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The new Greek government program

by talos Mon Feb 23rd, 2015 at 07:27:12 PM EST




The gvt of Greece had, according to the February 20 deal in the Eurogroup, until today to send a list of "reforms" to its creditors, which would form the basis of a revised program. This has been agreed to be postponed until tomorrow morning [Tuesday 22]. According to a SYRIZA non-paper, translated by Damian Mac Con Uladh here is a general description of what the Greek government will be sending to the Eurogroup FinMins Tuesday:

front-paged by afew


This is what the Greek reform proposals to the Eurogroup are almost certain to contain:
  1. All of the measures included in the first pillar of the Thessaloniki Programme, concerning the way to address the humanitarian crisis.
  2. Big parts of the second pillar concerning the recovery of the real economy, with immediate priority given to: the settling of overdue debts, the protection of people with mortgage arrears as well as the ending of foreclosures of first residencies.
  3. The list includes all the structural reforms of the fourth pillar of the Thessaloniki Programme such as:
a. Fair and just tax system
b. Combating tax evasion
c. Combating entanglement and corruption
d. Combating smuggling (namely of fuel and tobacco)
e. Rebuilding of the public sector- reducing bureaucracy
  1. Labour reforms, particularly with regard to collective contracts and bargaining agreements [This means labor reforms reinstating collective bargaining, which was dismantled by the troika]
  2. No reference is made to to the renown OECD toolkit but to the Gurria- Tsipras agreement for necessary structural reforms needed by the country
  3. Finally, no reference is made of the reinstatement of the laid off workers in the public sector as the relevant minister has already declared that their reinstatement is included in the recruitments already programmed for in the budget. [Under the existing program Greece is allowed to hire up to 15.000 public sector workers, while the workers to be reinstated are around 3500]

As I've said in a comment in another thread:  

From what I have seen of the proposal being prepared, I would be pleasantly surprised if it is accepted by the German government. It focuses on administrative and tax collection reform, anti-corruption measures, and efficiency enhancers. Varoufakis and other ministers have guaranteed that no measures on labor market or pensions will be included. If this passes as is, it changes the score on the deal (which is IMHO now a small-score defeat in an away match against a vastly more powerful opponent) and the answer to the thread's question [Did Schäuble win?]

German Deputy Finance Minister Steffen Kampeter, in an interview with Paul Mason (more like a mauling actually. Paul Mason was angry) manages to imply that deposits in Greek banks are safe, and seems to be indicating that there won't be too much of a hard ride for an approval:

This remains to be seen, after we see the full list of reforms that the Greek government submitted, and the initial reactions to them.

Display:
I have no time to translate it, but this paper in Le Monde gives some details:

Les propositions de réforme de la Grèce arrivent à Bruxelles

Le patron de la zone euro, Jeroen Dijsselbloem, a déclaré devant le Parlement européen que « le gouvernement grec [était] très sérieux dans sa volonté de réformes », tout en rappelant qu'« il s'agi[ssai]t juste d'un premier pas » et que la finalisation des réformes « prendra[it] du temps ».

...

Une source européenne proche des discussions, citée par l'Agence France-Presse (AFP), affirmait toutefois que le gouvernement grec n'aurait pas renoncé aux mesures sociales d'urgence, dans le cadre de la lutte contre la « crise humanitaire », pour aider les plus vulnérables comme :

la fourniture d'électricité gratuite à 300 000 familles dans le besoin ;
l'accès gratuit aux soins médicaux pour les plus défavorisés ;
la distribution de coupons d'aide alimentaire ;
l'aide au transport pour les plus modestes ;
le soutien financier spécifique aux retraités touchant de faibles pensions.

La liste ne mentionnerait cependant pas l'augmentation du salaire minimal - de 580 à 750 euros - prévue par le parti Syriza, mais mal vue à Bruxelles. Toujours selon l'AFP, d'autres mesures retenues pourraient toutefois susciter le débat, comme le blocage des saisies de résidences principales et les mesures incitatives au paiement des arriérés d'impôts et d'emprunts bancaires passant par un effacement d'une partie des sommes dues.



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Tue Feb 24th, 2015 at 06:08:45 AM EST
By the way, going off on a tangent with a direct request to Bjinse: what's the view in the Netherlands? We are always dissing Hollande and Renzi as the useless centre-left, but with Dijsselbloem we have a social democrat who is an actual hawk in the arena. So what's the take by the local media and the parties?

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue Feb 24th, 2015 at 02:43:59 PM EST
[ Parent ]
During elections in 2012, the Labour party made a great show to return to their more social-democratic roots and abandon the Third Way. Of course, the moment the right-wing VVD-Labour coalition was formed, this was largely shown to be hollow election rhetoric. Therefore, we're now halfway this scenario:

European Tribune - Dutch Elections: Rather Rutte Than Red

both parties sacrifice their core issues one at the time - sometimes left wins, the other time right wins. Some progress will be made, but Rutte is a tough negotiator and the Netherlands will likely remain stuck in the neoliberal rut if a deal is brokered. The danger for taking this route is that both parties will be decimated in the next elections by an increasingly disgruntled electorate.

It's election time again - this time for the Senate - and both coalition parties, but particularly Labour, are heading for a thorough drubbing.

Still. Both parties embraced austerity measurements from the get-go, which Dijsselbloem strictly executed. Likely, it even helped him to get the post as chairman in the first place, as the Dutch were so keen to follow the German line. In short: no one is surprised in any way Dijsselbloem is behaving as a fiscal hawk. That has been clear since the government formed.

As for national Dutch media ;) there is not too much either. Past Monday, the left-leaning morning newspaper carried a reconstruction how Dijsselbloem forged the deal last Friday: by sidelining Varoufakis, organising a series of bilateral talks, calling straight to Tsipras and bringing Varoufakis in only at the very end. Very little about what this all means economically. The overarching conclusion was: the Greek rebels smashed their teeth on the walls of the European system which prevailed as wont. Most, if not all, papers wrote this weekend about the 'capitulation' of Greece - though this is typical winner takes all journalism rah rah.

I conclude by psychoanalysing media behaviour on complete whim: The Netherlands are a small nation. We're (unconsciously) chuffed with Dutch peeps that landed themselves in Serious chairs. We analyse (mostly) how they perform (because optics), not how they behave according to their ideological colour. Labour is embracing Third Way politics & austerity now for so long, it's taken for granted and no longer even needs mentioning because everyone knows it, and really, we're far too tired to type about it because what's the point and the beer is waiting anyway.

by Bjinse on Tue Feb 24th, 2015 at 04:35:46 PM EST
[ Parent ]
Greek bailout: Athens submits reform plan - live updates | Business | The Guardian

Reuters has now published the full text of Greece's reforms.

At first glance it is broadly as expected -- lot of commitments to reform the tax base, fight corruption, and improve Greece's public sector.

There are also several clear concessions to its creditors. Athens is pledging not to reverse the state asset sales that are already underway. And it says it will aim to raise minimum wages in a manner that "safeguards competiveness and employment prospects", and in consultation with its partners.

The government is also promising help for families and businesses who simply cannot pay their debt, while clamping down hard on "strategic defaulters".

It's rather long, but I've pasted it in full here
I. Fiscal structural policies

Tax policies - Greece commits to: 

Reform VAT policy, administration and enforcement. Robust efforts will be made to improve collection and fight evasion making full use of electronic means and other technological innovations. VAT policy will be rationalised in relation to rates that will be streamlined in a manner that maximises actual revenues without a negative impact on social justice, and with a view to limiting exemptions while eliminating unreasonable discounts.

 Modify the taxation of collective investment and income tax expenditures which will be integrated in the income tax code.

 Broaden definition of tax fraud and evasion while disbanding tax immunity.

 Modernising the income tax code and eliminating from it tax code exemptions and replacing them, when necessary, with social justice enhancing measures.

 Resolutely enforce and improve legislation on transfer pricing.

 Work toward creating a new culture of tax compliance to ensure that all sections of society, and especially the well-off, contribute fairly to the financing of public policies. In this context, establish with the assistance of European and international partners, a wealth database that assists the tax authorities in gauging the veracity of previous income tax returns.

Public Finance Management

Greece will: 

Adopt amendments to the Organic Budget Law and take steps to improve public finance management. Budget implementation will be improved and clarified as will control and reporting responsibilities. Payment procedures will be modernised and accelerated while providing a higher degree of financial and budgetary flexibility and accountability for independent and/or regulatory entities.

 Devise and implement a strategy on the clearance of arrears, tax refunds and pension claims.

 Turn the already established (though hitherto dormant) Fiscal Council into a fully operational entity.

Revenue administration

Greece will modernise the tax and custom administrations benefiting from available technical assistance. To this end Greece will:  Enhance the openness, transparency and international reach of the process by which the General Secretary of the General Secretariat of Public Revenues is appointed, monitored in terms of performance, and replaced.

 Strengthen the independence of the General Secretariat of Public Revenues (GSPR), if necessary through further legislation, from all sorts of interference (political or otherwise) while guaranteeing full accountability and transparency of its operations. To this end, the government and the GSPR will make full use of available technical assistance.

 Staff adequately, both quantitatively and qualitatively, the GSPR and in particular the high wealth and large debtors units of the revenue administration and ensure that it has strong investigative/prosecution powers, and resources building on SDOE's capacities, so as to target effectively tax fraud by, and tax arrears of, high income social groups. Consider the merits of integrating SDOE into GSPR.

 Augment inspections, risk-based audits, and collection capacities while seeking to integrate the functions of revenue and social security collection across the general government.

Public spending -

The Greek authorities will:  Review and control spending in every area of government spending (e.g. education, defence, transport, local government, social benefits)

 Work toward drastically improving the efficiency of central and local government administered departments and units by targeting budgetary processes, management restructuring, and reallocation of poorly deployed resources.

 Identify cost saving measures through a thorough spending review of every Ministry and rationalisation of non-salary and non-pension expenditures which, at present, account for an astounding 56% of total public expenditure.

 Implement legislation (currently in draft form at the General Accounts Office - GAO) to review non-wage benefits expenditure across the public sector.

 Validate benefits through cross checks within the relevant authorities and registries (e.g. Tax Number Registry, AMKA registry) that will help identify non-eligible beneficiaries.

 Control health expenditure and improve the provision and quality of medical services, while granting universal access. In this context, the government intends to table specific proposals in collaboration with European and international institutions, including the OECD.

Social security reform -

Greece is committed to continue modernising the pension system. The authorities will:  Continue to work on administrative measures to unify and streamline pension policies and eliminate loopholes and incentives that give rise to an excessive rate of early retirements throughout the economy and, more specifically, in the banking and public sectors.

 Consolidate pension funds to achieve savings.

 Phase out charges on behalf of `third parties' (nuisance charges) in a fiscally neutral manner.

 Establish a closer link between pension contributions and income, streamline benefits, strengthen incentives to declare paid work, and provide targeted assistance to employees between 50 and 65, including through a Guaranteed Basic Income scheme, so as to eliminate the social and political pressure for early retirement which over-burdens the pension funds.

Public administration & corruption - Greece wants a modern public administration. It will:  Turn the fight against corruption into a national priority and operationalize fully the National Plan Against Corruption.

 Target fuel and tobacco products' smuggling, monitor prices of imported goods (to prevent revenue losses during the importation process), and tackle money laundering. The government intends immediately to set itself ambitious revenue targets, in these areas, to be pursued under the coordination of the newly established position of Minister of State.

 Reduce (a) the number of Ministries (from 16 to 10), (b) the number of `special advisors' in general government; and (c)

fringe benefits of ministers, Members of Parliament and top officials (e.g. cars, travel expenses, allowances)

 Tighten the legislation concerning the funding of political parties and include maximum levels of borrowing from financial and other institutions.

 Activate immediately the current (though dormant) legislation that regulates the revenues of media (press and electronic), ensuring (through appropriately designed auctions) that they pay the state market prices for frequencies used, and prohibits the continued operation of permanently loss-making media outlets (without a transparent process of recapitalisation)

 Establish a transparent, electronic, real time institutional framework for public tenders/procurement - re-establishing DIAVGEIA (a side-lined online public registry of activities relating to public procurement)

 Reform the public sector wage grid with a view to decompressing the wage distribution through productivity gains and appropriate recruitment policies without reducing the current wage floors but safeguarding that the public sector's wage bill will not increase  Rationalise non-wage benefits, to reduce overall expenditure, without imperilling the functioning of the public sector and in accordance with EU good practices  Promote measures to: improve recruitment mechanisms, encourage merit-based managerial appointments, base staff appraisals on genuine evaluation, and establish fair processes for maximising mobility of human and other resources within the public sector

II. Financial stability

Instalment Schemes.

Greece commits to:

Improve swiftly, in agreement with the institutions, the legislation for repayments of tax and social security arrears  Calibrate instalment schemes in a manner that helps discriminate efficiently between: (a) strategic default/non-payment and (b) inability to pay; targeting case (a) individuals/firms by means of civil and criminal procedures (especially amongst high income groups) while offering case (b) individuals/firms repayment terms in a manner that enables potentially solvent enterprises to survive, averts free-riding, annuls moral hazard, and reinforces social responsibility as well as a proper re-payment culture.

 De-criminalise lower income debtors with small liabilities 

Step up enforcement methods and procedures, including the legal framework for collecting unpaid taxes and effectively implement collection tools

Banking and Non-Performing loans.

Greece is committed to:  Banks that are run on sound commercial/banking principles  Utilise fully the Hellenic Financial Stability Fund and ensure, in collaboration with the SSM, the ECB and the European Commission, that it plays well its key role of securing the banking sector's stability and its lending on commercial basis while complying with EU competition rules.

 Dealing with non-performing loans in a manner that considers fully the banks' capitalisation (taking into account the adopted Code of Conduct for Banks), the functioning of the judiciary system, the state of the real estate market, social justice issues, and any adverse impact on the government's fiscal position.

 Collaborating with the banks' management and the institutions to avoid, in the forthcoming period, auctions of the main residence of households below a certain income threshold, while punishing strategic defaulters, with a view to: (a) maintaining society's support for the government's broad reform program, (b)

preventing a further fall in real estate asset prices (that would have an adverse effect on the banks' own portfolio), (c)

minimising the fiscal impact of greater homelessness, and (d)

promoting a strong payment culture. Measures will be taken to support the most vulnerable households who are unable to service their loans  Align the out-of-court workout law with the instalment schemes after their amendment, to limit risks to public finances and the payment culture, while facilitating private debt restructuring.

 Modernise bankruptcy law and address the backlog of cases

III. Policies to promote growth

Privatisation and public asset management:

To attract investment in key sectors and utilise the state's assets efficiently, the Greek authorities will:  Commit not to roll back privatisations that have been completed. Where the tender process has been launched the government will respect the process, according to the law.

 Safeguard the provision of basic public goods and services by privatised firms/industries in line with national policy goals and in compliance with EU legislation.

 Review privatisations that have not yet been launched, with a view to improving the terms so as to maximise the state's long term benefits, generate revenues, enhance competition in the local economies, promote national economic recovery, and stimulate long term growth prospects.

 Adopt, henceforth, an approach whereby each new case will be examined separately and on its merits, with an emphasis on long leases, joint ventures (private-public collaboration) and contracts that maximise not only government revenues but also prospective levels of private investment.

 Unify (HRDAF) with various public asset management agencies (which are currently scattered across the public sector) with a view to developing state assets and enhancing their value through microeconomic and property rights' reforms.

Labor market reforms

Greece commits to: 

Achieve EU best practice across the range of labour market legislation through a process of consultation with the social partners while benefitting from the expertise and existing input of the ILO, the OECD and the available technical assistance.

 Expand and develop the existing scheme that provides temporary employment for the unemployed, in agreement with partners and when fiscal space permits and improve the active labour market policy programmes with the aim to updating the skills of the long term unemployed.

 Phasing in a new `smart' approach to collective wage bargaining that balances the needs for flexibility with fairness. This includes the ambition to streamline and over time raise minimum wages in a manner that safeguards competiveness and employment prospects. The scope and timing of changes to the minimum wage will be made in consultation with social partners and the European and international institutions, including the ILO, and take full account of advice from a new independent body on whether changes in wages are in line with productivity developments and competitiveness.

Product market reforms and a better business environment

As part of a new reform agenda, Greece remains committed to: 

Removing barriers to competition based on input from the OECD.

 Strengthen the Hellenic Competition Commission.

 Introduce actions to reduce the burdens of administrative burden of bureaucracy in line with the OECD's input, including legislation that bans public sector units from requesting (from citizens and business) documents certifying information that the state already possesses (within the same or some other unit).

 Better land use management, including policies related to spatial planning, land use, and the finalisation of a proper Land Registry  Pursue efforts to lift disproportionate and unjustified restrictions in regulated professions as part of the overall strategy to tackle vested interests.

 Align gas and electricity market regulation with EU good practices and legislation Reform of the judicial system - The Greek government will:  Improve the organisation of courts through greater specialisation and, in this context, adopt a new Code of Civil Procedure.

 Promote the digitisation of legal codes and the electronic submission system, and governance, of the judicial system.

Statistics - The Greek government reaffirms its readiness to:  Honour fully the Commitment on Confidence in Statistics, and in particular the institutional independence of ELSTAT, ensuring that ELSTAT has the necessary resources to implement its work programme.

 Guarantee the transparency and propriety of the process of appointment of the ELSTAT President in September 2015, in cooperation with EUROSTAT.

IV. Humanitarian Crisis -

The Greek government affirms its plan to: 

Address needs arising from the recent rise in absolute poverty (inadequate access to nourishment, shelter, health services and basic energy provision) by means of highly targeted non-pecuniary measures (e.g. food stamps).

 Do so in a manner that is helpful to the reforming of public administration and the fight against bureaucracy/corruption (e.g. the issuance of a Citizen Smart Card that can be used as an ID card, in the Health System, as well as for gaining access to the food stamp program etc.).

 Evaluate the pilot Minimum Guaranteed Income scheme with a view to extending it nationwide.

 Ensure that its fight against the humanitarian crisis has no negative fiscal effect.



It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Tue Feb 24th, 2015 at 06:14:53 AM EST
VAT policy will be rationalised in relation to rates that will be streamlined in a manner that maximises actual revenues without a negative impact on social justice

They should put a high VAT rate on luxury goods, including German cars...

"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet

by Melanchthon on Tue Feb 24th, 2015 at 06:24:56 AM EST
[ Parent ]
And what about imposing VAT on some types of financial services?
by gk (gk (gk quattro due due sette @gmail.com)) on Tue Feb 24th, 2015 at 06:31:38 AM EST
[ Parent ]
Especially on the more prevalent 'financial disservices'.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 09:18:54 AM EST
[ Parent ]
Identify cost saving measures through a thorough spending review of every Ministry and rationalisation of non-salary and non-pension expenditures which, at present, account for an astounding 56% of total public expenditure.
Anyone know what the comparable figure is for other countries?
by gk (gk (gk quattro due due sette @gmail.com)) on Tue Feb 24th, 2015 at 06:37:59 AM EST
[ Parent ]
If you want to read them on PDF...

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 06:47:57 AM EST
[ Parent ]
the issuance of a Citizen Smart Card that can be used as an ID card, in the Health System, as well as for gaining access to the food stamp program etc.

I just picked this up on re-reading. This amounts to the electronic infrastructure that could support the roll-out of an under-the-radar alternative currency. Food stamps, tax credits, income support...

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Tue Feb 24th, 2015 at 02:11:52 PM EST
[ Parent ]
See also:
Reform VAT policy, administration and enforcement. Robust efforts will be made to improve collection and fight evasion making full use of electronic means and other technological innovations.
[Public finance] Payment procedures will be modernised and accelerated while providing a higher degree of financial and budgetary flexibility and accountability for independent and/or regulatory entities.
* Devise and implement a strategy on the clearance of arrears, tax refunds and pension claims.
Establish a transparent, electronic, real time institutional framework for public tenders/procurement - re-establishing DIAVGEIA (a side-lined online public registry of activities relating to public procurement)
Improve swiftly, in agreement with the institutions, the legislation for repayments of tax and social security arrears
Step up enforcement methods and procedures, including the legal framework for collecting unpaid taxes and effectively implement collection tools
issuance of a Citizen Smart Card that can be used as an ID card, in the Health System, as well as for gaining access to the food stamp program etc


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 03:28:55 PM EST
[ Parent ]
It's not like Varoufakis doesn't play with open cards...

Can a Bitcoin-style virtual currency solve the Greek financial crisis? | Comment is free | The Guardian

If things go badly for Greece, finance minister Yanis Varoufakis has said he would consider creating a parallel digital currency, using Bitcoin's digital security and transparency, but doing the exact opposite of what the money fundamentalists intend.
by generic on Tue Feb 24th, 2015 at 03:51:09 PM EST
[ Parent ]
This reminds me of the old tally stick system in use up until the 19th century in the UK as well as in much of Europe during the middle ages. It also combines some of the features of Tax Anticipation Notes as advocated by Warren Mosler. Perhaps Greece could create enough Digital Euros to cover existing tax arrears. Even a fraction of that amount would constitute a serious stimulus when injected into the Greek economy. A further advantage is that this new money would be more likely to stay in Greece, where there is an assured use for it as payment of taxes.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 04:00:20 PM EST
[ Parent ]
But, to create electronic money, don't you first need electronics?
by Upstate NY on Wed Feb 25th, 2015 at 09:34:52 AM EST
[ Parent ]
the issuance of a Citizen Smart Card that can be used as an ID card, in the Health System, as well as for gaining access to the food stamp program etc.

It's in the program...

You hand out smart cards to the entire population. They are initially intended for accessing the health system, and for food stamps. Every citizen has an account created by the government. Retailers and health providers need terminals, obviously.

Then, some time later, ta-daa, you roll out Citizen Smart Card 2.0. It's the card you already have, but now you have an "Air Miles" account, with an initial free allocation on it. You can use your Air Miles to pay your tax. Retailers who accept food stamps will accept them for payment too, using them for their own tax liabilities, and exchanging them with other companies (all companies can have an Air Miles account too). Government income support would also be paid through the system, perhaps pensions...

Pretty quickly you have critical mass for a purely electronic currency -- I don't see any immediate need for physical scrip.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Wed Feb 25th, 2015 at 10:27:29 AM EST
[ Parent ]
And you need to wire up all stores anyway since you want to collect VAT effectively. Who can object to that.
by generic on Wed Feb 25th, 2015 at 10:38:19 AM EST
[ Parent ]
Can't wait to see the face of the Eurogroup chairman in June...

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 10:45:12 AM EST
[ Parent ]
Still this presupposes that they make it to June. They'll have to fight the notTroika every step of the way. Have they even gotten a single cent yet? Of course it doesn't get easier to provoke a crisis once the can is bouncing down the road and the ECB governing council will probably be less hostile to Greece in another rotation. When was the timing for those rotations decided anyway?
by generic on Wed Feb 25th, 2015 at 11:12:38 AM EST
[ Parent ]
Also we shouldn't forget that the Eurogroup's record of keeping to its commitments is less than stellar.
by generic on Wed Feb 25th, 2015 at 11:21:44 AM EST
[ Parent ]
The rotation was decided in September.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 11:27:35 AM EST
[ Parent ]
Democracy is great isn't it?
by generic on Wed Feb 25th, 2015 at 11:30:16 AM EST
[ Parent ]
Who says June says April. The first order of business is to get past the liquidity crunch in mid-March. But they can already start legislating and implementing parts of their program. It will be interesting to see which are the first parts of the agreement that they implement.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 11:29:32 AM EST
[ Parent ]
Or rather this:

BITCOIN: A flawed currency blueprint with a potentially useful application for the Eurozone | Yanis Varoufakis

BITCOIN: A flawed currency blueprint with a potentially useful application for the Eurozone
by generic on Tue Feb 24th, 2015 at 03:52:55 PM EST
[ Parent ]
I must say I don't remember reading this before. Which sadly doesn't men I didn't.

YV's FT coins are pretty different from the proposals for tax anticipation notes we had so far. First their face value is greater than 1 when held for a certain time and used to extinguish tax liabilities. Secondly they can be exchanged to € at will. Finally he envisioned people buying them on their own initiative.

On the face of it I don't really see the upside here. Since the Greece has only limited hard Euro funding there is some risk here of a bank run. Then there is the distributional effect of and opportunity cost for what amounts to a tax break for people with savings.

Still, it's a year old, not a complete proposal and he wasn't a minister at the time.

by generic on Tue Feb 24th, 2015 at 06:28:57 PM EST
[ Parent ]
But it constitutes a savings for any who use the currency 'at maturity' to pay taxes. Probably the financial sector, if this comes to pass, will find a way to have some sort of convertible instrument/swap that earns interest as euros and then is convertible back to its digital form to pay taxes. If so the 'loanable funds' nuts will be ecstatic, and, given that the ECB is not really a central bank and the Euro is not really a sovereign currency, this might actually be true for this case. It might increase 'loanable funds' from Greek banks. The Greek central bank might treat it differently than the ECB with regard to regulations. Others could say better than I.  

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Feb 25th, 2015 at 01:47:16 AM EST
[ Parent ]
...opportunity cost for what amounts to a tax break for people with savings.

For Greeks able to save or invest, with an interest in both activities, and a need to pay taxes, the Greek CB could structure these digital euros like one year treasury notes, accept them for 'repo' payable in another euro pegged non-interest bearing, domestic only currency which could be digital, and then say: "Look! Loanable funds!" This would then create, through further repo, a la Repo 101, additional loan capacity equal to the total of such initial 1% interest bearing bitcoins divided by the haircut. If some of this new money leaked out of Greece as payments for imports, so long as those accepting them clearly understood what they were, where is the harm to Greece? It would fix a lot, leave the hawks with another dilemma and provide another opportunity for the Eurogroup to show its revealed preference between Grexit and reasonable economic behavior. Were it working well in Greece by next fall it could become a major problem for EPP in the next election cycle.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Feb 25th, 2015 at 11:16:49 AM EST
[ Parent ]
Sounds pretty good to me. Lots of good structural reform stuff in there. If Syriza can manage to do even half of these things, they'll be the best Greek government in decades.

And that's without even mentioning their policies on fiscal issues.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Feb 25th, 2015 at 04:26:28 AM EST
[ Parent ]
Brussels signs off on Greek reform plan - FT.com

European Commission says deal should be approved

Brussels has determined Greece's reform plan is "sufficiently comprehensive" and should be approved by eurozone finance ministers, the clearest signal yet that Athens will secure an extension of its €172bn bailout beyond Saturday's expiry date.

According to two European Commission officials, the reform list -- which was received by Jeroen Dijsselbloem, chairman of the 19 eurozone finance ministers, "close to midnight" on Monday evening -- contained significant changes from a more vague outline originally discussed at the weekend.

"In the Commission's view, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review, as called for by the eurogroup at its last meeting," said one of the officials. "We are notably encouraged by the strong commitment to combat tax evasion and corruption."



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Tue Feb 24th, 2015 at 06:16:03 AM EST
Is this the real letter sent by syriza to the eurogroup or is it something you wrote according to your previous knowledge of their program?
by Xavier in Paris on Tue Feb 24th, 2015 at 06:31:05 AM EST
My post was based on an "unofficial" but valid press release by the PM's office. The full letter is indeed the one published above

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Tue Feb 24th, 2015 at 07:29:30 AM EST
[ Parent ]
thanks, great post by the way!
by Xavier in Paris on Tue Feb 24th, 2015 at 08:28:26 AM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 09:10:49 AM EST
European Commission: Letter by Vice-President Valdis Dombrovskis and Commissioner Pierre Moscovici to the President of the Eurogroup, Jeroen Dijsselbloem, on the Greek government's reform proposals (24 February 2015)
The Commission services have carefully reviewed the Greek government's reform proposals sent to you yesterday as President of the Eurogroup. This has been preceded by constructive exchanges over the week-end between the Greek authorities and representatives of the European Commission and the other institutions.

In the view of the Commission, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review as called for by the Eurogroup at its last meeting.

We are encouraged by the commitment to combat tax evasion and corruption, inter alia through efforts to modernise tax and custom administrations, as well as to pursue reforms to modernise the public administration. The Commission also notes the commitments in the area of statistics and considers it of vital importance that the institutional and operational independence of ELSTAT and its senior management be respected at all times.

Further specification of the reforms in these and other key areas is expected to be provided and agreed before the end of April, in line with last week's Eurogroup statement. The Commission looks forward to working with the new administration to elaborate what are at the moment still general commitments and transform these into clear policy actions.

The Commission underlines its willingness to continue to provide technical assistance in key areas to assist in the design and implementation of policies. As part of this process, the Commission underlines the importance of Greece fully respecting its commitment undertaken at the Eurogroup of 20 February 2015 to refrain from any roll back of measures and unilateral changes to the policies and structural reforms that would negatively impact fiscal targets, economic recovery or financial stability, as assessed by the institutions.

Determined and swift implementation of reform commitments will be key for a successful conclusion of the review.



A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 09:21:25 AM EST


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 09:33:31 AM EST
[ Parent ]
It always comes down to Labor market 'reform'! Because a Government can only pay its debt, if it makes it simpler for people in the private sector to be fired. It makes total sense.
by rz on Tue Feb 24th, 2015 at 09:38:02 AM EST
[ Parent ]
But it seams to be a done deal. I just read some twitter stuff that the Eurogroup has accepted. What I find interesting that in the end it is the IMF who objects. The IMF and Lagard have often been painted as the good guys. But from what I know Lagard buys 100% into Expansionary austerity. And the IMF might have a economics department which produces reasonable research but this has zero impact on the actual politics.
by rz on Tue Feb 24th, 2015 at 09:45:02 AM EST
[ Parent ]
The IMF and Lagard have often been painted as the good guys.

It's simply that the IMF isn't hung up about debt but about neo-lib 'reforms'.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Tue Feb 24th, 2015 at 11:15:12 AM EST
[ Parent ]
rz:
But from what I know Lagard buys 100% into Expansionary austerity.

Yes, while making occasional token mouth-noises to the contrary, I suppose to reassure attentive observers that she is not really as stupid as her actions suggest.

A bit like when sadists say 'This is going to hurt me more than it hurts you'.

Another well-coiffed confabulator of the first water...

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Tue Feb 24th, 2015 at 04:31:58 PM EST
[ Parent ]
Our initial impression is that the document covers a wide range of reform areas and in this sense, it is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review. However, as we expected it was not possible for the authorities to elaborate on concrete proposals and commitments that can be assessed by the institutions in respect to growth, public finances and financial stability. Given the very limited time a vailable, this is understand


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 10:19:11 AM EST
[ Parent ]
I replied to Whalen's tweet that it could mean the gov't should not balance the budget by neglecting to pay whole swaths of workers, as has been done over the last several years.

The previous gov't has also been in arrears to hospitals, pharmacies and utilities.

While these constitute debt and obligations for the state, use of such measures allowed them to achieve balanced budgets 2 or 3 years ago. I believe that most of the payments have been made to hospitals and utilities, not so sure about all workers.

by Upstate NY on Tue Feb 24th, 2015 at 02:00:49 PM EST
[ Parent ]
... Can we conclude from this that "the Troika" is indeed dead and buried?

Long live "the Institutions"!

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Tue Feb 24th, 2015 at 11:20:50 AM EST
[ Parent ]
Expanding on this inchoate reaction :

What are the consequences if the IMF says "hey this is not OK"?

  • Concretely, how much fresh money is the IMF scheduled to provide? What are the consequences if they walk away?

  • Or will their objections be overruled?

  • Or do they still have veto power? In which case, the "troika" is still in business, and the shit hits the fan.


It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Tue Feb 24th, 2015 at 01:47:38 PM EST
[ Parent ]
"What are the consequences if the IMF says "hey this is not OK"?"

They don't say that for the moment, but they reserve the right to do so in the next round of negotiations.

I don't know if the complete Lagarde letter has already been linked to on one of the different threads here, but here is the whole package of statements and letters as pdf in English and German for the Bundestag's information. Lagarde's letter is on page 20. She definitely still claims veto power.

by Katrin on Wed Feb 25th, 2015 at 04:49:52 AM EST
[ Parent ]
Does the 'next round' mean in four month?
by rz on Wed Feb 25th, 2015 at 04:52:14 AM EST
[ Parent ]
That's how I interpret the letter.
by Katrin on Wed Feb 25th, 2015 at 04:58:47 AM EST
[ Parent ]
Greece has to work out detailed plans by April which will be "approved" again, I am rather guessing that that's what is meant.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Feb 25th, 2015 at 11:10:08 AM EST
[ Parent ]
Link is broken.
by generic on Wed Feb 25th, 2015 at 05:11:05 AM EST
[ Parent ]
by Katrin on Wed Feb 25th, 2015 at 05:16:28 AM EST
[ Parent ]
Thank you.
by generic on Wed Feb 25th, 2015 at 05:25:40 AM EST
[ Parent ]
I find it highly interesting and positive that the letter from Draghi contains this:

"...the commitments outlined by the authorities (Greece) differ from existing programme material in a number of areas. In such cases, we will have to assess during the review whether measures which are not accepted by the authorities are replaced with measures of equal or better quality in terms of achieving the objectives of the program me."

To me this reads that Varoufakis even convinced Draghi to support the Syriza programme somewhat.

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Wed Feb 25th, 2015 at 06:13:54 AM EST
[ Parent ]
The Commission services have carefully reviewed the Greek government's reform proposals

LOL, it seems more like they rushed to set the tone by releasing their judgement first (and a good thing they did it before the IMF).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Tue Feb 24th, 2015 at 11:12:54 AM EST
[ Parent ]
The main thing I note is that this is a 4 month deal, and it contains enough ambiguous statements that most of the SYRIZA parliamentary team can give an OK to it (I think) AND pass from the Eurogroup. The SYRIZA government has gained precious and much needed time.

Otherwise I think it qualifies as the first small step back by the Europowers that be on their austerity offensive, and the first time in recent years that a Greek government manages to be the principal author (however constrained) of its own policies. In this light the Feb. 20 agreement acquires a different significance. Probably. Any thoughts?

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

by talos (mihalis at gmail dot com) on Tue Feb 24th, 2015 at 09:41:21 AM EST
Everybody wins. The Eurogroup got their face-saving extension of the program on Friday, and Syriza get their laundry list.

Hats off to Tsipras.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 10:20:17 AM EST
[ Parent ]
Does Schaüble win too? Because that would be a loss...

On the other hand, if Schaüble, having cried victory yesterday, proceeds to STFU today, then everybody wins.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Tue Feb 24th, 2015 at 11:27:47 AM EST
[ Parent ]
The latter.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 11:32:35 AM EST
[ Parent ]
Schäuble. Since the Eurogroup approval includes him, he is obviously included in "everybody wins".

Apart from an insult from Merkel this time ("the Greek government arrived in reality step-by-step"), so far I don't see any government spin reported in the German media, all they say is that Schäuble already requested the vote on the Bundestag approval. The conservatives in the Bavarian CSU agitate against approval, and so does CDU foreign policy "expert" (and all-around asshole) Wolfgang Bosbach who reportedly wants to leave government over its (for him not hawkish enough) Greece policy.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Tue Feb 24th, 2015 at 12:13:54 PM EST
[ Parent ]
Bosbach is suffering on cancer; perhaps hew just wants a great exit.
by IM on Tue Feb 24th, 2015 at 12:35:23 PM EST
[ Parent ]
Ugh... but I can't deny I laughed...

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue Feb 24th, 2015 at 12:45:09 PM EST
[ Parent ]
German MPs urged to take tough line on Greece - FT.com

An influential German business group is urging MPs to take a tough line on Greece ahead of a Friday vote in the Bundestag to approve an extension to the country's bailout.

The lower house of Germany's parliament is broadly expected to pass the four-month extension that eurozone finance ministers agreed with Athens on Tuesday.

Nonetheless, Chancellor Angela Merkel could face a sizeable rebellion within her Christian Democratic Union and its Bavarian sister party, the Christian Social Union. If nothing else, the warnings from the CDU's business caucus and other conservatives reflect widespread unease about providing additional support to a Greek government amid doubts about its reform pledges.

In a letter to lawmakers, Kurt Lauk, president of the CDU's Economic Council, wrote: "A simple extension of the aid programme without effective terms would mean that we are knowingly throwing further good money after bad."

The council, an association representing business interests, is a longstanding critic of eurozone bailouts. It argues that rescues create moral hazard for governments that mismanage their economies.



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Wed Feb 25th, 2015 at 11:38:29 AM EST
[ Parent ]
If the Bundestag wants to blow up the Eurozone, they can go right ahead.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 11:45:47 AM EST
[ Parent ]
I doubt that. Backbenchers having their day in the sun. Nothing more.
by IM on Wed Feb 25th, 2015 at 11:56:48 AM EST
[ Parent ]
well, 29 or so voting against isn't nothing. Still overall the usual backbencher posturing.
by IM on Fri Feb 27th, 2015 at 01:59:02 PM EST
[ Parent ]
That depends on if they believe their own spin of the lazy Greeks spiriting away our money or not. I don't believe that the coalition won't get enough votes, though. Their majority is large enough.
by Katrin on Wed Feb 25th, 2015 at 12:18:48 PM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 12:26:47 PM EST
[ Parent ]
So now we learn that public TV had to be closed when IMF bureaucrat Poul Thomsen blackmailed the minister for the reform of public service, Antonis Manitakis, to immediately fire 4,000 additional public servants, just to scare those remaining, claims Manitakis. So this is what the current government must avoid, given Lagarde's indication of continuing to play hardball. Another IMF bureaucrat advised the Greek government to bring no lawsuits against any of those on the Lagarde list of tax cheats. As for the minimum wage reduction to a level opposed even by the employers, the blackmailers enforcing it aren't identified beyond "reviewers of the Eurogroup".

The article also says, citing a dissident IMF official from Brazil, that the IMF couldn't have participated in the bailout by its own rules until DSK changed them (though once the rule was changed, there was majority support for the bailout).

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Wed Feb 25th, 2015 at 01:16:00 PM EST
[ Parent ]
These are all points made in the film I saw last night :

Puissante et incontrôlée : la troïka (French version)

Macht ohne Kontrolle, Die Troika (German version)

... ah. I see the film's researchers are credited in the article :
Eurokrise: Die wirtschaftlichen Eliten bleiben verschont | ZEIT ONLINE

Mitarbeit: N. Leontopoulos, E. Simantke Dieser Bericht beruht auf Recherchen für den Film "Macht ohne Kontrolle - die Troika" von Harald Schumann und Arpad Bondy, der am Dienstag Abend bei Arte gesendet wurde und noch in der Mediathek abrufbar ist.


It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Wed Feb 25th, 2015 at 01:51:36 PM EST
[ Parent ]
Not just credited, the article was written by Harald Schumann.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Feb 25th, 2015 at 02:36:07 PM EST
[ Parent ]
So now we learn that public TV had to be closed when IMF bureaucrat Poul Thomsen blackmailed the minister for the reform of public service, Antonis Manitakis, to immediately fire 4,000 additional public servants, just to scare those remaining, claims Manitakis. So this is what the current government must avoid, given Lagarde's indication of continuing to play hardball.

NO! It needs to be publicly challenged for the overt political intervention that it is - stifling diversity of opinion in broadcast media. Another bluff to call. Make this early and high profile. If need be the only of her red lines crossed at the time.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Feb 25th, 2015 at 02:49:26 PM EST
[ Parent ]
Though I wonder when the charade will end? Another five years? Sometime in the 2020s when presumably von der Leyen or Kramp-Karrenbauer will have to clean up that mess? This "Insolvenzverschleppung" ("fraudulent trading due to balance sheet insolvency" in English) is just a political nuke waiting to explode. The only chance for survival is to enter into a mutually agreeable  debt restructuring that can be favorably obfuscated so that Eurozone creditors don't face the wrath of [a majority] their populace. But common sense has been having a hard time. Why should it be different now?

Schengen is toast!
by epochepoque on Wed Feb 25th, 2015 at 03:07:54 PM EST
[ Parent ]
"In a letter to lawmakers, Kurt Lauk, president of the CDU's Economic Council,"

As things stand right now, the CDU's business council is at the nadir of it's influence. Lauk is hardly a power broker.

by IM on Wed Feb 25th, 2015 at 11:58:09 AM EST
[ Parent ]
As Migeru said, hats off.

However, I am curious whether there was an official or semi-official reply to Manolis Glezos.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Tue Feb 24th, 2015 at 10:42:06 AM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 10:44:51 AM EST
[ Parent ]
I am amazed at how much of the Thessaloniki program they got into what was just passed.

The remaining problem is that they can't do expansionary fiscal policies, which everybody and Greece in particular would need. But hey, for a four month period it is not a bad program at all, and it gives much more time to plan the next step.

As I see it, Greece called the Eurogroups bluff and won.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Tue Feb 24th, 2015 at 10:49:48 AM EST
[ Parent ]
Greece called the Eurogroups bluff and won.

That is my take also. I have been hoping for this and, since the 20th, predicting it. Either way, Grexit or not, the Greek people will benefit and the 'austerians' loose, along with EPP politics. This cannot but encourage Podemos, who, when they win, will kill TINA for good. It is by no means over, but is at last headed in the right direction. Two little slices and now a big slice off of the baloney that is 'austerity' and TINA.


"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 12:30:59 PM EST
[ Parent ]
I am not so optimistic. While it may help Podemos, for the Greeks, the EU already offered them an extension until June.

The teeth will come out then, because they will be able to say, "We gave you time to do something." In reality, there is not enough time at all.

If the program comes back in June, then there will not be a significant difference.

by Upstate NY on Tue Feb 24th, 2015 at 01:55:14 PM EST
[ Parent ]
Greece will be/should be better prepared for exiting the Euro, if nothing else.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 02:00:16 PM EST
[ Parent ]
Agreed. Unfortunate that they didn't exit in 2010. They should have.

But if Greece could be fixed in 3 or 4 months, it would have already been done.

Greece could have been fixed in the short term by simply stopping corruption at the top, but the necessity of that can't be proven in a mere semester.

by Upstate NY on Tue Feb 24th, 2015 at 02:12:44 PM EST
[ Parent ]
I can only hope that the new government proceeds aggressively with corruption investigations. Especially sweet would be to find something deserving of serious prosecution involving someone who is also an important donor to the current German govenment.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 02:53:55 PM EST
[ Parent ]
Well, there is the fact that Germany refuses to extradite the former head of the Siemens Greek division, even though he is a Greek national.
by Upstate NY on Tue Feb 24th, 2015 at 03:00:37 PM EST
[ Parent ]
Tsipras should raise press issue in the Eurogroup, EC and have parliamentarians do it in the EP. I doubt he is the only likely perp.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 03:07:10 PM EST
[ Parent ]
He's not. There's a list of about 30 of them. But I though that the German courts had ruled that they had managed to drag it out for so long that the statute of limitations applied.
by gk (gk (gk quattro due due sette @gmail.com)) on Tue Feb 24th, 2015 at 03:25:19 PM EST
[ Parent ]
International Court of Justice?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Feb 25th, 2015 at 10:25:47 AM EST
[ Parent ]
I don't know whether "called their bluff" is the right metaphor. But I think that Greece came to this conflict with one (possibly unspoken) threat to back their position: if the door was shut in their face, they would leave.

Not only would Grexit create considerable shockwaves on financial and currency markets, but the (likely) modified relations of Greece with Russia, at a time when Turkey also shows signs of increased entente with Russia and the abandonment of EU ambitions, while the Balkans are far from entirely stabilised and Ukraine...

Whatever Schäuble and his ministry wanted, Auntie Angela has this big problem of getting out of the Ukraine mess without it blowing up in her face. I think she may well be more concerned with that at the moment, than the defence of orthodoxy wrt Greece.

by afew (afew(a in a circle)eurotrib_dot_com) on Tue Feb 24th, 2015 at 02:17:33 PM EST
[ Parent ]
As I said, Schauble didn't blink. Merkel put her hand over his face.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 02:56:02 PM EST
[ Parent ]
Come June Greece can simply insist on being able to implement serious fiscal stimulus as part of its program. Let the Eurogroup hawks seek to destroy its banking system, with a back up in place, and let them try to force it to abandon the Euro, but make the whole process as painful to the financial sector and as damaging to Germany and the other hawks as possible. Litigate, litigate, litigate, but proceed. What do they have to lose?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 24th, 2015 at 03:41:00 PM EST
[ Parent ]
If we look at the whole process, yes.

However, last week the eurogroup looked ready to play hardball, and then they accept this program which is much better then what sounded accetable to the eurogroup last week.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Feb 25th, 2015 at 05:13:38 AM EST
[ Parent ]
Varoufakis still has his work cut for him balancing the books, though.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 05:24:54 AM EST
[ Parent ]
If there are actual books to balance, that would be a bonus.
by Upstate NY on Wed Feb 25th, 2015 at 09:33:57 AM EST
[ Parent ]
And if there are not what does that say about the 'oversight' of the Troika?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Feb 26th, 2015 at 04:01:05 PM EST
[ Parent ]
The Troika doesn't have oversight.

The Troika is the oversight.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Feb 26th, 2015 at 04:55:46 PM EST
[ Parent ]
Guess it would mean "The Troika don't need no stinkin books!"

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Feb 26th, 2015 at 05:49:42 PM EST
[ Parent ]
The revealed preference was to accommodate. The rhetoric was to force a choice by Greece, the actual consequences of which even Merkel was unwilling to test. Blinked.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Feb 25th, 2015 at 12:49:22 PM EST
[ Parent ]
talos:
Otherwise I think it qualifies as the first small step back by the Europowers that be on their austerity offensive

It is a fissure, however symbolic. Better than nothing. For the Troika better than Grexit or Gritcoin, for Syriza better than an outright 'NO'.

Considering how much the financial house of cards world depends on 'confidence' even a small symbolic fissure can be important.

Butterfly >> hurricane etc.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Tue Feb 24th, 2015 at 04:42:18 PM EST
[ Parent ]
Eurozone approves Greek reform proposal - FT.com

The eurozone's 19 finance ministers have approved the Greek government's six-page list of reforms, clearing one of the last hurdles to extending its €172bn bailout for another four months, according to an EU official.

The approval, which came in a teleconference between the ministers and representatives of the three institutions that monitor Greece's rescue programme, shifts the debate of the Greek programme to national capitals, where several eurozone parliaments must approve the extension before the week's end.

The most crucial approval will be that of the German Bundestag, where there remains strong scepticism about the new Greek government's ability to meet the programme's reform requirements.

Parliamentarians from Chancellor Angela Merkel's party - the Christian Democratic Union and its Bavarian sister party, the Christian Social Union - were to meet on Tuesday afternoon with Wolfgang Schäuble, the German finance minister, to discuss the Greek extension.



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Tue Feb 24th, 2015 at 10:40:18 AM EST
Lapavitsas' letter against Friday's agreement:

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Feb 24th, 2015 at 11:48:45 AM EST
The Eurogroup let this passage through?
Establish a closer link between pension contributions and income, streamline benefits, strengthen incentives to declare paid work, and provide targeted assistance to employees between 50 and 65, including through a Guaranteed Basic Income scheme, so as to eliminate the social and political pressure for early retirement which over-burdens the pension funds.
by gk (gk (gk quattro due due sette @gmail.com)) on Tue Feb 24th, 2015 at 03:39:16 PM EST
Given the disastrous social reality in Greece, it's hard to find humor or even acceptable satire in this Spiegel Spass.

Title: Eurogroup agrees to Reform Plans; Lucky Greece

V:  Good that our letter was accepted.
Tsipras: And, old man, it was our last stamp.

Perhaps its because i still can't pay my electric bill, with the power going off tomorrow unless the Goldman Sachs project payment comes quickly. (the lovely mafia utility SWB has already given me 3 weeks past the 1st shutoff date, and today they said no further. I reminded them what happens to medicine and remaining food, but they said that no longer mattered. I did tell them that's what Schäuble has done to Greece, which went over like a lead balloon. lead balloon, get it?)


"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Wed Feb 25th, 2015 at 06:03:17 AM EST
Well, Goldman Sachs didn't get where they are today by paying contractors on time.

Perhaps you could sell them your debt to SWB?

Goldman Seeks to Raise Fund to Buy Energy Sector Debt - NYTimes.com

Goldman Sachs is seeking to raise capital from wealthy individuals and other investors for a new fund to invest in the debt of troubled companies in the energy sector, according to confidential marketing materials obtained by DealBook.

The fund, being raised by Goldman's asset-management business, will invest mostly in high-yield corporate credit, the document shows. Known as the Energy Investment Opportunities Fund, it will also buy investment-grade credit and secured bank loans.



It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Wed Feb 25th, 2015 at 06:51:48 AM EST
[ Parent ]
Reading the Greek Deal Correctly | Common Dreams | Breaking News & Views for the Progressive Community

To understand the issues actually at stake between Greece and Europe, you have to dig a little into the infamous "Memorandum of Understanding" signed by the previous Greek governments. A first point: not everything in that paper is unreasonable. Much merely reflects EU laws and regulations. Provisions relating to tax administration, tax evasion, corruption, and modernization of public administration are, broadly, good policy and supported by SYRIZA. So it was not difficult for the new Greek government to state adherence to "seventy percent" of the memorandum.

The remaining "thirty percent" fell mainly into three areas: fiscal targets, fire-sale privatizations and labor-law changes. The fiscal target of a 4.5 percent "primary surplus" was a dog as everyone would admit in private. The new government does not oppose privatizations per se; it opposes those that set up price-gouging private monopolies and it opposes fire sales that fail to bring in much money. Labor law reform is a more basic disagreement - but the position of the Greek government is in line with ILO standards, and that of the "programme" was not. These matters will now be discussed. The fiscal target is now history, and the Greeks agreed to refrain from "unilateral" measures only for the four-month period during which they will be seeking agreement.

Cassidy acknowledges some of this, but then minimizes it, with the comment that the deal "seems to rule out any large-scale embrace of Keynesian stimulus policies." In what document does any such promise exist? There is no money in Greece; the government is bankrupt. Large-scale Keynesian policies were never on the table as they would necessarily imply exit - an expansionary policy in a new currency, with all the usual dangers. Inside the Euro, investment funds have to come from better tax collection, or from the outside, including private investors and the European Investment Bank. Cassidy's comment seems to have been pulled from the air.

Tidy job deconstructing the MSM narrative.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Wed Feb 25th, 2015 at 07:05:13 AM EST
It would have to be via a new complementary internal currency or equivalent that expansionary programs would be undertaken. The domestic electronic payment system will serve that purpose if it even just provides supplementary income to older workers, as would the re-purposed bit coin about which Varoufakis wrote.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Feb 26th, 2015 at 04:25:09 PM EST
[ Parent ]
Golden Dawn and the "Dark Forces" | Jacobin

hange is in the air in Athens. We have felt it. This past November we were guests at a workshop attended by Greek and foreign academics and politicians, police union representatives, current and retired Hellenic Police officers (including high-ranking ones), and Syriza's members of parliament and central committee representatives. A meeting of the radical left and the police: it was unprecedented.

The discussions were remarkably candid. Reform -- radical reform -- of the police and the judiciary was on everyone's mind. The energy inside the workshop was matched only by the mood on the street. Hope abounded. Change seemed imminent.

Yet despite this momentum, a dark cloud hung over Athens. The police, of course, remained a conservative enclave. They harbored xenophobic attitudes and, in far too many cases, openly aligned with the far right. Last month, as Syriza was being propelled to power, the police once again voted heavily in favor of the fascist Golden Dawn party.

Greek Finance Minister Yanis Varoufakis has pledged to "smash" the country's oligarchs. But can Syriza do so without taming the police?

Varoufakis knows firsthand how difficult this task will be. After he assisted journalists investigating various banking scandals in his previous position as economics professor at the University of Athens, he received an ominous phone call. "A stranger asked me whether my son had already come home," he recently told the German newspaper Stern. "The caller then described the route my son had taken and said: if you want him to come home safely in the future, then stop investigating the banking business."



'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Wed Feb 25th, 2015 at 08:08:27 AM EST
Ex-Greek minister on trial over HSBC accounts - FT.com

Former Greek finance minister George Papaconstantinou went on trial on Wednesday charged with removing relatives from a list of Greeks allegedly holding accounts at HSBC's Swiss private bank.

Mr Papaconstantinou denies that in 2010, while finance minister, he tampered with a USB memory stick containing a list of 2,000 HSBC accounts held by alleged tax evaders.



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Wed Feb 25th, 2015 at 11:43:58 AM EST
Ex-Greek minister on trial over HSBC accounts - FT.com
Mr Papantoniou, who steered Greece into the euro as finance minister was sentenced to four years in jail last November but was allowed to buy off his term for €14,500

I missed that.  How much for a murder?

On the other hand... the new government might manage to raise a lot of money, if they revise the price schedule.
Tax fraud : 100 years in prison, or one million euros per year...

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Wed Feb 25th, 2015 at 12:31:58 PM EST
[ Parent ]
"On 14 January 2014, a court in Munich ruled that Ecclestone would indeed be tried on bribery charges in Germany,[54] and on 5 August 2014, the same court ruled that Ecclestone can pay a £60m settlement, without admitting guilt, to end the trial"

A travesty of justice, but quite lucrative.

http://en.wikipedia.org/wiki/Bernie_Ecclestone#Bribery_accusation

by IM on Wed Feb 25th, 2015 at 12:53:36 PM EST
[ Parent ]
Has anyone seen the interview with Varoufakis in the new issue of CH? I don't know if it's a real interview or not.

Spiegel Hier

He says (on medicine in the Middle Ages): ""At that time venesection (bleeding) was prescribed, which made the sick often more ill, after which they were again allowed to bleed."

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Wed Feb 25th, 2015 at 01:17:53 PM EST
It is real all right.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 05:35:22 PM EST
[ Parent ]
I'm not astonished that Schäuble thinks he can get away with it. I'm astonished that the public allows him to.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 05:33:58 AM EST
[ Parent ]
Part of the whole program Greece is currently operating under states Greece will receive a writedown (not a restructuring) when it achieves a primary surplus.
by Upstate NY on Thu Feb 26th, 2015 at 09:28:33 AM EST
[ Parent ]
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Feb 26th, 2015 at 05:42:27 AM EST
[ Parent ]
The Mischief that the Troika brought - Harald Schumann - Zeit
It blackmailed ministers, fashioned itself as a legislator, and conspired with the elites. This is how the Troika knowingly pushed the crisis states into recession.

... Later on, the controllers of the IMF said that the effects of the austerity program had been underestimated because Thomsen and his EU colleagues had used wrong assumptions. But that wasn't quite true. They knew what they were doing. In March 2010 the IWF's representative in Athens wrote in a "secret" report: if the EU's austerity program were to be implemented, "it would cause a sharp contraction of internal demand and a deep recession that would put the social compact under heavy strain." And that's exactly what happened.

This article is a digest of a documentary that was aired yesterday on ARTE. It's available till next Tuesday. If you understand German or French this might be a good way to get your blood boiling (French version here).

Schengen is toast!
by epochepoque on Wed Feb 25th, 2015 at 02:05:03 PM EST
Also discussed upthread.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Feb 25th, 2015 at 02:36:59 PM EST
[ Parent ]
ah yes, didnt see that.

Schengen is toast!
by epochepoque on Wed Feb 25th, 2015 at 02:53:53 PM EST
[ Parent ]
I think it is important to establish who is the bad guy and who is the really bad guy in the negotiation with Greece.

I found this comment by dsquared in a thread at  Crooked Timber very interesting:

I don't agree with much of this, as you'd expect, but I'm on a mobile device at the moment so everyone is spared my grumbling and moidering. Just one point though ; the IMF and ECB have both put out statements saying that the Greek proposal doesn't go far enough in terms of reforms. So the compromising was definitely done within the allegedly recalcitrant Eurogroup, rather than under pressure from other troika members. The "€group bad austerians / IMF good Keynsians" framing never convinced me but now it's provably wrong. Either Schaeuble gave ground under pressure from the rest of the €group, or he's never been as inflexible as he's been painted.

Also, the people saying that Greece has a lot of freedom within the fiscal targets are wrong, or at least taking a very optimistic reading. The actual agreement (this wasn't emphasised at the press conference) was that they wouldn't take any unilateral measures which jeopardised 1) the fiscal targets 2) the economic recovery or 3) financial stability. To me, that gives the troika a heck of a lot of leeway to reject Greek policies.

But in general I don't think it's productive to do the "who blinked" bit. It was a sensible compromise. Both sides gave up some real red lines.

by rz on Wed Feb 25th, 2015 at 02:49:15 PM EST
I think this gives too little credit to the way the Greeks played the different sides of the Troika off against each other.

By negotiating directly with the Eurogroup, rather than the Troika as a whole, they managed to leave the IMF and ECB outside the room where the deal-making happened. As it turns out, the Troika couldn't maintain internal discipline: The party actually present at the table disproportionately gave concessions on areas valued by the parties not at the table.

What surprises me is that the Troika allowed their interlocutors to split their coalition like that. Because that is a rookie mistake. I'm starting to think the Eurogroup might actually be an amateur night clown parade that has managed on bluff, bluster and congenial local oligarchs up to this point, rather than any real talent or aptitude for serious negotiation.

That is potentially very, very good news for everyone involved. (Well, except the Bundesbank, but fuck the Bundesbank.)

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Feb 25th, 2015 at 05:39:21 PM EST
[ Parent ]
I'm starting to think the Eurogroup might actually be an amateur night clown parade that has managed on bluff, bluster and congenial local oligarchs up to this point, rather than any real talent or aptitude for serious negotiation.
Well, duh.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Feb 25th, 2015 at 05:51:31 PM EST
[ Parent ]
No, that's not a given. You would expect people like finance ministers to be very, very good at negotiation, and a complete clown parade on the macroeconomic substance.

This indicates (if my tea-leaf reading is correct) that the Eurozone FinMins are incompetent in their core competency, politics. Not just in some ancillary nice-to-have skill set, like policy.

I think that is surprising.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Feb 25th, 2015 at 05:55:43 PM EST
[ Parent ]
And I think you are speculating on the basis of a too positive interpretation. I don't think there is a serious disagreement between the Troika (Lagarde was present at the Eurogroup talks anyway), instead, they are already setting the tone for further demands in April.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed Feb 25th, 2015 at 06:01:00 PM EST
[ Parent ]
The division might have been more on tactical grounds than on substance. Schäuble and the Spaniards wanted to smash Greece down immediately and publicly. The IMF doesn't care as long as the working class is crushed and the looting continues and mostly takes orders from the Americans anyway. The ECB council probably acts like an extension of the states so tended toward the immediate crushing side. No idea what Draghi thinks. Can he write assessments on his own or does he need approval? The Americans want this to go away before it gets in the way of their pissing match with the Russians.
The only one sorta reliable in the Greek corner seems to be Junker, presumably to spite Angela, but while both the Moscovici draft and the Commission being the first one out of the gate with their assessment helped immensely he has no money.

Looking at the people standing at the sidelines we have the European Social Democrats doing their usual thing, most leftists seeing Tony Blair behind every boulder (and who can blame them?), Putin trolling a bit as is his wont and the press foaming.

Most lynch mobs are somewhat disorganised.

by generic on Wed Feb 25th, 2015 at 07:06:50 PM EST
[ Parent ]
generic:
Schäuble and the Spaniards wanted to smash Greece down immediately and publicly. The IMF doesn't care as long as the working class is crushed and the looting continues

Michael Hudson agrees:

Greek Finance Minister Varoufakis Wants Austerity ... for the Rich - Truthdig

Remember a few years ago when Europe said, Greece owes 50 billion euros in foreign debt? Well, it turned out that the central bank had given to the Greek parties a list called the Lagarde list (for Christine Lagarde, head of the IMF) of all of the tax dodgers, Greek tax dodgers who had Swiss bank accounts. Well, the Swiss bank accounts that the tax dodgers had ended up to about 50 billion euros. So Greece could pay off the debt that it's borrowed simply by moving against the tax dodgers.

But, of course, this would be at the expense of the Swiss banks and the other banks. So in effect the banks would be paying themselves. And they don't want to pay themselves. They want to squeeze it out of labor and let the tax dodgers and the Greek tycoons succeed in stealing the money from the government. So, in effect, the troika--not the troika, the finance ministers, really, are backing the tax dodgers and the crooks in Greece that SYRIZA is trying to move against, whereas the IMF is actually, for once, taking a softer position towards the whole thing. And even President Obama has chimed in by apparently calling German Prime Minister Merkel and saying, look, you can't just push austerity beyond the point, because you're going to push them out of the euro, and you'll push them out of the euro on SYRIZA's terms, where SYRIZA can then turn to the Greek population and say, wait a minute, we did what we promised here. We stopped the austerity. We didn't withdraw from the euro; we were driven out as part of the class war.

PERIES: Michael, earlier you were also making an analogy between what's going on in Greece and what happened to Cuba [crosstalk]

HUDSON: Cuba under Castro had an alternative social system. He wanted to spread the wealth around (it was a Marxist system) in his way. He wanted to get rid of really the crooks around Batista who were running the country, the rich who didn't pay taxes, and he wanted to have a social revolution there. So the American government said, wait a minute, if Cuba succeeds, then they're going to be a revolution all throughout Latin America. Latin Americans can realize, wait a minute, we can take over the American sugar companies there, we can take over the American banana companies there, we can make the rich pay the taxes and the corporations pay the taxes and the exporters pay the taxes, not simply the labor. We can unionize labor, we can educate it, and if Cuba can educate labor, that would be a disaster for the neoliberal plan, because if labor's educated and has a program, then it'll realize that there is an alternative to Thatcherism.



'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Wed Feb 25th, 2015 at 07:28:20 PM EST
[ Parent ]
...the central bank had given to the Greek parties a list called the Lagarde list (for Christine Lagarde, head of the IMF)...

...So, in effect, the troika--not the troika, the finance ministers, really, are backing the tax dodgers and the crooks in Greece that SYRIZA is trying to move against, whereas the IMF is actually, for once, taking a softer position towards the whole thing...

To clear up his misunderstanding: when the Lagarde list was born in 2010, Lagarde was still the finance minister of France, not yet the head of the IMF. So the list wasn't a sign of the IMF's softness at all; and, as told in the Die Zeit article discussed upthread, it was just the IMF's bureaucrats who advised the Greek government against bringing charges against the tax cheats.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Feb 26th, 2015 at 05:38:34 AM EST
[ Parent ]
I found he myth of "good" IMF perplexing anyway. They also take much higher interest rates.
by IM on Thu Feb 26th, 2015 at 06:41:38 AM EST
[ Parent ]
I think the reason is that its research division produces papers showing that the IMF's policies can not achieve its stated goals. That this had no influence on the policies is something that is easily missed.
by generic on Thu Feb 26th, 2015 at 06:45:51 AM EST
[ Parent ]
Another reason is that the EU (ECB, Council, Commission) public discussion focused on debt service and budget cuts rather than the substance of the "reforms" enforced at gunpoint, and not just the IMF research division but the IMF top leadership was more flexible on that. Then again, Poul Thomsen and his fellow IMF bureaucrats would never have been able to exert the level of influence they have without the perpetuation of the depression by the austerians, so making the IMF worse than the others is wrong too.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu Feb 26th, 2015 at 07:03:52 AM EST
[ Parent ]
Another reason is that the EU (ECB, Council, Commission) public discussion focused on debt service and budget cuts rather than the substance of the "reforms" enforced at gunpoint, and not just the IMF research division but the IMF top leadership was more flexible on that.

This may be the reason why IMF was left out. Finance ministers fear debt cuts because they don't want to sell them to voters while compromizing on "reforms" won't cost them anything. Not having IMF in let them choose whether to compromize on debt or on reforms.

by Jute on Thu Feb 26th, 2015 at 11:43:41 AM EST
[ Parent ]
Greece's fate: In Angela Merkel's hands? - Fortune
For Galbraith, the lack of coordination on the European side was shocking. "I'm an old Congressional staffer," he says. "To watch an official body function in this slipshod and ad hoc way, to watch the Eurogroup and the way things were done, was really a revelation."
by generic on Wed Feb 25th, 2015 at 06:03:03 PM EST
[ Parent ]
They encountered the first contrarian test, real tense negotiations in years.
by das monde on Wed Feb 25th, 2015 at 06:28:41 PM EST
[ Parent ]
Dijsselbloem has always seemed to me to be a complete idiot when it comes to the business of actually negotiating an agreement whilst I was impressed by Tspiras and Varoufakis intellectual skills if unsure about their negotiating prowess. I would characterize the outcome as an away draw for the Greeks, with the return leg to be fought on territory Syriza will be more comfortable with - the actual implementation of practical measures to improve tax collection and economic growth.

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Feb 25th, 2015 at 07:16:11 PM EST
[ Parent ]
I was impressed by Tspiras and Varoufakis intellectual skills if unsure about their negotiating prowess

I beg to disagree. It was guerilla warfare and the way Varoufakis used the press was brilliant. A thousand ambushes where you kill two at a time and the run away. You can't afford to lose two as well. To others it seems like tou retreated, hence a loss, when in fact over the long run attrition takes a bigger toll on the other side.
On the other hand, Tsipras stayed in the shadows and lo and behold, a 40yr old untested politician gained statesman status in the eyes of his people and many others.

by Euroliberal on Thu Feb 26th, 2015 at 04:17:31 AM EST
[ Parent ]
Varoufakis certainly seemed to nonplus Dijsselbloem et al.  But negotiating prowess is all about building up relationships over the longer term - not just a few quick wins gained by guerrilla tactics. In the longer term they will be waiting for him in the long grass if he has made any enemies. The next phase is about building trust, not ambushing people.

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Feb 26th, 2015 at 04:27:02 AM EST
[ Parent ]
The next phase is about building trust, not ambushing people.
Which is why
The next phase is about building trust, not ambushing people.
Right.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 04:56:00 AM EST
[ Parent ]
I'm not sure I understand this post

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Feb 26th, 2015 at 11:43:45 AM EST
[ Parent ]
Of course not, I meant
The next phase is about building trust, not ambushing people.
because
In the longer term they will be waiting for him in the long grass if he has made any enemies.


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 11:51:46 AM EST
[ Parent ]
The problem is that Greece has been negotiating for 5 years already. And losing. They have never taken to the press.

Whereas the press has received thousands of leaks about the negotiations from the Eurogroup.

Also, the person who was most in charge in those years, Yanis Stournaras (though he belongs to another party) is actually close friends with people like Varoufakis. They are academic colleagues in the same department. Even better, Stournaras actually gave Varoufakis his first job out of his advanced degree.

In other words, Varoufakis had inside information about the actual fault lines.

Greece had played things under the vest for 5 years. Going public with your arguments was the exact thing that put fear into the Eurogroup, it was something out of their control.

I don't actually believe Schauble revels in his image, and his uncharacteristic schaudenfreude of the last week (which was weird, since the Greek public really approves of Syriza) was a sign that the public battles were evidently making a difference.

by Upstate NY on Thu Feb 26th, 2015 at 09:25:01 AM EST
[ Parent ]
It seems to me that Schäuble is Merkel's designated attack dog. She called him off at the end, to enable an agreement to be signed. If that's the case, he has played the role with remarkable abnegation.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Thu Feb 26th, 2015 at 09:28:02 AM EST
[ Parent ]
I don't know the German political scene at all, but I could imagine there being acute embarrassment, even in conservative circles, at being seen as the enforcers of Greek impoverishment.  The whole point of austerenomics is to be at one remove from the real action - with local todies carrying the blame - and when Varoufakis went public, they knew that game was up.

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Feb 26th, 2015 at 11:42:09 AM EST
[ Parent ]
The Greek government has a huge advantage in that they are complete outsiders. Insurgents who have come from nowhere, ill-dressed and ill-mannered, and who don't feel constrained by the rules.

I feel that they have been remarkably disciplined in not publicly dissing previous governments who got Greece into its current pickle. This is no doubt important for the home audience, and of course because it won't get them any credit in negotiations. Still, it must be hard. However, their interlocutors have seemed surprised (or have faked surprise) at the fact that they should dare to repudiate elements contractualised with their predecessors.

A new generation of Euro politicians... let's hope there are more coming.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Thu Feb 26th, 2015 at 12:00:47 PM EST
[ Parent ]
The point about the EU elite being used to operating through leaks and being thrown off by Varoufakis going public was also made by Paul Mason last week: Leak and counter-leak: how not to achieve a Greek deal.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 09:47:39 AM EST
[ Parent ]
In the longer term they will be waiting for him in the long grass if he has made any enemies. The next phase is about building trust, not ambushing people.

Varoufakis needs tactical victories right here, right now, or he won't have any "long term" to worry about.

In the long term, Greece can afford to have Varoufakis take the fall for their guerrilla tactics, as long as he wins enough fights first.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Feb 26th, 2015 at 05:34:38 PM EST
[ Parent ]
You would expect people like finance ministers to be very, very good at negotiation

I wouldn't. Most countries are like the UK - ministers get jobs as rewards for party loyalty, not because of any obvious competence.

In the British system, you're expected to become an instant expert on transport, or health, or the entire economy, or even on being Prime Minister, even though you have no experience and no relevant qualifications - except knowing how to shout a bit, score cheap points in a debate, and perhaps collect cash as a 'consultant.'

So, farce it is.

The socially-aware post-war consensus was a brief exception to the usual endemic and virulent greed that has run Europe's politics since the Middle Ages, and US politics since before the War of Independence.

It's not actually a surprise that most policy makes no sense, and appears to be chosen for the immediate personal gain of the policy authors - because that's exactly what's happening.

The terrifying thing about Varoufakis and Tsipras is that they don't seem to be like this. This must absolutely enrage the IMF, etc, because they're having to deal with people who not only have professor-level insight and experience, but also come equipped with moral principles that aren't bounded by simple reptilian greed.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Feb 25th, 2015 at 07:30:04 PM EST
[ Parent ]
I don't know the precise situation in other European countries, but the cabinet making process in Ireland and (I think) the UK is an absolute joke. Over a matter of a few hours the prime Minister designate calls in the favoured parliamentarians and tells them he is making them minister for such and such. The actual portfolio allocated may have no bearing on actual prior knowledge, experience, or stated preferences.  It often is explicitly not the brief the relevant parliamentarian covered in opposition - lest his/her statements in opposition might come to haunt him as Minister.  Sometimes some appointee has a hissy fit regarding their allocated portfolio and a hasty re-shuffle ensues.

The whole process ensures most ministers, however able, are almost complete novices in their newly allocated policy area and are the easy sitting ducks for experienced civil servants who have spent a lifetime in that area and who can easily browbeat their Minister into their preferred policy positions.  By the time the Minister becomes sufficiently proficient in a policy area to challenge his/her civil servants, they are reshuffled to a new portfolio...

And so the veneer of democracy is maintained whilst the real Government is carried out by career civil servants with very privileged pay and pensions provisions that are higher than in the rest of Europe.  Sometimes they even sabotage a Minister who is proving "difficult" with wrong, partial, or downright mis-information.  Because of the the archaic tradition that Ministers are responsible for everything that happens in their department, it is the Minister who must fall on his sword whilst the Civil servants smile in the background.  Not that there is much of a tradition of Irish Ministers falling on their swords no matter how egregrious their mistakes...

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Feb 26th, 2015 at 12:02:22 PM EST
[ Parent ]
You would expect most ministers to be party political animals, adept at survival, backstabbing and passing the buck. Just look at how Merkel survives by not opening her mouth until the last moment, and how she (and the entire EU neighbourhood policy apparatus) completely fucked up on Ukraine.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 05:01:08 AM EST
[ Parent ]
Macro?

(That's ET macro, not econo-macro.)

by ThatBritGuy (thatbritguy (at) googlemail.com) on Wed Feb 25th, 2015 at 07:15:48 PM EST
[ Parent ]
((duh))

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Feb 26th, 2015 at 02:02:23 AM EST
[ Parent ]
JakeS:

By negotiating directly with the Eurogroup, rather than the Troika as a whole, they managed to leave the IMF and ECB outside the room where the deal-making happened. As it turns out, the Troika couldn't maintain internal discipline: The party actually present at the table disproportionately gave concessions on areas valued by the parties not at the table.

What surprises me is that the Troika allowed their interlocutors to split their coalition like that.

Yup.

Greek Finance Minister Varoufakis Wants Austerity ... for the Rich - Truthdig

Now, why did he think he was negotiating with the troika when in fact he was negotiating with [crosstalk]

HUDSON: Because officially that's who he's negotiating with. He went and he took them at their word. And then he found out--and yesterday, Jamie Galbraith, who went with him to Europe, published in Fortune a description saying, wait a minute, the finance ministers are fighting with the troika. The troika don't have their story straight. The troika and the finance ministers are all fighting among themselves over what exactly is to be done. And to really throw a monkey wrench in, the German finance minister, Schäuble, said, wait a minute, we've got to bring in the Spanish government and the Portuguese government and the Finnish government, and they've got to agree.

Well, all of a sudden the position of Spain, for instance, is, wait a minute, we're in power, we're a Thatcherite neoliberal party. If Greece ends up not going along with austerity and saving its workers, then Podemos Party in Greece, in Spain, is going to win the next election and we'll be out of power. We have to make sure that Varoufakis and the SYRIZA Party is a failure, so that we ourselves can tell the working class, you see what happened to Greece? It got smashed, and we're going to smash you if you try to do what they do; if you try to tax the rich, if you try to take over the banks and prevent the kleptocracy, there's going to be a disaster.

So, obviously, Greece and Portugal want to impose austerity on--Spain and Portugal want to impose austerity on Greece. And even Ireland now has chimed in and said, my God, what have we done? We have imposed austerity for a decade in order to bail out the banks. Even the IMF has criticized us for going along with Europe and bailing out the banks and imposing austerity. If SYRIZA wins in avoiding austerity in Greece, then all of our sacrifice of our population, all of the poverty that we've imposed, all of the Thatcherism that we've imposed has been needless, and we didn't have to do it

....and so the ancient, sinister spell that had kept Europe in thrall for so long was finally broken by truth to power. Little David Tsipras and the slingshot against the mighty Goliath of the marketistas.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Wed Feb 25th, 2015 at 07:46:09 PM EST
[ Parent ]
Galbraith made this point in his article in Forbes recently.
by Upstate NY on Thu Feb 26th, 2015 at 09:18:35 AM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 05:46:15 AM EST
The first important point that caught my eye:

The juicy interview of Greek Finance Minister, Yanis Varoufakis - The Greek Analyst

There is today a schism in what was previously the TROIKA. There is the Commission - and this is my take on the matter - that has decided that it will play the role of the monitoring of the Greek crisis.

Hatzinikolaou: So, you are telling me that the government will be talking institutionally with these bodies, and these three institutions will be talking with our own corresponding technical groups? Employees will be talking with employees, and politicians with politicians? Is this the meaning [behind the change]?

Varoufakis: And even besides that, something more important. We will be talking with the European Commission. The EC can coordinate with the ECB if it wants, and with the IMF.

So Moscovici et al will be tasked with the review? Not all three institutions?

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Feb 26th, 2015 at 06:00:05 AM EST
[ Parent ]
My takeaways :

TIFKAT (The Institutions Formerly Known As Troika)

the primary surpluses, which if they remain at 3% or 4.5%, even the herrings will cry for us, since not even 1 euro will remain for social policy.


It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Thu Feb 26th, 2015 at 08:30:19 AM EST
[ Parent ]
Those are by the interviewer.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 08:32:30 AM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 06:13:48 AM EST
RT: `V for Varoufakis!' German heavy metal video about Greek bailout takes off (February 26, 2015)
"He's the lost son of Zeus with a heart made of stone!"... he "smells of sex"... "his leather jacket is made of skin from German shepherd puppies"... "He doesn't negotiate, he simply kicks ass". These are just some of the lyrics to the awfully catchy metal tune about Yanis Varoufakis that is taking YouTube by storm, with 6,300 views in just four hours.

The video, courtesy of Now Magazine Royale, proudly, and in an almost mock-Germanic tone, lists the Germany's achievements - the positive (like the economy, the large gold reserves etc.) and the negative ones (like starting two world wars and "almost" winning).

...

"Dear Greek Folks, the time has come: we surrender! Take all our money, you may also take Helene Fischer, but please, keep this financial Hercules off us. We could only just bear with Costa Cordalis [a German singer of Greek origin], so this is clearly way too much!" the description to the video reads.



A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 08:00:40 AM EST
the positive (like the economy, the large gold reserves etc.)

From the off after the second: "Don't ask us where it came from"

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Feb 26th, 2015 at 08:19:38 AM EST
[ Parent ]
German humour rocks!

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Thu Feb 26th, 2015 at 08:38:01 AM EST
[ Parent ]
IOW it's not "almost" but completely mock.

Perhaps we shouldn't ignore Varoufakis's sex appeal as a significant factor: you could sense the terror of the establishment in Germany at Varoufakis becoming the dream of every housewife.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Thu Feb 26th, 2015 at 08:39:20 AM EST
[ Parent ]
V will surely let Schäuble have Helene Fischer.

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin
by Crazy Horse on Thu Feb 26th, 2015 at 09:07:42 AM EST
[ Parent ]
business live | Business | The Guardian

The German Association of Journalists has called on Bild to ditch its anti-Greek campaign.

They argue that Bild has crossed the line into political campaigning, by urging readers to pose with their "Nein" poster ahead of tomorrow's Bundestag vote [see earlier post].

They added that it is ethically questionable to vilify a whole nation for the fiscal mistakes of their politicians.



It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Thu Feb 26th, 2015 at 08:39:44 AM EST
[ Parent ]
In test votes, only 22 CCDU/CSU members of parliament voted no and 5 abstained. Meanwhile, Schäuble is angry about the suggestion of debt restructuring in the Charlie Hebdo interview.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu Feb 26th, 2015 at 08:49:15 AM EST
[ Parent ]
Part of the whole agreement by the troika was a writedown of the debt if Greece maintained a primary surplus. They already agreed to this. Years ago.

AGREEMENTS MUST BE KEPT.

What the heck is Schauble talking about?

by Upstate NY on Thu Feb 26th, 2015 at 08:58:07 AM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Feb 27th, 2015 at 10:17:07 AM EST
[ Parent ]
Here's where the last cut in the video comes from (at 1'55"-2')
Varoufakis describes his strategy: no GRexit but default inside EMU and stick middle finger to Germany.

(seminar held on 15/05/2013 at cinema Europa, Hall Müller, Zagreb, Croatia)



A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Thu Feb 26th, 2015 at 10:35:43 AM EST
[ Parent ]
Palast to Syriza: Don't Lie, It's Impossible to End Austerity Within the Eurozone

Syriza wants to do the impossible, which is to get rid of the austerity that comes with the euro, and yet keep the euro. They want to cure themselves of leprosy, but they don't want to leave the leper colony, and that's impossible.

Let's talk about the history of the euro. You've mentioned in past interviews and articles that you knew the founder of the euro, economist Robert Mundell. Tell us about the economic worldview of Mundell and what his views were in giving birth to the idea of the European common currency.

Mundell, who taught at Columbia University, won the Nobel Prize for his writings on currency, and what's interesting is that he won the Nobel Prize for the theory of optimum currency areas, the theory that nations should join currency unions when they have similar economies. Therefore, agriculture economies should have a joint currency; he thought the US and Canada [should] have two different currencies, east-west, not Canadian-American, but the western US should have one currency with Canada, and eastern Canada and the eastern US should have one currency. In other words, he believed that a combination, like putting Germany in the same currency zone as France and Spain, would be ridiculous; it's a violation of his core theory through which he won the Nobel Prize.

Why is this important? This is the very same guy who is the inventor, you could say, of the euro, which he called the "europa" - that there should be one single common currency for all of Europe, damn the optimum currency theory. Now why would someone suggest a currency that is exactly the opposite of everything he's taught? I spoke to him about this, and he said that it has nothing to do with creating a good currency. It has everything to do with changing the politics of Europe. He was very, very right-wing. He is the creator of another economic theory, which wouldn't get him the Nobel Prize; in fact, it's called "voodoo economics," supply-side economics. That is, the more you cut taxes, the more tax revenue you get. The more deregulation of business you get, the better your economy - and if you deregulated the banks, there would be less risk in the banking system. All of those supply-side systems, which we call "Thatcher economics," "Reaganomics," after Ronald Reagan, it's all been discredited; it's all called "voodoo economics," and yet, that's what the euro is. It's an instrument of voodoo economics. "This was not a mistake; this was not something that they tried to avoid. It is what they wanted to happen, a crisis that would cause a realignment of political power and the end of the European welfare state."



'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Thu Feb 26th, 2015 at 09:17:11 PM EST
The Reality of Retreat | Jacobin

The first sophism: "Syriza has no mandate to quit the eurozone." If it had adopted such a position, it wouldn't have won the elections. Putting it that way, we see how absurd this reasoning is. Yes, of course it had no mandate to quit the eurozone. But it certainly didn't have a mandate to abandon the core of its program in order to hang onto the euro, either!

And, without doubt, if it had presented itself to the electorate saying, "here's our program, but if we find that its implementation is incompatible with keeping the euro, then we'll forget about it," then it wouldn't have achieved much success at the polls. For good reason: keeping the euro at any cost is exactly the same fundamental argument as the pro-memorandum parties who've ruled Greece all these years put forward.

And even if Syriza never fully clarified its position on the euro, it did always reject the logic of "the euro at any price." On that note, let's remember that contrary to what most commentators think, Syriza's programmatic texts do not rule out leaving the eurozone if forced to by the Europeans' intransigence, or defaulting on the debt payments. Though it is true that recently these texts seem to have been rather hidden away.

A second variant of this first sophism: Syriza had a dual mandate of breaking with austerity and staying in the euro. This sounds more rational than the first version, but nonetheless it is still sophistry. It's as if the two sides of this mandate were equally important and thus it would be politically legitimate, if we had to choose (and indeed we do have to choose -- that's precisely the problem), to sacrifice the break with austerity on the altar of keeping the euro. Without having even abandoned its mandate!

But then why not turn that reasoning around and say, "since I realize the two objectives are incompatible, I choose to stick to the break with austerity, since essentially that is the reason why Greeks voted for a party of the radical left?" That is, to opt for the rupture and not stability within the existing framework. We might at least think that this choice is more befitting of a radical left party that sets socialism as its strategic goal (even if that clearly wasn't the agenda on which it won the elections).



'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Thu Feb 26th, 2015 at 09:20:33 PM EST
Indeed, indeed. See Streeck. In fact, this is the main thesis of the third diary that I didn't write/haven't yet written about his book.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Fri Feb 27th, 2015 at 04:27:07 AM EST
[ Parent ]
Oops. This comment applies to your previous post, of course, about the intentions of the builders of the euro.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Fri Feb 27th, 2015 at 04:30:19 AM EST
[ Parent ]
A lot of people have been opining about the desires of the Greek people over the last several years.

I haven't been convinced by any of them.

by Upstate NY on Fri Feb 27th, 2015 at 08:32:29 AM EST
[ Parent ]
Kouvelakis sees any attempt to remain in the Euro as a betrayal anyway. He saw an opportunity for SYRIZA to shift towards the drachma with the crisis in negotiations, and sees this deal as a failure.
Thus he has to portray the deal as some sort of total capitulation, despite this being a 4 month deal that pushed the can down the road, which it isn't in practice. The Greek government seems determined to use this "creative ambiguity" of the treaty in order to follow the exact policies it has promised immediately after the elections.

Thus as the new legislative period starts next week, SYRIZA plans within the week to:

  • Reopen the Public broadcaster ERT, rehiring *all of its employees"
  • Start a parliamentary investigative committee on possible criminal responsibilities of previous governments for bringing in the IMF and the troika's memoranda
  • Banning of bank foreclosures and evictions of people from their primary residence
  • A formerly vetoed bill that allows back taxes to be paid in as many as 100 installments
  • A bill that will introduce emergency measures to combat the humanitarian crisis in Greece (from food-stamps to free electricity)

...While the minister responsible for labour affairs has announced that immediately afterwords that a bill will be submitted reistating collective bargaining, which was demolished at the troika's insistance and the previous governments' complicity, a measure on which both the IMF and the ECB have issued warnings not to proceed...

This simply would not follow from Kouvelakis' analysis. In fact the article laments that things such as these are not possible, since it insists that "Syriza will in fact be forced to operate within the existing framework". It isn't. And the next few weeks will demonstrate this as an empirical fact. How the "institutions" will then react to this is a whole different story

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

by talos (mihalis at gmail dot com) on Fri Feb 27th, 2015 at 10:36:37 AM EST
[ Parent ]
It's interesting that in two of the most reliably pro-Greece (or at least least anti-Greece) left-of-centre MSM I read, The Guardian (UK) and taz (Germany), almost all op-eds have a rather negative view of the deal as a capitulation, in line with the picture Schäuble wanted to perpetrate with his public slights.

However, in an op-ed by Thorsten Denkler (Süddeutsche's Berlin correspondent), I found the following, remarkably sober view, which is more in line with the picture Varoufakis & co want to paint, (and that without expressing any sympathy for Greece's plight or argument against austerity):

Schäuble und Griechenlandhilfe - Machtlose Mätzchen - Politik - Süddeutsche.deSchäuble and Help for Greece - Powerless antics - Politics - Süddeutsche.de
Die ganze Debatte am Morgen im Bundestag, die relativ vielen Neinstimmen aus dem Unionslager, all das soll den Menschen im Land zeigen: Die haben sich diese Entscheidung nicht leicht gemacht.The whole debate in the morning in the Bundestag, the relatively large number of votes against from the CDU/CSU, all that was meant to show the people in the country that this decision wasn't taken lightly.
[...][...]
Es kann niemanden ernsthaft verwundern, wenn Varoufakis jetzt die Liste als ein Dokument "produktiver Undeutlichkeit" beschreibt. Er erklärt übrigens auch, dass ihn ein Finanzmister der Euro-Gruppe gebeten habe, die Liste nicht konkreter zu fassen. Sonst wäre sie womöglich nicht zustimmungsfähig gewesen. Das mag stimmen oder nicht. Aber klar ist: Beide Seiten müssen ein hohes Interesse daran haben, dass die Griechenland-Rettung nicht Ende des Monats abrupt endet. It cannot seriously be a surprise to anyone when Varoufakis now describes the list as a document of "productive vagueness". Incidentally, he also explains that it was a finance minister of the Eurogroup who asked him to not to take the list more specific. Otherwise it may not have been suitable for approval. That may be true or not. But it is clear that both sides must have a high interest preventing an abrupt end of the Greek bailout at of this month.
Es sei gerne noch einmal darauf hingewiesen, dass mit den Milliarden aus dem zweiten Hilfspaket, das jetzt verlängert wird, nicht allein die Griechen gerettet werden sollen. Nein, es sind vor allem die öffentlichen Haushalte und - zu einem geringeren Teil - die europäischen Banken, die vor einem finanziellen Härtetest bewahrt werden müssen, sollten die Kredite an Griechenland platzen. Es geht um dutzende Milliarden Euro, die dann auch deutsche Steuerzahler aufbringen müssten. Das ist es, was Schäuble meint, wenn er im Bundestag sagt, für Deutschland könne ein "großer Schaden" entstehen, wenn das Paket nicht verlängert werde. Und ist genau der Grund, weshalb Schäuble Varoufakis trotz aller Brachial-Rhetorik doch recht machtlos gegenübersteht.It shall be pointed out again with pleasure that the billions from the second rescue package that was now prolonged aren't only meant to rescue the Greeks. No, it's primarily the public budgets and - to a lesser extent - the European banks that need to be saved from a test of financial hardship, should the credits to Greece plop. This is about a dozen billion Euros which would then have to be doled out by German taxpayers, too. This is what Schäuble meant when he told the Bundestag that Germany may incur a "great damage" would the package not be renewed. And that is exactly the reason why Schäuble, in spite of all the macho rhetoric, is still facing down Varoufakis rather powerless.
Es wäre gut, wenn Schäuble sich nicht länger mit gespielter Empörung auf Mätzchen mit Varoufakis einlässt. In den Umfragen gewinnt Schäuble dadurch zwar immer mehr Sympathiepunkte hinzu. Die Griechenland-Rettung hingegen sehen immer mehr Deutsche skeptisch. Das ist gefährlich. Nicht helfen ist schon aus Selbstschutzgründen keine Option. Darum darf sich der Gedanke, Griechenland könne ja vielleicht auch fallengelassen werden, gar nicht erst festsetzen. It would be nice would Schäuble no longer get involved in antics with Varoufakis with mock indignation. This may get Schäuble a few more approval points in opinion polls. However, an increasing number of Germans view the Greek bailout with skepticism. This is dangerous. Not helping is not an option out of reasons of self-protection already. Therefore, the idea that maybe Greece could be allowed to drop should in no way be allowed to settle.


*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Fri Feb 27th, 2015 at 02:12:41 PM EST
[ Parent ]
I'm starting to wonder if they didn't both blink as the depth of the abyss between them became obvious.
At that point they both walked backwards, neither ready to pull a lever that might undo sixty odd years of attempted European unity.
....And so they kicked the can down the road, maybe hoping for a deus ex machina to force events without their personal complicity.
Having said that although they both walked away a bit battered by the encounter, they'll both live to fight more battles in what looms to be a long war.
Schauble is a bit weaker, both because of his descendant arc of age and diminishing returns while Varoufakis' star is rising, young Turk that he is.
And because public opinion in Germany seems to have shifted slightly this last fortnight, risking Schauble being left in the political cold.
Also I think Germans are staying to resent their leaders putting them at loggerheads with the rest of Europe. Track record not great here...

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Fri Feb 27th, 2015 at 05:34:55 PM EST
[ Parent ]
Bundestag backs Greek bailout extension

While the four-month extension passed with a comfortable majority of 542 out of 587 lawmakers in the Bundestag who voted, there was a substantial rebellion within Ms Merkel's Christian Democratic Union and sister party the Christian Social Union. There were 13 abstentions.

...

Invoking the second world war, Wolfgang Schäuble, finance minister, told the Bundestag: "In the 70 years since this catastrophe, the German catastrophe, we Germans should do everything we can to ensure that we hold Europe together."



"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Fri Feb 27th, 2015 at 09:46:05 AM EST
Greek bailout deal gets Bundestag green light | Business | The Guardian

The German parliament has backed the extension of the Greek bailout by four months with an overwhelming majority - the biggest yet of any Bundestag vote on measures to fight the European debt crisis.

But in a sign of growing scepticism over Greece's financial aid package within Germany, 29 MPs from Angela Merkel's CDU/CSU bloc rebelled and voted against the plan. A total of 542 MPs voted in favour, with just 32 MPs voting against and 13 abstaining.

The finance minister, Wolfgang Schäuble, admitted at the start of the session: "This is not an easy decision for any parliament member." He also told MPs that Greece is not getting more money.

"We're not talking about new billions for Greece, we're not talking about any changes to this programme - rather it's about providing or granting extra time to successfully end this programme."

Yeah good one Wolfie... Extend and pretend... that nothing has changed.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Fri Feb 27th, 2015 at 10:10:25 AM EST
[ Parent ]
Talos, for lack of a better place to ask this of you, has anyone in Greece brought up an examination of the Constitution in relation to the crisis.

If the worst happens and Greece is forced out, one of the biggest worries is the legitimacy of contracts and their redenomination. As Varoufakis has pointed out on many occasions, this would be an absolute nightmare, since any seller would be expecting hard currency.

My question is this: given Greece's lack of functioning state apparatus, has there been any talk about a possible reset of the Constitution? When basic contracts go haywire, this would seem to be an optimal point to start from scratch at ground level zero--as if just after a war.

My real concern is the land registry. This is a really good way for the elite to hide money in Greece. The land registry needs to be locked in.

by Upstate NY on Fri Mar 20th, 2015 at 11:13:48 AM EST


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