We do have a deal—about Greece
It’s a proposal for a deal, anyway. The Greek Parliament has to approve.
Here’s what it looks like so far:
Monday’s deal requires Greece to give access to bailout monitors on the ground in Athens — including officials from the IMF, a point Tsipras resisted to the last.
He was elected on promises to reverse austerity and end intrusive monitoring, and the agreement will raise questions about whether he can continue in his post.
I keep reading the negotiations being referred to as a “marathon.” Apropos.
What Adolf, Stupid-ass Aryanism, the NDSAP, SS, Geheime Staatspolizei, wehrmacht, Panzer divisions, V1 rockets barely accomplished, Ms Merkel and Deutschland éœber Alles manage to conquer with cheap credit. Unless Greeks rebel, this German occupation will last longer than the last. Kreditkrieg has it all over blitzkrieg.
Kreditkrieg has it all over blitzkrieg.
I bow!
What was the purpose of the referendum?
Eric:
To make the people think they were being listened to?
Actually, I read in several places (don’t know if it’s true, though) that Tsipras thought the vote would go the other way, and was surprised at the result.
As the old saw goes, if you owe the bank a thousand dollars, you have a problem. If you owe the bank a million dollars, the bank has a problem. Greece owes lots of money to lots of banks.
Tsipras completely caved Monday morning. A totally craven capitulation in opposition to everything he promised and to the referendum. When sending the last proposal to the Troika, he already faced about 10 defections in his party. Now that the Troika has responded with even worse conditions, I imagine there could be mutiny.
The next hurdle comes on Wednesday, when reforms have to be passed into law by parliament. If they aren’t passed, the entire deal is off. In that case, Greece exits the Euro, converts to the Drachma and it is immediately devalued.
If they are passed, you might see riots, assassinations or a military junta. Seriously, we’re getting close to that now with the sense of outright betrayal from Syriza.
Honestly, I was surprised at the brazenness of Tsipras’ sellout. But maybe he was bought off or threatened…who knows? It’s one thing to buy off a single man, quite another to get the ruling party to codify treason into law. And that’s what it is: treason. Tsipras will be selling Greece (in some cases, quite literally) in order to bail out the Euro banks because only a pittance of any funds will ever go to the people.
In any event, I don’t see how this can end in a stable situation. It would be much easier to just end the farce but as I said, I think TPTB are now just trying to shift the burden onto the taxpayers of Europe.
A ceasefire agreement, which will almost certainly be accompanied by an “oil for food” scheme. And the rich get richer with left-wing economics (i.e. monopolies and regulated behaviors).
Breaking through the Spartan phalanx was always going to be tough.
What Athens is afraid of is an end to crony-capitalism.
The other, unspoken, Greek headache and heartache is the undocumented squatter population that at this time has reached epic proportions.
It’s the pleasant weather — combined with Greece’s proximity to those lands that have too many souls.
All around the Muslim world, population growth has been on a tear. Since Muslims devoutly refuse to control their own family size, the only biological remedy is pain and death.
Because for decades on end, those desert lands have ramped their populations something silly — enabled by artificially cheap foodstuffs.
Experiments with primates decades ago establishes that once population density gets out of hand, bizarre, violent behaviors become typical.
As long as Greece has, de facto, totally open borders — like America — she can’t begin to deal with the tsunami of fleeing Muslims headed her way.
BTW, major fights over mosque establishment have long been underway. The universal Greek position is that Muslims must move on — through, up and out. Greece is already fully occupied.
Greece has a gdp of 270B, and government spending accounts for about half of gdp. The official unemployment rate is near 30% but actually more like 50%. The new program under consideration will leave the Greeks with almost 350B of debt. How long before they need another bailout to pay interest and principle? My guess is no longer than 1 year.
Parker – it won’t leave them with 320b of debt because most of the new money is to pay off old debt. However the debt to GDP ratio is going to rise because the Greek economy will continue to contract.
This is a terrible deal for Greece. But it’ll probably pass in their parliament despite defections with the support of the opposition unless they see an opportunity to force elections.
Greek referendums are not binding advisory votes so there is no legal issue going against the results. I really do believe that the plan was to lose it though.
Parker – actually ignore my comment – I misread your post.
LT,
NBD. However, the bailout is really a ‘bailin’. The eu bankers will remain unshorn for a while as the Greeks are subjected to a buzz cut. In the end what is unsustainable will remain unsustainable.
Cherchez la femme.
Amoral …
Something that can’t go on forever, won’t. Debts that can’t be repaid, won’t be. Promises that can’t be kept, won’t be.
Glenn Reynolds
At Econlog, Scott Sumner writes that that Greece can also be seen as a surprising success story. Here’s a brief summary:
“[G]iven that Greece has chosen to use a non-market economic model, it’s done amazingly well. It’s done something no other sizable non-market economy has done — achieved developed country status without vast oil wealth.”
In this blog post, Sumner’s emphasis lies elsewhere, but connecting the dots isn’t hard. Greece has an economic system based on corruption, cronyism, and socialism. No other country with a similar system has done so well. Their success is based on massive fraud of German and French banks. Those banks have been paid off by the ECB and IMF, who now have the power to demand Greek structural reforms. If the Greeks accept those reforms, the economy will remain in severe recession for many years. If they reject the reforms, their economy will also remain in recession for many years, but there will be opportunities for renegotiation, evasion, and more fraud. If they’re rational, that’s the way they’ll go.
Given Greece’s culture, history, and economy; there’s almost no reason to believe that the country will seriously adopt neoliberal economic reforms. What’s far more likely are superficial reforms, lower levels of defrauding foreign banks, and a long-term stagnant economy.
I know nobody will care too much either way, but I wrote my comment above in too big of a hurry and ended up saying something completely backwards.
Here’s what I meant to say:
If the Greeks REJECT those reforms, the economy will remain in severe recession for many years. If they ACCEPT the reforms, their economy will also remain in recession for many years, but there will be opportunities for renegotiation, evasion, and more fraud. If they’re rational, that’s the way they’ll go.