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The principal utility of these claims is not to make a coherent legal case, or even to make a political case that will actually convince anyone who isn't a recent victim of German aggression.

The principal utility of this kind of claims is to create (more or less artificial) dividing lines between different creditor pools. Because such lines of division can be used to cut deals piecemeal.

It is an argument of the same form as "we will honor all commitments to the Eurosystem central banks (but the private banks who priced in a substantial risk premium can go fuck themselves)," and "we'll pay back the Eurogroup (but it would hardly be the first time the IMF has taken losses on their engagements)."

Similarly, "we'll pay back everything owed to the Eurogroup (but we don't owe Germany jack shit because of the War)" may or may not be a convincing legal, political, or economic argument. But if you're sitting in Helsinki or the Hague it might mean the difference between getting back 80 cents on the Euro and getting back 20 cents on the Euro.

And the enemies of Greece have shown repeatedly that their votes can be bought.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Mar 14th, 2015 at 02:06:49 AM EST
[ Parent ]
may or may not be a convincing legal, political, or economic argument.

If it isn't it isn't useful.

by IM on Sat Mar 14th, 2015 at 12:01:11 PM EST
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On the contrary, it does not need to be convincing on its merits as an argument.

It just needs to be introduced early enough in the discussion to provide a dividing line which can be said to have been on the table all the time.

Ultimately, this is not about morality, or legality, or even economics. It is about how Greece can sow division and disunity in the Troika. Setting the Belgians against the Germans and the Dutch against the Finnish and the Spanish against the Italians is a win for Greece. Which is why re-opening the postwar settlement is an excellent idea.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Mar 14th, 2015 at 01:16:50 PM EST
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"Setting the Belgians against the Germans and the Dutch against the Finnish and the Spanish against the Italians is a win for Greece."

Yes.

 "Which is why re-opening the postwar settlement is an excellent idea."

No. Is isn't achieving that.

by IM on Sat Mar 14th, 2015 at 01:43:41 PM EST
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That remains to be seen. It's created a dividing line which can later be used as the "principle" to govern which creditors get shafted and which get paid.

It makes a great deal of sense to attempt to create the perception that Germany is unique and separate from the rest of the Troika - because of the Troika, Germany is by far the Troika member holding the most Greek debt per Eurogroup vote, German public opinion is by far the most insane, and the German government is by some distance the most psychotic.

Maybe this particular attempt will work. Maybe it will fail. But nothing of importance is lost in the attempt.

So it's a low-probability, high impact, low cost gambit. That's the kind of cheap gambits you tend to play a lot of when you need results fast and don't particularly care about the collateral damage.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Mar 14th, 2015 at 03:34:57 PM EST
[ Parent ]

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