Greeks vote to reject incumbants, austerity

[LondonJohn]

Only question is how deep the feces will be.

I think a couple of people here who think that a Greek Exit would be a wonderful thing for Greece are going to be in for a shock if and when it happens.

It's not that Grexit will be "a wonderful thing" for Greece. It's that Greece leaving the Euro and devaluing to a New Drachma will be the least painful thing in the medium and long term for Greece.

Nobody should be under any delusions that the short-term impact on Greece of Grexit would be painful and volatile, and that the transition would have to be extremely carefully managed (and having politicians in power who were actually competent to manage the transition would be a big help....). But it's probably the only chance (and almost certainly the best chance by a long way) for Greece to rebase its economy, stabilise internal growth, inflation and the cost of living, and find its way back into a sustainable position in the global economy. The current fiasco (i.e. yesterday's "developments") are a) nothing more than putting a sticking plaster over a huge gaping wound, b) virtually guaranteed to give Greece very short-term relief, but long-term deeper problems, and c) very likely to cause anger and maybe even conflict within Greece, as politicians and the population grow to believe that they are being punished, humiliated and "overlorded" by Germany and the EU.

I have a feeling that Tsipras will (somehow) get the required new legislation through parliament by Wednesday, since the allure of immediate bail-out money might well override political principles and longer-term fears. But it will all end disastrously if this approach is followed to its logical conclusion. A glance at the Euro forex markets and Euro bond markets shows that "big money" isn't being fooled by the windy, fairy-tale-optimistic rhetoric coming out of Brussels and parts of Athens.

 

[caveman1917]

Then why would the Greek people vote in a government that would accept that deal?

A bit after the government was voted in:

The inauguration of George Papandreou as the 182nd Prime Minister of Greece took place on 6 October 2009.[11]

Upon inauguration, Papandreou's government revealed that its finances were far worse than previous announcements, with a year deficit of 12.7% of GDP, four times more than the Eurozone's limit, and a public debt of $410 billion.[12] This announcement served only to worsen the severe crisis the Greek economy was undergoing, with an unemployment rate of 10%[13] and the country's debt rating being lowered to BBB+, the lowest in the Eurozone.[14] Papandreou responded by promoting austerity measures,[15] reducing spending, increasing taxes,[16] freezing additional taxes and hiring and introducing measures aimed at combatting rampant tax evasion[17] and reducing the country's public sector. The announced austerity program caused a wave of nationwide strikes[18] and has been criticised by both the EU and the eurozone nations' finance ministers as falling short of its goals.[19]

What did the Greek people think of that? (in case the nationwide strikes weren't enough):

A poll in October 2011 on behalf of the Greek TV channel Skai TV and the newspaper Kathimerini (after the austerity measures that were taken to tackle the financial crisis) revealed that of the people asked, 92% felt disappointed by the government while only 5% believed that a PASOK government would be best for the nation in the next elections.[15] In the same survey, when asked about whether people have a positive or negative opinion of the various political parties in Greece, PASOK scored as the lowest, with 76% answering "negative".[15]

 

[LondonJohn]

BTW, with respect to my previous post, here is the daily movement in Euro:USD for yesterday (13/07/15). Note how the very quick spike after the "solution" was announced in Brussels was immediately followed by a steep plunge as the markets realised the proper implications, then a further steady decline in the Euro through the day. It's curtains.

 

[caveman1917]

The EZ is in the business of "payback"?

Not just any payback, payback against a population for voting "the wrong way" on a referendum.

 

[LondonJohn]

Not just any payback, payback against a population for voting "the wrong way" on a referendum.

I think that any implicit "payback" would actually be directly related to the Syriza Greek Government* endorsing and urging a "No" vote in the referendum.....


* You know, the same people responsible for negotiating Greece's debt situation in good faith with its creditors and the Eurozone leaders

 

[caveman1917]

I think that any implicit "payback" would actually be directly related to the Syriza Greek Government* endorsing and urging a "No" vote in the referendum.....

The proposal I have seen (austerity^2) seems to be directed towards the Greek people at large, for instance lowered pensions etc. Are you implying that these measures are only meant for the people in the Greek government? Others not having their pensions lowered etc.

ETA: the quote also does not seem congruent with your interpretation:

This, said the senior official, was payback for the emphatic no to the creditors’ terms delivered by the snap referendum that Tsipras staged a week ago.

 

[GlennB]

Yes, it's punishment, pure and simple, and the Troika isn't even bothering to disguise that fact.

Good luck Podemos

eta: An 'amusing' development:

Britain will be liable for close to £1 billion of emergency loans to Greece, it can be revealed, after Jean-Claude Juncker tore up a "black and white" deal to protect UK taxpayers from Eurozone bailouts.

 

[McHrozni]

Only question is how deep the feces will be.

I think a couple of people here who think that a Greek Exit would be a wonderful thing for Greece are going to be in for a shock if and when it happens.

Yeah. While it is true that under competent economic stewardship and a credible government it could be the least painful way to go, it is clear the current Greek government is neither.

Going after reporters who did not support your option on a referendum you won handily is not a recipe for disaster, it is a disaster. Revanchist censorship like this is a sufficient reason by itself to consider Syriza a clear and present danger to Greek democracy.

McHrozni

 

[McHrozni]

Tsipras Has Vandalized Greece



The tragedy seems to be that this was all unnecessary. The economy had finally returned to growth last year. It would have taken some years to get back to where they were before the crisis but things had been going in the right direction again:



[qimg]http://www.internationalskeptics.com/forums/picture.php?albumid=200&pictureid=9972[/qimg]

As you can see, money had been flowing back into the country in 2013 and 2014. Things were clearly not great, but they were starting to recover. GDP growth was positive and the unemployment rate was beginning to come down.

This progress all reversed when Tsipras started his game of brinksmanship with the creditors. Things went from bad but starting to mend to much, much worse.

I call that a tax on stupidity, the Greeks will pay for their stupidity at the ballot box. This isn't due to some sort of vengeance on behalf of the Troika, but a natural and logical consequence of making the obviously wrong decision at the wrong time. Tsipras played with fire and the fire burned him. All he's doing now is blaming his creditors for not accepting the humiliating terms he dictated in return for not doing anything of substance. He can't do anything better and remain in position, a sensible way would be to quit politics.

However, calling the deal a humiliation for Greece is not called for, I think. The terms are humiliating for Tsipras and Syriza, because it's clear his creditors no longer believe they will keep their word. I'm certain that a different government could get a much better result.

McHrozni

 

[Ts4EVER]

Revanchist censorship like this is a sufficient reason by itself to consider Syriza a clear and present danger to Greek democracy.

McHrozni

Not as much as a threat as the EU, which seems to be of the opinion that economy trumps democracy.

 

[McHrozni]

Not as much as a threat as the EU, which seems to be of the opinion that economy trumps democracy.

Not really, I think EU simply does not trust Tsipras. It demanded control over parts of the money they were pumping into Greece. Why would that be suspension of democracy?

McHrozni

 

[Oystein]

Who is responsible for the state of the Greek economy?
Who is responsible for the Greek Parliaments in the 1980s, 90s and 2000s that governed the Greek economy to where it was in 2010?
Who is responsible for enabling the Greek governments that produced hoaxes to be admitted to the Euro?
Who is responsible for the existence of a Sysriza government?
Who is responsible for rejecting an offer of help in that referendum?

If you think "Angela Merkel" or "Germany" think again. You may not have understood what "democracy" means. Hint: It's a Greek word.


Who should be held responsible for the joint decisions of decades of Greek governments up to the current one?
Europe?
Germany?
Think again!


When Greece voted "No", perhaps Europe should have suspended all emergency measures, all help, all negotiations, all talks for a month. Or half a year. The Greek people did not want the billions offered, it seems. What else could a "No" to an offer mean?

Or do any of you think votes taken by the Greek parliament or people are binding on anyone but the Greek government?


If someone came along and offered me tens of billion Euros to enable me to eat, live, breathe, pay my current dues and even invest a little bit, and I said "No" - would I not be a little bit responsible if the other side got a little ... upset?


Greece needs to change. Radically.
"No" meant that the Greeks are not willing to change radically. Their choice. Their responsibility. Let them eat the fruits of their own decisions of months, years and decades past. It's called "responsibility".
"No" meant that the Greeks were not interested in solidarity. I can live with that decision. It's their responsibility to face the consequences.
It is obvious that the unemployed youth, the poor retired lady, the student without hope who voted "no" did not want to accept a generous offer that, among others, I would have had to pay for. Why are they crying? Beggars are not choosers! Why is anyone whining if we ignore their "No"? They should thank us, on their damned knees, forever and ever and ever that we are so generously ignoring their stupid, irresponsible No and instead giving them more billions to waste!


[/rant]


(This is not realpolitik considerations; this is just a rant against all those who play the emotional cards. **** you, I say: I don't give a damn for your hurt feelings as long as I am saving your sweet ass even against your own, foolish decisions)

 

[Ts4EVER]

The (democratic) referendum rejected more austerity measures, only for the government to be strong armed into more austerity measures. The problem is that the sphere of the political is not even really wanted here. In present EU ideology, the doctrine of austerity is not discussable. It is portrayed as a neutral, rational administrative measure, like ordering more toner for your government copymachines when you run out. The "laws" of economy are seen as "natural laws" that can not be broken under any circumstances and are not subject to politics, much like you wouldn't vote on gravity or whatever.
This is utter bollocks. For one thing, an economy is manmade and these "rules" are so much hot air. Even if you don't believe that, there are actual economist disagreeing with the EU's measures, which indicates that there would be room for compromise or discussion, but this is not admitted by the Eurogroup. It is their way or the highway and they have Greece by the balls using economic blackmail.
Nobody denies that the Greek state is inefficient and corrupt. Tsipras never denied this. In fact, according to Varoufakis, he offered to pass legislation on taxes, vat and other point on which there was agreement between EU and the Greeks during the talks, but was told that only a comprehensive package was to be passed and any action by the Greeks would be seen as unilateral and a breech of trust. Then they go ahead and complain about the Greeks not reforming their state.
To me it seems the EU (or rather Schäuble) never intended for a compromise to be reached. Even though a restructuring of debt seems the only logical conclusion (which is something that is not without precedent), considering even the IMF seems aware that the money is essentially gone, this would be political suicide for Merkel et al after they foolishly took on private losses on the tax payer's dime. Could have just let the banks go under.
In fact, if any German politician reads this, I will vote for any party that is not in any way nationalistic and promises these two things:
1. The next time the banks screw themselves over, give them no bailout money.
2. Once they go under and the mob is closing in, call back the police.
That way we would finally get a trickle-down effect, even if it is just their feces tickling down their legs when they are hanged.
True freedom is not only choosing what to consume or who you can sleep with, it also means being able to determine the economic system of your society. With all these secret treaties and extortionary tactics, it seems clear to me that this is not wanted by those in power. If that isn't a threat to democracy, I don't know what is.

 

[Ts4EVER]

(This is not realpolitik considerations; this is just a rant against all those who play the emotional cards. **** you, I say: I don't give a damn for your hurt feelings as long as I am saving your sweet ass even against your own, foolish decisions)

If anyone is playing the emotional card it's the EU wringing their hands over "responsibility". It's pure moralistic reasoning, not a rational economic solution. All this of course based on the old racist stereotype of the lazy southerner having a siesta.

 

[McHrozni]

The (democratic) referendum rejected more austerity measures, only for the government to be strong armed into more austerity measures.

Then maybe the said government shouldn't accept austerity measures. It's not like anyone was forcing Tsipras to take the money.

As for referendum being democratic, I have significant doubts about that. A campaign that lasted less than a week, unclear question, lack of debate and state media that toe the party line, followed by harassment of journalists who dared to offer an opposing view all damage the credibility of the assertion the decision was democratic. If anything it was Tsipras that strong armed the Greeks into voting no.

Nobody denies that the Greek state is inefficient and corrupt. Tsipras never denied this. In fact, according to Varoufakis, he offered to pass legislation on taxes, vat and other point on which there was agreement between EU and the Greeks during the talks, but was told that only a comprehensive package was to be passed and any action by the Greeks would be seen as unilateral and a breech of trust. Then they go ahead and complain about the Greeks not reforming their state.

The creditors are not the ones responsible for fixing Greek economy, Greek government is. If Varufakis et.al. wanted Greek state to become sustainable they should've passed the legislation without it being a part of a deal with creditors. Unlike Syriza Troika isn't interested in horse trading, but in making Greece sustainable. It's surreal, if anything it should be the other way around.

True freedom is not only choosing what to consume or who you can sleep with, it also means being able to determine the economic system of your society. With all these secret treaties and extortionary tactics, it seems clear to me that this is not wanted by those in power. If that isn't a threat to democracy, I don't know what is.

Giving someone 50 billion euros in exchange for making his spending sustainable isn't extortion in any definition of the word I know. On the other hand, demanding huge sums of money in exchange for not doing something drastic that will damage the one with the money - as Tsipras did - is a clear-cut case of extortion.

https://en.wikipedia.org/wiki/Extortion
Extortion (also called shakedown, outwrestling, and exaction) is a criminal offense of obtaining money, property, or services from a person, entity, or institution, through coercion

Get your facts straight. Troika didn't take anything from Greece, nor did it want anything from Greece that did not belong to it. Wanting what you loaned back is not extortion. Demanding your creditor changes a loan into a donation, or else you'll do something to hurt the creditor, however is nothing but extortion. Demanding other people pay for your debts is not democracy, denying that unjust demand is not a threat to democracy, nor is it a lack of solidarity, as falsely presented by many.

McHrozni

 

[bit_pattern]

Then maybe the said government shouldn't accept austerity measures. It's not like anyone was forcing Tsipras to take the money.

This from a guy who thinks punishing a population with humanitarian crises for daring to vote the wrong way is a desirable outcome...

 

[angrysoba]

Define Rich. A number of people think anybody who makes a buck more then they do are rich....

If those people are Warren Buffet or Bill Gates then those people are right.

 

[angrysoba]

I'm a little surprised to learn that there is a Greek ship building industry. Would you trust your life to a boat built by Greeks?

I believe the Libyan Government did. I suppose that's faint praise though.

 

[Oystein]

...In present EU ideology, the doctrine of austerity is not discussable. ... The "laws" of economy are seen as "natural laws" that can not be broken under any circumstances and are not subject to politics

I am not even defending the EU position or their demands. Austerity and said laws are however essentially part of the deal, the treaties really, that the Greeks, by free, democratic decision, entered into when they wanted, out of their free, democratic will, to enter the Euro club.
It was the free, democratic decision of the free, democratic Greek governent to LIE to the Euroclub about their level auf austerity going into the club.

So Greeks, stop the whining, you are exactly in the mess that your own, democratic, free decisions steered you into.

...the Eurogroup... have Greece by the balls using economic blackmail.
Nobody denies that the Greek state is inefficient and corrupt. ...

It's a result of months, years and decades of free, democratic choices made by the Greeks that got them into a position where someone else could have them by the balls that much.
Don't whine about this.

I am not a fan of the compromise.
I think Greece should leave the Euro and get their act together.
EU and IMF should help shield them from hostile financial speculation.
There will be bail-outs anyway, and there will be debt cuts anyway.

But it is first and foremost up to the Greeks to admit to themselves that they ********** themselves up for decades, and to start getting their act together in earnest.
I don't mind a leftist government
As long as they work hard to get their act together. Don't negotiate about measures to get your act together - just do it!
And please say Ευχαριστώ! Ευχαριστώ! Ευχαριστώ! for any and every bit of help they are getting from outside!

No one in Germany or elsewhere is the least bit interested in insulting the Greeks - that makes absolutely no sense. We just don't want to throw too much more money on a whining child that refuses to get her act together.

[/rant2]

 

[McHrozni]

No one in Germany or elsewhere is the least bit interested in insulting the Greeks - that makes absolutely no sense. We just don't want to throw too much more money on a whining child that refuses to get her act together.

You should put the [/rant2] tag above this. This isn't a rant, it's the statement of obvious. I do find Greek behavior downright insulting though. It's as if somehow Europe is responsible for Greek debt troubles and it's up to Europe to solve it, not the other way around.

McHrozni