Wednesday, June 17, 2015

Greece crisis: Greek Prime Minister Alexis Tsipiras came to power on a wave of Greek discontent of how the previous government refused to standby the people, now, Tsipiras is playing a ‘cat and mouse’ game which benefits no one, Greece needs to default and reset their economy, it’s too late for 'compromise' as proposed by United States

Dear All

The people of Greece have gone through some pretty hard times, more than they should have endured as a member of the EU. They faced what was savage austerity year in, year out, this led to the Greek people getting rid of their government.

It has to be said that the previous government was paralysed by indecision and made bad choices. The rest of the EU stood back and watched as Greek assets were sold off as part of the arrangements to get financial loans to keep the country solvent.

This should have never been allowed to happen.

One story I came across related how Greek pensioners were looking for food in bins. This isn’t the European dream of how the EU should operate. The Euro, although a decent idea on the drawing in a generalised concept was a nightmare in practical operation, the Euro works well if countries are doing well. In times of trouble, it is an anchor round the neck of a country helping pull it under.

The Greeks went to the polls because they had enough of the previous government, so in came a new lot, who were going to stand up for Greece. They were going to fix the problems and set the country back on the road to recovery. That promise came a cropper rather quickly, under the government of Greek Prime Minister Alexis Tsipiras.

Tspiras has played a really bad political game with other European countries, something which suits no one. At one stage we had the ridiculous spectacle of the Greek Prime Minister waffling on about damages he says is owed to the Greeks from World War 2 when the German Army invade the country.

Part of the Greek problem is that country’s economy could compete with the German powerhouse. Germany has a good mixed economy and decent manufacturing base producing high quality products like cars etc.

So, the Greeks are in limbo, Greek negotiations have failed again as Athens calls for 'realism' from its creditors. In two weeks, the country has to ante up and made a crucial IMF payment; rather then get their affairs in order, we are seeing a rather long winded drawn out play being enacted. To try and appear as a victim of sorts, Tsipiras is calling on European institutions to be realistic in their demands.

Realistic means, we don’t have the money, we can’t or won’t do cuts and we want talks which are meaningless in order to look like there is a dialogue happening when there is actually nothing. Talks between Athens and its creditors collapsed at the weekend, and looking at the passed record, it is likely they will collapse again, leaving the country at heightened risk of a default.

Once Greece does do a default, it would also have to put in place measures to bring back the Greek currency and then do an abrupt exit from the Eurozone. Although the lenders do have legitimate concerns, their position on demanding new cuts in pensions is simply untenable for the Greek Prime Minister to do. In fact, this would lead to crisis upon crisis and a lurch towards more extreme parties.
When you continually strip a people of their sovereignty, dignity and nationhood, you can expect at some point a backlash.

Tsipras says:

‘We will await patiently until the institutions accede to realism.’

This is a sign of a bad leader.

He added:

‘We are shouldering the dignity of our people, as well as the hopes of the people of Europe. We cannot ignore this responsibility. This is not a matter of ideological stubbornness. This is about democracy.’

You may have heard of the word ‘troika’, Max Keiser uses it a lot in his RT programme, the Keiser Report, a mix of political and financial news co host by his wife Stacy. The show is quite good as it gets in some very interesting people such as Reggie Middleton, Jim Rickards and Steve Keen. The ‘troika’ is the Washington-based IMF, the European Commission and the European Central Bank. You could make the case for Commission and the ECB being involved but not the IMF.

Greece owes a lot of money, it missed a £216million repayment and it rather looks like other deadlines in future will be missed. Germany’s EU commissioner Guenther Oettinger said an emergency plan should be worked out as Greece risks to fall into a state of emergency. He added ‘energy supplies, pay for police officials, medical supplies, and pharmaceutical products and much more’ needed to be ensured.

Tsipras is right when he says that years of cuts have only made Greece’s situation worse by shrinking the economy, making it harder to pay off debt. If he follows the demands of the ‘troika’, the Greek people will be permanently trapped in austerity. When you are in a hole, the rule of thumb is to stop digging, in Greece’s case, it is stop paying.

Belgian Finance Minister Johan Van Overtveldt said the euro zone's credibility would be damaged if agreements with Greece were changed, so is face saving more important than preventing people suffering?

Jens Weidmann, the head of Germany's central bank, said:

‘Time is running out for Greece. The willingness to do a deal and act is lacking.’

I would say that depends on what kind of a ‘deal’ Herr Weidmann, thinks is on offer, it rather looks like demands instead of negotiations. The fact that talks collapsed in less than an hour shows there is no common ground. This problem also highlights another concern, EU enlargement and access to the Euro without proper checks, Greece joined the Euro even although it should have been excluded based on it finances which some say were ‘cooked’ to meet the criteria.

The best thing for Greece but not the EU is a default, a lot of talk in European Capitals of late regarding the reform agenda, pushed along by David Cameron, who has his own domestic troubles, mostly sitting behind him on the back benches of the Commons. The Euro needs to be part of the reform agenda, and also a convention or commission for a new European Union with a view to capping membership for a minimum of two decades.

Other issues which should be placed on the agenda is the internal EU immigration policy and creation of a multi national EU border force, with nations seconding military vessels to deal with the illegal migration in the Med area.

The Greek tragedy currently playing out at the moment benefits no one, the ‘troika’ is being unreasonable especially in their demands to the Greek government to cut pensions. Tsipras doesn’t need to wait till ‘institutions accede to realism’, he needs to pull Greece out now or he won’t have a country worth saving.

Yours sincerely

George Laird

The Campaign for Human Rights at Glasgow University


Anonymous said...

What happens when a Flag waving protest party demands special treatment and to call the shots in a monetary union when times get hard?

Oh lets look at er Greece and Germany.

Just think, that could have been us and the UK!

Can you imagine being in a currency union, and Westminster vetoing an Indy Scotland's budget?

Can you just imagine the screaming from the SNP Monkey house if that were the case?

Greece and Germany are going to provide our hindsight, without us having to experience the associated economic disaster that would have happened with both FFA and Indy.

If only the Nat chimps had the wit to see it!


Anonymous said...

This is about as general as you could get.

They made massive mistakes. ( can we blame the SNP ? ) Learn from them.
Greece must not be allowed to leave for many reasons.
The Greeks are a wonderful race. Friendly, open, kind, fun to be around. They're nice people.
They have great produce.
They are non Islamic.
Greece is a wonderful country currently being destroyed further by Moslem immigrants.
Greece has been destroyed by greed. We have evidence of similar greed in all EU countries.
All EU overseas aid should be diverted to Greece and not to Islamic countries far richer than us.
I'm not connected to Greece BTW.

Freddy said...

I feel sorry for the Greeks have greek friends and am going to Crete in October. Unfortunately i see lots more pain on the horizon for them wether they stay or go from the Euro, looking at the whole situation just shows how much of a bullet we dodged the governing party reminds me of the nats all rhetoric and no solutions due to intransigence. You cannot keep borrowing money right enough at some point it has to be paid back I wonder who will be next the conditions for joining the Euro were fudged and fixed from the start. Now we are seeing the result of lots of countries gaining access to the international money markets for loans they wouldn't have had access to at the same rate prior to the Euro.

G Laird said...

Hi Freddy

The Greeks need to get out sooner rather than later.

Saving the country is number 1 priority.


Freddy said...

Couldn't agree more George

Anonymous said...

Stuart's spot on about comparing Greece-Germany with Scotland-UK.

You only need to listen to Sturgeon today moaning about the windfarm subsidies being removed. Quite right. £800 million is paid out! And there are 3,000 turbines awaiting planning permission - most in Scotland.

Money needs to go where it is essentially needed, not for schemes, which while are commendable, are simply bollocks in reality.

I notice however a distinct lack of comment from the SNP about Greece. No wonder.