:00:03. > :00:13.for the club. Those are the headlines. Now it is
:00:13. > :00:29.
:00:29. > :00:33.Welcome. The very existence of the euro appears under threat. If
:00:33. > :00:37.Greece least, what for Greece and the eurozone and Britain? The head
:00:37. > :00:43.of the Bank of England says we are about to be hit by a euros storm.
:00:43. > :00:46.And the latest wheeze in the phone hacking scandal. Joining me today
:00:46. > :00:49.are Steve Richards of the Independent, Thomas Kielinger of
:00:49. > :00:51.Die Welt, Maria Margaronis of the Nation, and Dame Ann Leslie of the
:00:51. > :00:53.Daily Mail. Good to see you. Greece first and
:00:53. > :00:57.the people of Greece, not surprisingly, seem to hate the
:00:57. > :01:01.austerity forced upon them and has put them out of work. But the
:01:01. > :01:05.opinion polls say they want to stay in the euro. Is that possible?
:01:05. > :01:11.Ahead of more elections a political crisis on top of an economic crisis
:01:11. > :01:15.should they get out of the euro? Is that right? The people of Greece
:01:15. > :01:20.want to stay in the euro but don't but the conditions? Yes. Absolutely
:01:20. > :01:25.right. 80% of Greeks want to stay in the euro but in the last
:01:25. > :01:30.election about 70% voted against what are known as prone memorandum,
:01:30. > :01:34.the memorandum that supports the bail-out agreement voted against
:01:34. > :01:37.the pro Merrin and -- memorandum parties. There are the other
:01:37. > :01:42.parties that got them into the mess. The austerity programme is not
:01:42. > :01:45.working. People hate it. They are miserable. One thing I think is
:01:45. > :01:51.definitely not going to happen is that we are not going to continue
:01:51. > :01:56.with his programme. Right. The question is, can you then stay in
:01:56. > :02:01.the euro without the austerity? Some people say, OK, you want the
:02:01. > :02:05.benefits but card except the rules, including paying taxes. Come on.
:02:06. > :02:09.This thing about Greeks not paying taxes is exaggerated. There are
:02:09. > :02:14.many wealthy Greeks who do not pay them but the entire public sector
:02:14. > :02:19.which we always hear it is so overblown has to pay their taxes.
:02:19. > :02:24.Leaving aside taxes for a minute, I think, really, what happens depends
:02:24. > :02:28.on what happens in the eurozone. It is not just a great crisis. It is a
:02:28. > :02:32.general European crisis. -- a great crisis. There has been pressure
:02:32. > :02:37.from President Obama and Francois Hollande even from Mario Monti.
:02:37. > :02:46.There is also pressure from IMF saying we have to change tack.
:02:46. > :02:52.Germany has to change tack. Thomas? I don't like to be the wise man of
:02:53. > :02:58.last resort. Germany may be the main creditor nation. We are as
:02:58. > :03:02.bereft as everyone else how to solve the crisis. We don't like to
:03:02. > :03:07.call this thing austerity. David Cameron corset efficiency.
:03:07. > :03:16.There you are. It is a savings programme, one of the translations
:03:16. > :03:22.of the germs, isn't it? It is a good thing. -- of the Germans.
:03:22. > :03:25.Angela Merkel is supposed to have suggested the jerk Van -- the
:03:25. > :03:29.Greeks should have a referendum, not such a bad idea. The problem
:03:29. > :03:34.with democracy in debt-ridden countries, if you elect politicians
:03:34. > :03:39.that nobody trusts, you have to go one step further and get a
:03:39. > :03:44.plebiscite, asks the people themselves what they want. The
:03:45. > :03:51.problem its ears, the people governed by them do not trust. Why
:03:51. > :03:57.not us the people? It may be a sensible idea. But it is Angela
:03:57. > :04:06.Merkel who said it. If a great politician said it... George
:04:06. > :04:09.Papandreou it suggested such a thing. Went hysterical. There is a
:04:09. > :04:14.problem about framing the referendum that way. Take what you
:04:14. > :04:22.offer -- what you were offered, or leave. The Greek are saying, we
:04:22. > :04:26.can't do it. It is blackmail. it reasonable? Even if they do all
:04:26. > :04:31.of the right things according to this by 2020 there will still be in
:04:31. > :04:40.a mess. Yes. They had been in a mess for a very long time. Whatever
:04:40. > :04:47.you say, the public sector, which you agree, is terribly over blind.
:04:47. > :04:55.It's -- over bloated. The ratings were managed. They were paid for 14
:04:55. > :04:59.months in a year. No, no. That is not right. The Greeks have
:04:59. > :05:09.brilliantly created bits of accounting. Nobody wanted to pay
:05:09. > :05:13.tax. This was how pay rises were given. I know. That is a problem.
:05:14. > :05:23.am not saying the great state has been well run. Reform is necessary,
:05:24. > :05:25.
:05:25. > :05:32.but not this one. We always blame the Government's... The whole
:05:32. > :05:37.business of the eurozone... I have been against it ever since I went
:05:37. > :05:42.to Maastricht at the signing. I thought, it won't work, and I was
:05:42. > :05:46.right. People and your newspaper used to call people like me
:05:47. > :05:52.lunatics. We knew that it would not work and it hasn't. Of course it
:05:52. > :05:56.has worked in a sense for Germany. You have had the cheap money.
:05:56. > :06:04.that is not good enough for one country to benefit. We have to have
:06:04. > :06:08.prospered for all. I feel like... am of the view that the euro is the
:06:08. > :06:12.great red herring in this debate. Everybody is light, it is all about
:06:12. > :06:19.the euro. It the Greeks believe the euro, everything will be all right.
:06:19. > :06:22.What has happened is interesting. After the first crash of 2008, the
:06:23. > :06:28.eurozone and Britain recognised that Rose was the priority and they
:06:28. > :06:33.all agree to a fiscal stimulus, even Angela Merkel. -- that grows.
:06:33. > :06:36.It is to the credit of Gordon Brown and President Obama who pressed and
:06:36. > :06:42.pressed and pressed. There was a co-ordinated attempt to get roads.
:06:42. > :06:47.It worked. The economy started growing here and in most of the
:06:47. > :06:52.eurozone countries. There was a big shift. We can't carry on, we must
:06:52. > :06:57.cut. Austerity. And that happened before Rose had been fully re-
:06:57. > :07:07.established. There has been a policy broke -- problem. -- the for
:07:07. > :07:08.
:07:08. > :07:11.growth. Until they were up a way of getting the economy going, I agree
:07:11. > :07:17.with the metaphor, it is the equivalent of war in the economy.
:07:17. > :07:21.We must find a way of getting this economy growing again, that is, the
:07:21. > :07:27.whole of the EU. Until we do that, everything else in a way is
:07:27. > :07:37.irrelevant. Saif Greece goes out of the euro and devalues and all the
:07:37. > :07:41.other things, they will still have these problems. I wonder how
:07:41. > :07:49.significant the euro is in all of this. I think it is more about the
:07:49. > :07:58.economic policy. Do you agree? The United States is proving better
:07:58. > :08:05.than Europe. Moral hazard. If you keep borrowing to stimulate growth,
:08:05. > :08:10.it means that you keep on going on the old scene, which is, keep
:08:10. > :08:18.spending money and then somehow everything will come right. But it
:08:18. > :08:24.is knowing when to stop. If Greece falls out of the euro or it is
:08:24. > :08:34.driven out it is not necessarily a bad thing for them. When you think,
:08:34. > :08:35.
:08:35. > :08:41.in the 1990s, Argentina, Russia, South Korea, had to devalue and
:08:41. > :08:47.they started to thrive. It might have been Greece -- it might have
:08:47. > :08:50.been better if they never went into the euro. But they're dependent on
:08:50. > :08:54.imports now. There will be tremendous political upheaval. Of
:08:54. > :09:04.course it depends how it will come out. It the eurozone breaks up,
:09:04. > :09:05.
:09:05. > :09:11.which it might, break up or make- up... But to come out now will be
:09:11. > :09:18.devastating. Great people are already on the edge. In comparison
:09:18. > :09:22.to other countries, they were one of cases, Greece is different. It
:09:22. > :09:32.is part of a larger union. If one member leaves then the Union itself
:09:32. > :09:33.
:09:33. > :09:38.is up for grabs. For Angela Merkel there is no good choice. She either
:09:38. > :09:43.has to bail out the Greeks and therefore, quote, reward bad
:09:43. > :09:49.behaviour, which is a political problem in Germany, or not do that
:09:50. > :09:58.and face Greece leaving and the humiliation of that. She will have
:09:58. > :10:02.did to her sons and asked to sell, what is the worst? Still have to
:10:02. > :10:12.pay more for them leaving, or is the bill higher if we continue to
:10:12. > :10:13.
:10:13. > :10:21.support them? Create a bit of inflation. Let me remind you that
:10:21. > :10:27.40 years ago, 5% inflation, I prefer 5% unemployment. Those days
:10:27. > :10:33.are long gone. But she will have to come claim about these strict
:10:33. > :10:37.attitude. -- come clean. Maybe if they keep Greeks and what it will
:10:37. > :10:40.be cheaper. Let's move on. Where does this leave Britain? The
:10:40. > :10:44.Governor of the Bank of England warned of the storm heading our way.
:10:44. > :10:48.David Cameron in effect told the eurozone to get its act together.
:10:48. > :10:54.But outside Britain does anybody care what they think? What do you
:10:54. > :10:59.think? When you heard, make up or break up, it may be sound advice,
:10:59. > :11:09.but he is on the outside, spending Other People's Money. He is on the
:11:09. > :11:12.
:11:12. > :11:18.outside. It takes butt Britain it is in itself in recession. To
:11:18. > :11:25.proclaim on a sort of, follow last and you'll be better off... Britain
:11:25. > :11:29.is in a position of incredibly limited influence. It could make a
:11:29. > :11:34.difference, if its economy started growing. That would have a positive
:11:34. > :11:39.impact on the neighbours in Europe, and vice-versa. What is interesting
:11:39. > :11:45.about this is that those of us who could see the case for the euro a
:11:46. > :11:50.few years ago said, all the economies are so interconnected
:11:50. > :11:54.there is a case for an economic union that recognises that
:11:54. > :12:00.interconnection. What this crisis proves is just how committed they
:12:01. > :12:04.are. In other words, if Britain could change its rigid approach to
:12:04. > :12:08.the crisis and started growing, that would help the eurozone. But
:12:08. > :12:17.the lectures from British Chancellor or prime minister will
:12:17. > :12:24.be virtually ignored. ridiculousness of David Cameron
:12:24. > :12:29.lecturing Europe! What has gone wrong with their sanity? It wasn't
:12:29. > :12:36.so much a lecture that was the problem. It is what he said for the
:12:37. > :12:44.domestic audience. If he loses the export market, if the eurozone in
:12:45. > :12:48.close, then he has a problem. the content of what he had to say
:12:48. > :12:54.was effectively, they should be eurobonds, more fiscal
:12:54. > :13:01.centralisation. He is talking about a European superstate, isn't it?
:13:01. > :13:08.But not with Britain? It is rather like those people who are pro
:13:08. > :13:13.European superstate who say, it was the idea of -- promoted by
:13:13. > :13:18.Churchill. We forget, or choose not to remember that he said, except it
:13:18. > :13:23.or not include us. It is fair enough of David Cameron to express
:13:23. > :13:28.a view about how the eurozone should get out of it. It can only
:13:28. > :13:34.work with more political control. He is right. There are slightly
:13:34. > :13:37.separate issues. And again, he doesn't have to be part of it. But
:13:37. > :13:41.there is not -- another reason why he is doing it. And Mervyn King. If
:13:41. > :13:45.the British economy does not start growing soon he wants the story to
:13:45. > :13:48.be, this is all to do with the collapse of the eurozone. He would
:13:48. > :13:54.not be the first British Prime Minister for when things are going
:13:55. > :13:59.well to say, I am doing it. That is true for 50 years? The past 250
:13:59. > :14:03.years! But are nonetheless that is part of the reason he is doing that.
:14:03. > :14:07.He is also playing a game where he is on the one hand promoting growth
:14:07. > :14:12.in Europe and then doing whatever he can to protect the city of
:14:12. > :14:18.London which is the main reason he did not sign the fiscal treaty.
:14:18. > :14:28.And why yesterday he completely stumbled Francois Hollande of an
:14:28. > :14:32.
:14:32. > :14:37.I can understand. Britain is so dependent on the financial sector.
:14:37. > :14:43.There is a lot of talk about balancing the economy. But it will
:14:43. > :14:53.not do it overnight for 10 years. Anything that stifles the financial
:14:53. > :14:57.
:14:58. > :15:03.sector even more, where does the Greece come from? -- Rose. They are
:15:03. > :15:13.hoping to export their way out of the debt. That is a shocking
:15:13. > :15:15.
:15:15. > :15:24.realisation. I can understand. G8 summit is happening. People will
:15:24. > :15:29.be leaning on Angela Merkel. Barack Obama is suggesting that petrol
:15:29. > :15:35.supplies should be released. There are a few kinds of things that can
:15:35. > :15:45.be used. I am a great believer in democracy. But people to mess
:15:45. > :15:50.
:15:50. > :15:57.things up. You cannot actually get people to do what you think is wise
:15:57. > :16:04.without doing these grandstanding nonsense that others are doing. One
:16:04. > :16:10.of the things that Europe has been blind it to is the rise of Asia.
:16:10. > :16:17.That is where exports should have gone. But they are lazy. The
:16:17. > :16:27.English are lazy. The Germans, less so. The in thing is to own a
:16:27. > :16:29.
:16:29. > :16:34.Mercedes in China. On that, it is a slightly worrying element that
:16:34. > :16:43.every now and again we all think, these wretched collections are
:16:43. > :16:49.getting in the way. -- elections. Angela Merkel would not be able to
:16:49. > :16:53.do what she needs to do because she is facing an election. President
:16:54. > :17:00.Obama is out of this because he wants to win an election. And you
:17:00. > :17:08.start thinking, we could do without these elections. That is what has
:17:08. > :17:12.happened in Greece and Italy. flak that phrase, democracy is the
:17:12. > :17:22.worst form of government except for all others. Perhaps you could
:17:22. > :17:25.
:17:25. > :17:31.extend the duration of Parliament. There is another problem. We have
:17:31. > :17:39.allowed the financial markets to become far more powerful than the
:17:39. > :17:44.national democracy. Suddenly, greet debt and the interest payments and
:17:44. > :17:49.great debt shot up. There was nothing political, it was purely
:17:49. > :17:59.financial. It happened because they missed the boat on the American
:17:59. > :18:06.loans crisis. The why do people take the ratings agencies seriously.
:18:06. > :18:12.Does anybody know? I think there is a lot of corruption involved. The
:18:12. > :18:19.ratings agencies often have offices in the companies they are waiting.
:18:19. > :18:25.They drink together, fornicate together, smoke together. There are
:18:25. > :18:30.absolutely a branch of the company. They are supposed to be auditing
:18:30. > :18:36.them. There is a kind of corruption. Once they come up with these new
:18:36. > :18:40.issues, everyone is shouting from the rooftops. I was watching the
:18:40. > :18:45.last election on the television. There had been a market report
:18:45. > :18:54.coming in parallel with them. As if that was what we are actually
:18:54. > :19:04.interested in. The great people seem to be in 10 minds at the
:19:04. > :19:05.
:19:06. > :19:11.moment. -- greet people. There seems to be a couple of front-
:19:11. > :19:17.runners. We are going to end up with some sort of coalition
:19:17. > :19:26.government. I do not know what it will be. It depends on the next few
:19:26. > :19:31.weeks in Europe. There has been a terror campaign in Greece. A lot of
:19:31. > :19:41.people feel, at last, that some people are talking about the anger
:19:41. > :19:42.
:19:42. > :19:50.and despair. He is playing a massive game of chicken. He is
:19:50. > :19:55.saying, this is my position. We all have a stake in this. Rebecca
:19:55. > :20:03.Brooks was charged with obstructing justice this week. -- Rebekah
:20:03. > :20:09.Brooks. It could end up with a years in prison. She is Rupert
:20:09. > :20:18.Murdoch's former right-hand woman. How serious a moment is this for
:20:19. > :20:28.the British press? Also, for the British politicians. There is a
:20:28. > :20:32.revelation of closeness. It did not surprise me. Because of what I was
:20:32. > :20:38.saying about the ratings agencies. You get very close to the people
:20:38. > :20:44.you are supposed to be reporting on. If you start getting ridiculous
:20:44. > :20:53.legislation saying every time you have a talk with a minor official
:20:53. > :21:03.in the government you must record it. This will actually be very bad
:21:03. > :21:05.
:21:05. > :21:13.for news. Here is somebody who spends a lot of his life chat in to
:21:13. > :21:17.government. You would not be able to do your job if there was some
:21:17. > :21:25.gatekeeper saying, you have already met the Leader of the Opposition
:21:25. > :21:30.three times in the last seven months. How do you justified his? -
:21:30. > :21:39.- justified this. It will not work anyway. People will get a round all
:21:39. > :21:49.of this. Another thing that David Cameron did wrong was cover the
:21:49. > :21:50.
:21:50. > :21:58.whole problem over. In the olden days if you have an inquiry, if you
:21:58. > :22:03.send the people into the long grass. It is very dangerous. I wish it had
:22:03. > :22:12.not happened. I do not think you can teach human beings morality.
:22:12. > :22:15.Will it change the way you do your job? I suspect it might. But it
:22:15. > :22:24.would be absurd if journalists cannot speak privately to
:22:24. > :22:31.politicians. Four police officers. -- for police officers. This has
:22:31. > :22:38.gone on for hundreds of years. There is a naivety that will be
:22:38. > :22:44.driving the Levison inquiry. I keep on reading that voters are not
:22:44. > :22:50.interested in this. I think historians will look back on this.
:22:50. > :23:00.-- Leveson Inquiry. It will change the media culture in Britain. It
:23:00. > :23:06.was out of control. Phone hacking remains extraordinary to me. It was
:23:06. > :23:15.shocking. It was an industry that was partly out of control. It used
:23:15. > :23:20.to be in control. That will change for ever. No journalists will do
:23:20. > :23:29.this again. Politicians will be far more wary about dealing with
:23:29. > :23:37.proprietors and editors. Rupert Murdoch's summer party is coming up
:23:37. > :23:46.shortly. Half the Cabinet were there last year. None of them will
:23:46. > :23:52.be there this year. that would be such a bad thing.
:23:52. > :23:58.Newspaper proprietors and politicians have a lot to hide.
:23:58. > :24:05.Unless the press are watching them and analysing. The people are going
:24:06. > :24:13.to be left out of this incompletely. I am more interested about how this
:24:13. > :24:21.will affect politician culture. I believe there has been far too much
:24:21. > :24:27.stock in this relationship with the media. Everyone knew that after 18
:24:27. > :24:35.years of Conservative Mac Power, at a time for change was coming. The
:24:35. > :24:43.same happened in 1992. It was not because the Sun won it for them, it
:24:43. > :24:48.is because the people it. We have been assaulted by newspapers for
:24:48. > :24:56.the entire period. People may end up their mind irrespective of the
:24:56. > :25:06.newspaper. Newspapers are still powerful mediators. People do not
:25:06. > :25:09.
:25:09. > :25:14.watch newspapers -- politicians around the clock. It was an issue.
:25:14. > :25:20.There is no question as to the powers of the newspaper. I think
:25:20. > :25:23.that one of the problems here is the status of the media. There is
:25:23. > :25:28.no proper Freedom of Information Act. The media is reduced to
:25:28. > :25:35.competing for scandals and celebrity stories. There is no
:25:35. > :25:41.sense that they are happier watchdog it. And we have a Freedom
:25:41. > :25:47.of Information Act. What they were killing, the hacking of phones, was
:25:47. > :25:54.wrong. I cannot understand why the Murdoch press seems to think that