For Greek Tax Reformers, Good Ideas Aren’t Enough

by Rachel Donadio

New York Times
February 3, 2012

For nearly two years, as the debt crisis worsened, Diomidis Spinellis led a team that devised innovative software to help Greece crack down on tax cheats. He sent daily reports to his superiors showing which regional tax offices lagged in closing cases and collecting tax revenue.

But last September, Mr. Spinellis, who interrupted a brilliant career as a computer science professor in 2009 to work for the Greek Finance Ministry, resigned, frustrated that officials did little or nothing with the data he generated.

“I cannot remember getting an enthusiastic response,” Mr. Spinellis, 45, said with characteristic understatement in an interview in his tiny, book-filled office at Athens University of Economics and Business, where he has returned to teaching.

In exchange for the bailout money that Greece needs by March to avoid what could be a catastrophic default, the country’s foreign lenders have demanded radical changes to make the state more efficient and bring in more tax revenue. But as Mr. Spinellis’s experience showed, good intentions and directives can easily be evaded or sabotaged by the political class, if its members have not signed on.

In Greece, the government of the technocratic prime minister, Lucas Papademos, is proving powerless to transform an inefficient public administration that has long served as a power base for the same political leaders — including most of the current government’s ministers — who are now being asked to dismantle it.

It is a formula for gridlock that virtually guarantees, political and financial experts say, that the Greek government will never carry out the kind of basic changes that are being demanded of it.

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