Since 1827 Greece has already, officially defaulted four times. Default no1 was at 1827, even before the official declaration of independence from the Ottoman Empire! England loaned the Greek revolutionaries in 1821 with 2,8 million pounds, in order to cover the war expenses. Just 20% of the total amount ended up in Greek hands. After the first default of the -unofficial back then- Greek state, the whole debt remained untouched. Although default means the inability to pay your debts, the revolutionary loans -plus interests- remained untouched.
That led to the 2nd official default, in 1843. Greek PM Ioannis Kapodistrias using his personal fortune and the loans from England and France -a 60 million French franks loan was given just from France, from which 33 millions were used to pay off the 1821 revolutionary loans-. Greece couldn't pay off the 1827 loans neither in 1843 -when defaulted- nor in 1893 the 3rd official Greek. Since 1879 Greece started to “unwillingly” receive new European loans, especially during 1880 and 1881. Greek PM Harilaos Trikoupis officially declared the 3rd Greek default using those historic words "We unfortunately bankrupted". The Greek debt in 1893 was app. 585 million French Franks.
Harilaos Trikoupis begged Europe for a new loan to avoid the disastrous effects of the Greek default. Europe refused. After his death Greece was led to a new war with Turkey, ending with the nightmare of the total economic control from the International Financial Commission.
Continuous depreciations of Greek drachmas kept Greece formally alive, until 1922. A new loan was received from the Union of Nations, as a result of the destruction of Smyrna, in -Aegean- coastal central Turkey, and because of the millions of immigrants, fled in Greece. A result of another unfortunate war with Turkey, fully supported and financed by England, France and Russia, that led to a total destruction.
Greece's total debt in 1931-1932 was estimated at app. 2,8 billion golden French Franks... Greek 4th default in 1932, under PM Eleftherios Venizelos was unavoidable.
Second world war and the mandatory Greek loans to the Nazis, besides the complete destruction of the Greek economy, brought Greece, along with the rest of Europe, back to the 19th century. The point is that when the whole Europe was being rebuild, Greece, after the straight directions of England and Russia, was immersed into an even more catastrophic civil war. Communists funded by Russia fought Righties funded by England and the US.
Greek catastrophic financial policy changed from 1955 to 1965. Spyros Markezinis managed to control the debt by negotiating part of the Greek debt and achieving the total payment for the 1821-1879 loans at 1967.
But in 1964-65 Greek PM George Papandreou (grandfather of current Greek PM, George Papandreou, father of Greece's PM from early 1980's to late 1990's -except the period between 1989-1991- Andreas Papandreou) along with Greek Minister of Economics Konstantinos Mitsotakis (leader of New Democracy party from 1984-1997, PM from 1990-1992, nephew of Eleftherios Venizelos) totally recognized the whole prior-polemic loans. That of course, included the loans from 1881 to the mid 60's -including interests-. The deal was that these loans would be repaid throughout a 45-year period of time, from 1964-2009, the year of the euro-zone economic crisis and the explosion of the current Greek debt-, as well as the year that his same named grandson won the elections!
Political instability followed by the class between George Papandreou and his son Andreas with King Constantinos of Greece, after Andreas' selection as the new Minister of Defense. A series of unfortunate elections, led to 1967's CIA supported military dictatorship in Greece, under Colonel George Papadopoulos. The new regime tried to deal with the huge debt agreeing to execute two terms, made by the US and Europe:
1.the so called "surface institutions" of the Aegean, the constitutional right to "rent" for a certain period of time the Aegean underwater area and its rich deposits of oil and gas to an individual.
2.The off-the-record, "surrender" of Cyprus.
The second term was partially achieved... The first deal failed because of the fall of the military dictatorship due to the aftermath of the war in Cyprus, between the Hellenic army and the Turkish military forces and the scandalous lack of reaction by the Greek Pentagon in 1973.
1977's new French loan was accepted under those very strict terms: Greece was obligated to buy French military vehicles (including frigates, warplanes etc.), French industrial material (cotton from La Coste etc.) and a lot of agricultural and other essential industrial products. The loans given to Greek governments, during the first years of the newly created European Union, were PM Konstantinos Karamanlis, the post military regime prime minister -uncle of the ex Greek PM Konstantinos Karamanlis from 2004-2009, where during his time of service, Greek debt was officially doubled-, succeeded to enter Greece, resulted in those two facts: Greece's industrialization and agricultural productivity evaporated! On the other hand Greece's imports of European and US products, and military equipment was rising in uncountable heights.
Corruption, using European loans that were supposed to boost an economy that could not rely on exports, created an exploding annual deficit that led to a dramatic, well known, but successfully hidden situation -hidden by the people of course, and not the EU government officials and the worldwide investors-.
Those terms, were forced as a partly repayment for the 1881-1945 loans. Loans totally recognized by the Greek government of George Papandreou, senior in 1964. One might say the deal of 1967 had nothing to do with today's conspiracy theories... But, all of a sudden, on March 13, 2011, Minister Christos Mpampoukis, under the strict directions of PM George Papandreou jr, suggested to the Greek parliament a plan called "surface institutions". The 1974 failure of the Papadopoulos' established regime just postponed the inevitable: Greece once more, negotiates the full surrender of her possible ground and underwater deposit sources.
Andreas Papandreou and Konstantinos Mitsotakis' years as PM -from 1981 to app 1996- were stigmatized with one single thing: the outcome foreign loans covered almost 100% of Greek money flow. Greek governments refused to get loaned from and deal with domestic investors, supporting only foreign corporations’ investments in industry, energy, transportation etc. Corporations like the German colossus, Siemens.
Kostas Simitis ministry's cooperation with Goldman Sachs' officials from 1996-1999 "helped" Greece, using complicated logistics, to hide under the carpet the greatest amount of the official debt, in order to allow her enter the Euro-Zone as an equal partner, who was supposed to cooperate and compete with Germany and French privatized industry under a unified hard coin, the EURO. Greece since 1827 was being loaned in several hard coins, such as golden English pounds, golden French franks and US dollars An act that abutted to four defaults and a current debt officially rated at app. 350 billion euros.
Current Greek PM, George Papandreou, was elected as a fully aware of this whole situation politician. After 30 years in politics, and his term in several ministries since the early 80's, he used those simple words: "Money DOES exist. Any cooperation with the IMF in order to receive a new loan to cut part of the huge debt will be disastrous."
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