A case of statistical significance in Greece

Summary

Podcast Summary: More or Less (BBC Radio 4) Episode: A case of statistical significance in Greece Date: February 4, 2013 Host: Ruth Alexander

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Episode Overview

This episode dives into the high-stakes controversy surrounding Greek statistical reporting during the country’s economic crisis. It centers on Andreas Georgiou, former head of Greece’s statistics agency, who faced criminal charges over recalculating the nation’s deficit figures. The episode investigates the statistical revisions, the political and personal fallout, and the broader implications for Greece and its international standing. The show also briefly debunks a pervasive myth about American football players’ life expectancy.

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Key Discussion Points and Insights

1. The Greek Statistics Scandal

• Introduction to the Case

  • Ruth Alexander introduces the “extraordinary” story: Andreas Georgiou, tasked in 2010 with heading the Greek statistics agency, faces up to five years in jail for allegedly “cooking the books” by inflating the Greek deficit. (00:13-00:50)
  • “They’re putting a man on trial for his statistical pronouncements with a maximum punishment of five years in prison.” – Ruth Alexander (00:15)

• Why the Recalculation?

  • Greece’s deficit figures had long been viewed with skepticism. Economist Miranda Zafa explains how public entities like the Greek Railways obtained government-backed loans, with debts kept “off the books.” Only when these loans came due would they appear as government debt, but not as deficits. (01:24-02:36)

    • “The railroad company used to have revenues that amounted to about 10% of the wage bill. These loans, they were off the books and only when the loan would be called by the bank and the government would have to pay it off. Then it would show up as general government debt, but without ever having shown up as a deficit.” – Miranda Zafa (01:56)

  • Georgiou corrected this by including the debts of 17 such entities, revising the deficit from 12-13% to 15.8% of GDP. (02:57)

• Political Fallout and Charges

  • Ruth asks why Georgiou faces criminal charges. Miranda Zafa expresses bafflement, suggesting investigations should focus on prior understatements, not the revision itself. (03:08-03:29)

    • “Beats me. If they should open an investigation in Greece, it should be as to why the deficit was understated in all previous years, not why it was revised upwards in 2009.” – Miranda Zafa (03:14)

  • Wesley Stevenson reveals intense internal politics—board infighting, email hacking charges, and rival statistical reports. This “office politics” turned a technical dispute into open conflict. (03:29-04:09)

    • “It’s no wonder that Mr. Georgiou once described Greek statistics as a combat sport.” – Wesley Stevenson (04:09)

2. Allegations and Conspiracy Theories

• Accusations of External Manipulation

  • Opposition MP Dimitris Sukalas (Syriza) believes Georgiou was pressured, possibly by the IMF or the government, to exaggerate the deficit in order to justify IMF intervention.

    • “I don’t know. IMF? The government? ... Because they wanted Greece in IMF. According to my opinion, many people, they did a lot of money out of that.” – Dimitris Sukalas (04:49 & 04:54)

• Validity of the Revised Figures

  • Wesley points out Georgiou’s numbers had backing from Eurostat (European Statistics Agency), the IMF, and the Greek government.

  • Economist Yanis Varoufakis explains that although statistics are “imprecise and dodgy,” Georgiou likely erred on the side of caution, resulting in higher figures but aiming to restore credibility.

    • “If you are to restore the Greek Statistical Office's reputation, you might as well err on the side of caution and on the side of overestimating the budget deficit rather than underestimating it.” – Yanis Varoufakis (05:25)

3. Broader Impact and Austerity

• Impact on Greek Society

  • Ruth Alexander clarifies that the revised deficit figures depicted Greece as needing urgent intervention, leading to an IMF bailout and harsh austerity. (05:44-06:10)

  • Sukalas claims that Georgiou’s calculations are now widely blamed for the events that led to IMF intervention and austerity:

    • “...the public opinion here believes that he was part of the chain that changed the whole population.” – Dimitris Sukalas (06:10)

  • Sukalas labels the resulting austerity a “disaster.” (06:24)

• Was Georgiou’s Recalculation Crucial?

  • Miranda Zafa rebuts the idea that Georgiou’s statistical revision alone triggered the crisis:
    • “Whether the Greek budget deficit was 15% of GDP or 13% doesn’t really change the fact that Greece had lost access to capital markets and had nowhere to turn for financing except to the European Union partners and the IMF.” – Miranda Zafa (06:54)

• Conclusion of Case

  • Georgiou’s fate is to be decided by the Greek judicial system, but the process is expected to be slow. (07:16)

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Memorable Quotes

• "They’re putting a man on trial for his statistical pronouncements with a maximum punishment of five years in prison." – Ruth Alexander (00:15)
• "If they should open an investigation in Greece, it should be as to why the deficit was understated in all previous years, not why it was revised upwards in 2009." – Miranda Zafa (03:14)
• "It's no wonder that Mr. Georgiou once described Greek statistics as a combat sport." – Wesley Stevenson (04:09)
• "If you are to restore the Greek Statistical Office's reputation, you might as well err on the side of caution and on the side of overestimating the budget deficit rather than underestimating it." – Yanis Varoufakis (05:25)
• "Whether the Greek budget deficit was 15% of GDP or 13% doesn’t really change the fact that Greece had lost access to capital markets and had nowhere to turn for financing except to the European Union partners and the IMF." – Miranda Zafa (06:54)

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Timestamps for Key Segments

• Background and Scandal Introduction – 00:13–01:56
• Explanation of Statistical Methods – 01:56–02:57
• Political Infighting and Conspiracy Claims – 03:08–04:09
• IMF Involvement and Austerity – 04:30–06:30
• Analysis of Whether the Revision Was Decisive – 06:30–07:16

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Additional Segment: The NFL "Zombie Statistic" (07:25–08:55)

• The podcast briefly debunks the myth that American football (NFL) players die younger than the average American. In reality, longitudinal studies show NFL veterans generally live longer, with lower rates of heart disease, cancer, and suicide, despite some higher risk of Alzheimer’s. The “die younger” claim persists despite contradictory evidence.

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Summary

This episode of More or Less unpacks a dramatic intersection of statistics, politics, and public perception in Greece’s economic crisis. It asks whether statistical transparency can come at personal cost and clarifies that, despite conspiracy theories and political backlash, reliable figures are essential—even when they reveal uncomfortable truths. It closes by affirming the importance of statistical integrity in public life and offers another example by debunking a persistent sports myth.

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For further listening or to contact the show: bbcworldservice.com/moreorless

Transcript

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[Ruth Alexander]

hello and welcome to More or Less on the BBC World Service. I'm Ruth Alexander. Now, we're used to stories about statistics being misused on more or less, but in Greece, they've taken it to a whole new level. They're putting a man on trial for his statistical pronouncements with a maximum punishment of of five years in prison. Wesley Stevenson's been following the story.

[Wesley Stevenson]

Yeah. Hi, Ruth. This story is extraordinary. It's the story of Andreas Siorgio, who was given the task of running the Greek statistics agency lstat back in 2010.

[Ruth Alexander]

And he's been accused of cooking the books, hasn't he?

[Wesley Stevenson]

Yes. And in doing so, he's accused of inflating the Greek deficit to look higher than it really was. Now, this is something he strongly denies, but he faces criminal charges for a breach of faith, something that's normally used against those who embezzle or misus public funds. And if found guilty, Mr. Georgiou, as you say, could face at least five years in jail.

[Ruth Alexander]

So he comes in as the new head of the statistics agency, recalculates the deficit and ends up facing criminal charges. Wow. Why did he decide to recalculate those figures in the first place, then?

[Wesley Stevenson]

Well, Greece was in real financial trouble at the time, and the government wanted to prove to the international community that the numbers coming out of Greece were right. That to get a picture of how bad things used to be, I spoke to economist Miranda Zafa. She used to write reports on Greece for the investment bank Salomon Brothers. And she says that everybody knew unofficially that the Greek deficit was much higher than the official figures said. And she said that one of their main tricks was to keep the interest payments of public entities off the books. She says the Greek Railways was a particularly bad example of this.

[Miranda Zafa]

The railroad company would go out and borrow from commercial banks with government guarantee, because without the guarantee, no creditor in their right minds would lend money to them. The railroad company used to have revenues that amounted to about 10% of the wage bill. These loans, they were off the books and only when the loan would be called by the bank and the government would have to pay it off. Then it would show up as general government debt, but without ever having shown up as a deficit.

[Ruth Alexander]

So there were public services and utilities like the Greek Railways, which were running huge losses while still able to borrow money with guarantees from the Greek government. But these loans were always deemed off the books and so never added to the government deficit. And what Andreas Georgiou did was put these debt payments back on the books.

[Wesley Stevenson]

That's right. He put the debts of 17 of these entities back on the books. And with a few other revisions, the deficit rose from 12 to 13% of GDP to 15.8%.

[Ruth Alexander]

And why is he now facing criminal charges, though?

[Wesley Stevenson]

Well, I put this to Miranda Zafa.

[Miranda Zafa]

Beats me. If they should open an investigation in Greece, it should be as to why the deficit was understated in all previous years, not why it was Revised upwards in 2009.

[Wesley Stevenson]

Now, some say the real reason that Andreas Georgiou is facing these charges actually comes down to politics. But not just the politics taking place in the Greek parliament office politics.

[Ruth Alexander]

So you mean who's got the staple or who's taking my scissors? That kind of thing? Surely not.

[Wesley Stevenson]

No, it's a little more serious than that. When Mr. Georgiu was first parachuted in as the head of the Greek Statistics Authority, he faced resistance from the board over his revised figures. They wanted to say they wanted to vote on it and he said no. And this is when it got really messy. The board turned against Mr. Georgieu. One board member has even been charged with hacking into his emails.

[Ruth Alexander]

What?

[Miranda Zafa]

Why?

[Wesley Stevenson]

One board member has been charged with email hacking?

[Ruth Alexander]

Wow.

[Wesley Stevenson]

Yes, it's no wonder that Mr. Georgieu once described Greek statistics as a combat sport. Eventually the board were fired and this resulted in strikes and protests. And then ex board member Professor Zoe Georgianta produced her own figures. And this is when the accusations that Mr. Georgieu artificially inflated the deficit first arose.

[Ruth Alexander]

But why would he be motivated to artificially inflate the deficit?

[Wesley Stevenson]

Well, this is something I asked Dimitris Sukalas, an MP with the opposition and anti austerity party Syriza. He told me he doesn't believe Mr. Georgiou wanted to inflate the deficit. He thinks he was told to do it by someone else. I asked him. Who?

[Dimitris Sukalas]

I don't know. Imf? The government?

[Wesley Stevenson]

Why? Why would they want to do that?

[Dimitris Sukalas]

Because they wanted Greece in imf. According to my opinion, many people, they did a lot of money out of that.

[Ruth Alexander]

This all sounds like we're in the realms of conspiracy theory, but do they have a point? Did he do his sums right?

[Wesley Stevenson]

Well, his figures are backed by Eurostat, the European Statistics Agency and the imf. And the Greek government has also said they have confidence in his figures. But Professor Yanis Varoufakis, an economist from the University of Athens thinks that Mr. Georgiou's figures, while broadly right, might be on the high side.

[Yanis Varoufakis]

As we know, statistics is a highly imprecise and dodgy enterprise at the best of times. And if you are to to restore the Greek Statistical Office's reputation, you might as well err on the side of caution and on the side of overestimating the budget deficit rather than underestimating it.

[Ruth Alexander]

The picture that Mr. Georgieu's figures painted was one of an economy in dire need of medicine, and this came in the form of the imf. And with the IMF came the austerity measures that are at the heart of all the strikes and protests in Greece.

[Wesley Stevenson]

Yes. So you can see why it's not been difficult to convince people that the consequences of Mr. Georgieu's recalculation were reason that Greece finds itself where it is today, which is something Dimitris Sokalis from Syriza points out.

[Dimitris Sukalas]

It was very probable that we avoided to go to imf, and the public opinion here believes that he was part of the chain that changed the whole population.

[Wesley Stevenson]

And what's the problem that you have with the imf?

[Dimitris Sukalas]

I say the problem with imf, it's the whole austerity measures, it's a disaster.

[Ruth Alexander]

So he's saying that people believe that Andreas Georgiou was an instrumental part of the chain of events that led to the intervention of the IMF and that this is why they're facing such harsh austerity measures in Greece. But is this true, though? Was his recalculation of the deficit really a crucial factor leading to the intervention of the imf?

[Wesley Stevenson]

Well, I put this to economist Miranda Zafa.

[Miranda Zafa]

Whether the Greek budget deficit was 15% of GDP or 13% doesn't really change the fact that Greece had lost access to capital markets and had nowhere to turn for financing except to the European Union partners and the IMF.

[Wesley Stevenson]

So Mr. Georgie's fate now lies in the hands of the Greek judicial system. But it's usually slow going and it could be some time before we know what happens.

[Ruth Alexander]

Ok, thanks, Wes. Now, there was a report this week that players in the NFL, that's the American Football League, are likely to die early than their fellow Americans. Now, you may think, well, that's not surprising. It's a rough old sport. And despite all the padding and the helmets, concussion isn't actually unusual. In fact, it's true that medical experts suspect that repeated head trauma of some players can lead to mental illness. Indeed, it's been noted that a number of NFL players have in the past killed themselves.

[Wesley Stevenson]

Yes, but these figures don't really give us the true picture.

[Ruth Alexander]

Wes, you're still here.

[Wesley Stevenson]

Yes, this stat that the NFL players die younger than other Americans is often quoted, and its latest outing was in the Boston Globe. But David Epstein from Sports Illustrated magazine wrote an article last year that showed that the research doesn't back this up. His article says that the National Institute for Occupational Safety and health in the US tracked nearly 7,000 players and issued a report in 1994 showing that former NFL players in general live longer. And last year, a second report again found that NFL players were outliving their fellow Americans, partly due to lower cancer rates. They also had a decreased risk of dying from heart disease, and the rate of suicide among NFL veterans was 59% lower than in the general population. The only area where the National Institute found a higher risk of death was associated with Alzheimer's. But overall, NFL players don't die earlier, and it's a shame that this stat refuses to go away.

[Ruth Alexander]

Wesley Stevenson and another Zombie statistic if you want to hear other editions of More or Less, you can go to our website, bbcworldservice.com more or less and you can get in touch with us via email to more or lessbc.co.uk There

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