are to blame deeply. Have we at least learned our lesson? No reason to answer, this is a rhetorical question. Worse, some of us think it is irrelevant! Why? Well, haven’t you heard? The gas God’s arrival is imminent, and he is about to wipe out all our sins, no need to repent or change, no need to face ugly truths… like a spoiled brat we are about to be saved by our wealthy father! …and if you think that then we are in more trouble than I thought!