SYRIZA: then you win

by Migeru Wed Jun 13th, 2012 at 05:02:00 AM EST

There is famous about social movements attributed to Gandhi: "First they ignore you, then they laugh at you, then they fight you, then you win". It appears SYRIZA may be on its way to winning. From Eurointelligence: Spain en route to a full ESM programme (13.06.2012)

The EU is willing to renegotiate the Greek program after the elections
The EU is willing to renegotiate the Greek program irrespective of the outcome of this Sunday’s elections in Greece, Financial Times Deutschland reports. According to the paper EU sources said that one could not refuse a renegotiation if the aim was to keep Greece in the eurozone. FTD quotes a member of the troika who says that the program is “off track” anyway. Wolfgang Schäuble told members of the CDU/CSU parliamentary group that the next troika visit to Athens after the constitution of a new government would officially proclaim that the program’s conditions had not been fulfilled. Also Jean-Claude Juncker is in favour of renegotiating the time table for deficit reduction in Greece as long as the substance of the program remains untouched. EU sources fear however that the readiness to renegotiate the Greek program might lead to the IMF’s withdrawal from the Greek program.

And, in other @AthensNewsEU

#Samaras‬: We want Greece to remain in the eurozone and we want to renegotiate (the memorandum)

SYRIZA: then you win | 30 comments (30 topical, 0 editorial, 0 hidden)

Re: SYRIZA: then you win (4.00 / 9)

Meantime, what presumably well-informed and well-intentioned people consider "the good guys" (because "they want to stay in the Euro") are becoming the bad guys:

On the other side (the Dark Side) Antonis Samaras rolled out his Law and Order agenda, which attempts to outflank Golden Dawn from the right. ND is by any reasonable definition a far right party now.

(talos)

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Wed Jun 13th, 2012 at 05:17:55 AM EST

Re: SYRIZA: then you win (4.00 / 2)

The targets will be moved but I bet the austerity cuts will not budge, nor will the demands to fire 150,000 civil service workers.

by Upstate NY on Wed Jun 13th, 2012 at 07:15:44 AM EST

Re: SYRIZA: then you win (4.00 / 6)

A swedish kind of death:

There is a difference between an ECB (acting in an ideologically and structurally setting that is opposed to the public sector) that refuses to understand or contemplate the way to stop the crisis and an ECB (acting in an ideologically and structurally setting that is opposed to the public sector) that knows how to stop the crisis but instead prolongs it as it is the basis of ECB:s ongoing power-grab and dismantling of social protections.
For one, it is the difference between not re-appointing the central bank managers in deficit countries and prosecuting them for treason. It also gives different answers to the question of what ECB does if a deficit country seriously moves to default. If they are stupid they crash their banks and force them out - removing the basis for ECB:s power in that country - if they are powerhungry they quickly renegotiate a deal that keeps up appearances while in reality letting the country a bit of the hook.

So powergrab it is. Which means that hardball the states should play.

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!

by A swedish kind of death on Wed Jun 13th, 2012 at 08:33:15 AM EST

Re: SYRIZA: then you win (none / 1)

The question then becomes: "How will Greece win?" Ceasing to add to the problem with expensive loans whose purpose is to protect creditors and that place all of the burden on Greek citizens would be a small step forward. Negotiating a writedown of this debt to a point where the creditors absorb as much pain as Greek citizens would be a much larger step. Telling the Troika: "Save your own banks, but don't add the cost to Greece's tab!" would be appropriate. But I cannot see anything other than a partial acceptance of ceasing to add to the problem as being acceptable to the Troika, while nothing less than a writedown, accompanied by full support from the ECB to Greece's banks would actually solve the problem.

Most likely is that bungled attempts to negotiate with a SYRIZA government would trigger financial panic in Europe that would put the whole situation in free fall, possibly ending in the destruction of the EMU. The question remains of what can be salvaged from the EMU, most likely X-Germany, at a minimum.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 09:58:13 AM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

Or the the EU & ECB come in and enforce "no deficits budget" and "rational tax system" and "collect due taxes" policies, AND ALSO enforce workers rights, pension system equity, infrastructure support, etc.

If Greece leaves, doesn't it seem likely that there will be a replay of the 1940s?

by asdf on Wed Jun 13th, 2012 at 11:07:37 AM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

Or the the EU & ECB come in and enforce "no deficits budget" and "rational tax system"

Pick one.

Also, with whose army? An EU viceroy in the Greek finance ministry who doesn't have an army with him would be sent home feet first in a zinc-lined pine box within the month.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 13th, 2012 at 11:11:48 AM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

I hate to use the U.S. as an example, because we have at least as many problems as Europe does, but the fact is that the military option is indeed something you need to maintain a federal system. There are plenty of examples of this in our history, starting with the initial problems with South Carolina.

http://en.wikipedia.org/wiki/Nullification_Crisis

Then the discussion continued to the Civil war, prohibition, the civil rights era, and up to now, even, with plenty of states wanting to take over certain federal responsibilities. It's a tough deal, but a practical federal system--at least one based on the U.S. model--has to have the power to enforce federal laws. Up to now, the E.U. has not confronted that point.

Here's an amusing picture of George Wallace trying to stand up for states' rights.

by asdf on Wed Jun 13th, 2012 at 12:35:21 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 3)

Of course you need a federal army and police force to have a functional federal government.

But the EU has neither at the moment, and establishing them is a long-term project, which means that it is not a solution to the present crisis. Also, a project that I would really rather prefer to have sane, pro-democracy people in charge of. Which the EU doesn't have either at the moment.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 13th, 2012 at 12:49:21 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

In the case of Greece, the EU has no military it could send because it would be very difficult to get the approval to send the military they have. Would Spain, Italy, Greece or even France vote for such action? To collect debts? I am not quite that dystopic - at least not yet.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 12:51:55 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 2)

Would Massachusetts and Pennsylvania vote to send troops to Alabama to force integration?

It's a moot point and I will now shut about it, but until Europe stops thinking like a loose confederation of sovereign countries and adopts an integrated model of some sort, these problems are not solvable. Not that they are automatically solvable in a federal system either, but at least it's possible.

by asdf on Wed Jun 13th, 2012 at 07:07:49 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 3)

Point granted, but it is probably a good thing, at present, that Europe is a loose confederation, given their resolutely doomed way of organizing their finances. IF those supporting this present 'gold standard' mentality accrue most of the blame for the results which it is producing and will produce that just might lay the foundation for a workable system. But a unified, federal Europe that ended up with anything like the current politics would be vastly worse than what they have.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 07:14:42 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

Our states are required to run balanced budgets. Federal programs are (mostly) funded at the federal level, and some states get more federal money than they pay in federal taxes, so from that viewpoint they do not have balanced budgets. But the state budgets are paid for using state taxes, and since the states can't print money, they are required to have balanced budgets.

by asdf on Wed Jun 13th, 2012 at 12:40:25 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 3)

Yeah, but the major contingent liabilities (retirement, medical support, unemployment, deposit insurance, employer-of-last-resort function) are federal. Federal coverage of contingent liabilities would solve the problem, of course.

Good luck getting that through Karlsruhe.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 13th, 2012 at 12:46:28 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 5)

Yeah, but the major contingent liabilities (retirement, medical support, unemployment, deposit insurance, employer-of-last-resort function) are federal. Federal coverage of contingent liabilities would solve the problem, of course.

The important thing here is not that it's Federal but that it's sovereign. That is, contingent liabilities are funded by a sovereign which is definitionally (and not balance-sheet) solvent.

The most important consequence of running the state like a private firm is that the state should not be in the business of providing free or implicit guarantees of any kind, as these are large "contingent liabilities" threatening to bankrupt the state. The threat of bankruptcy is real, as the state must fund itself by borrowing from private lenders, unable as it is to create money to fund necessary expenses deriving from the exercisising of implicit guarantees. One alternative to bankruptcy is default, but this is considered unthinkable as defaulting on obligations to fellow EU member states is "uneuropean". In addition, countries with a large primary trade deficit may find it impossible even to default.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Wed Jun 13th, 2012 at 01:04:21 PM EST
[ Parent ]

it's called democracy (none / 1)

Good luck getting that through Karlsruhe

Simple actually. It just needs a referendum. Without a referendum Karlsruhe will get very angry, but that isn't a bad thing.

by Katrin on Wed Jun 13th, 2012 at 03:28:35 PM EST
[ Parent ]

Re: it's called democracy (none / 0)

A referendum? By whom and for what?

res humà m'és aliè

by Antoni Jaume on Wed Jun 13th, 2012 at 05:19:14 PM EST
[ Parent ]

Re: it's called democracy (4.00 / 7)

By the German people to transfer sovereignty to Europe--because that's what it would be. It would be against Article 20 of our current constitution, which can't be altered, so we would need a new one, which requires a referendum. The Constitutional Court has made that abundantly clear. This judgement often is summed up as forbidding more transfer of sovereignty to Europe, but that isn't true: the court made clear what the procedure would have to be. So there can't be any secret deals. :-)

by Katrin on Wed Jun 13th, 2012 at 05:57:51 PM EST
[ Parent ]

Re: it's called democracy (4.00 / 2)

Just as the bankers have now, de facto, seized control of the governments in many countries, so could a de facto alliance of such governments push through a federalization of their power so as to extend it continent wide. Who would bet on PPP being a vigorous opponent of such a development, were their own governments so controlled by their own bankers?

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 07:24:26 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 0)

The People of the US of A see themselves as a single nation under god (TM). Around here there is no such thing (unless you are registered on eurotrib).

by cagatacos on Wed Jun 13th, 2012 at 04:49:02 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

Or the the EU & ECB come in and enforce "no deficits budget" and "rational tax system" and "collect due taxes" policies...

I believe it was Monti (?) in Italy who proposed a retroactive 'patrimony' tax on wealth. Greece could do the same and the Troika could assist them in collecting on those assets squirreled away in Switzerland, Luxembourg, etc. But it seems highly unlikely that they would be eager to do so as it would be reversing the direction of intended capital flow WRT wealthy/all others. Theoretically the EU could act to support workers rights, but, with the current composition of the Commission, Council and EP this seems highly unlikely, with the European Parliament being the most likely source of support.

As to a replay of the '40s, a lot would depend on the disposition of the military and the police. This time an elected government backed by the population might secure the protection of the military, not all of which is composed of Nazi sympathizers.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 12:48:06 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 0)

Austria and Luxembourg put the kibbosh a few weeks ago on new EU laws intended to allow more transparency into banking.

by Upstate NY on Wed Jun 13th, 2012 at 06:54:48 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 2)

As it stands now, though Germany can pick off the poorer countries one at a time. If Greece, Spain, Italy, etc. would vote as a block in a strong federal government, they could control what's going on. If we don't hang together we will hang separately, or something...

by asdf on Wed Jun 13th, 2012 at 07:10:10 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 2)

The peripheral countries should stand together in laying the foundation for their own post-Euro economic cooperation and management as well as protecting themselves against the further depredations of the ECB and the EU Council, even if they do not immediately move to a more rationally run currency union.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 13th, 2012 at 07:18:00 PM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 4)

asdf:

Greece, Spain, Italy, etc. would vote as a block in a strong federal government,

that's exactly what krugman said interviewed on rai news the other night.

</rocket science>

It's a fine line between homage, parody, and consumer opportunism. Jess Walter

by melo (melometa4(at)gmail.com) on Wed Jun 13th, 2012 at 07:50:07 PM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

On a democratical standpoint, Spain and Italy have already more vote than Germany, adding Portugal and Greece, and Ireland why not, they'd be a 50% more. Now the UE is quite more than theses countries, and votes would not be monolithic in them, but the same fact would apply to the whole eurozone. Here the problem is that the poors tend to disregard vote, when they aren't 'alienated' and vote against their interest.

res humà m'és aliè

by Antoni Jaume on Thu Jun 14th, 2012 at 02:11:25 PM EST
[ Parent ]

#WINNING (4.00 / 3)

Collapse Ahead - Wolfgang Münchau - Spiegel Online

...Spain and Italy would be focus of the crisis not Greece. ... existing rescue mechanisms wouldn't work if the crisis was exacerbated. ... EZB lends money to Spanish banks so they could lend to Spanish government. ESM lends to Spanish government so it can lend to Spanish banks. ... two drunks. ...Spanish needs to refinance 350 billion through 2014. ...Spanish could just about fit into the rescue scheme but there is no solution for Italy. ... eurobonds needed or even debt cut. ... Italy has to refinance 670 billion through 2014. ... political/financial/economic union would work. ... the restructuring effect would make it work. ... high interest rates increase pressure for Italy to leave Euro. ... doable for Italy because of low new debt. ... Italian domestic crisis suddenly over then. Ours would begin in earnest. ...massive German debt increase because of need to recapitalize banks and Target 2 loss. ... more damage to Germany than Italy if Italy exits. ... Either real union and conflict is moved to domestic level. ... Or Euro collapse and a different category of crisis.

by epochepoque on Wed Jun 13th, 2012 at 08:58:40 AM EST

Re: SYRIZA: then you win (none / 0)

Meanwhile, according to Ha'aretz, Greek Jews have the "impossible" choice between the Nazis and the non-Nazis.

by gk (g k quattro due due sette "at" gmail.com) on Wed Jun 13th, 2012 at 09:15:45 AM EST

Re: SYRIZA: then you win (4.00 / 8)

Now that, makes me angry. This is obscene. It equates people who not only deny the Holocaust but would gladly perpetrate it again (against both Jews and Muslims, not to mention gays and communists), with people who are programmatically opposed to anti-semitism. Historically it equates the side that helped Greek Jews escape Athens en masse during Nazi occupation, with the side that either actively collaborated with the Nazis or after the war plundered the properties of Greek Jews, denying descendants of the Holocaust victims and even survivors even a fair compensation for property confiscated by the clients of the Cold War regime...
The stuff the author writes about Tsipras are of course false but the interesting thing about them is that they circulate among the populist far-right in Greece as facts, where they have been picked up lately (despite lacking in evidence) by the new populist far-right: New Democracy. So this tells us something about the author's reading preferences...

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Wed Jun 13th, 2012 at 09:40:38 AM EST
[ Parent ]

Re: SYRIZA: then you win (4.00 / 5)

Sabby Mionis was born in Athens and moved to Israel in 2006. Founder of Capital Management Advisors and active in Greek business life

Probably the most informative sentence of the piece. Certainly the most honest. And so we see demonstrated, again and to nobody's great surprise, the contortions that the "captains of industry" will go through to avoid supporting social democracy.

I submitted a response to the article:

Tsipras et al ably stated Syriza's program in yesterday's Financial Times, so I shall not bother to dismantle the outrageous farrago of lies that is here being peddled about that party. I will simply note one smear in the article which is telling both because it is trivial to prove that it is a lie and because the fact that the columnist feels the need to lie about such a petty, inconsequential detail speaks volumes of his general integrity and moral habitus.
I speak, of course, of the slandering of Tsipras' facility with the English language. He is not, by any stretch of the imagination, in the bottommost half of Europe's politicians in this respect. It is doubtful whether his command of the Queen's English is even worse than that of the median American citizen.
Interviews between Tsipras and English-speaking reporters are easily found on the Internet, so the readers may judge for themselves if they do not wish to take my word on the matter.
May this missive find you in good health,
[signature, etc.]

Let's see whether they publish it. I'm betting a bag of pork rinds on "no."

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 13th, 2012 at 10:35:30 AM EST
[ Parent ]

Re: SYRIZA: then you win (none / 1)

It is doubtful whether his command of the Queen's English is even worse than that of the median American citizen.

That ain't right.

Be nice to America. Or we'll bring democracy to your country.

by Drew J Jones (pedobear@pennstatefootball.com) on Wed Jun 13th, 2012 at 01:41:28 PM EST
[ Parent ]

SYRIZA: then you win | 30 comments (30 topical, 0 editorial, 0 hidden)

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SYRIZA: then you win

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