Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.

Greece and the German elections: Truths unsaid

by talos Tue Sep 10th, 2013 at 09:36:13 AM EST

George Stathakis, a professor of Economics at the University of Crete, is a SYRIZA MP and Shadow Minister of Development. Recently he wrote an article titled: "The Greek Issue in the Imaginations of German Politicians", where he points out six obvious truths about the Greek crisis that are being eschewed in German electoral discussions about Greece. Below I have translated these six points as they highlight "Eurotrib common sense", I think, and are interesting by themselves as they pretty much echo the analysis of the SYRIZA leadership, quite possibly Greece's government after the next elections (whenever they might come, and it might not be too long now)...

front-paged by afew



  1. German taxpayers have not paid a single euro for the Greek crisis. The mechanism that provides loans for the crisis countries borrows money from the markets, not the taxpayers, on the basis of government guarantees that countries like Germany offer. The organisation's equity is only 80 billion Euros with 20 billion of those coming from Germany. Only these can be called theoretically "taxpayer money". Only in the case of a hair-cut will there be some fiscal cost for the guarantor states
  2. The ECB, which has been involved in buying bonds of countries under the memoranda is, up to this point, making a profit. The same holds for most of the other Central Banks that are being called to return these profits to Greece, as some have already done.
  3. German banks minimized their loses from Greek bonds through the first Greek memorandum, despite the PSI deal that followed, and Germany has benefited from the European crisis due to the fact that it can now borrow money at zero rates.
  4. The Greek programme is a parody that is sinking the Greek economy and weakening its ability to service not only the current debt, but even a smaller debt load. As paradoxical as it might seem, an economy that faces a debt problem needs, temporarily perhaps, more debt in order to recover. Austerity policies increase public debt while at the same time undermining the ability to service it
  5.  A third "loan package" is needed because of the first and the second such package. Repayment of 300 billion might have been postponed till 2020, but until then 83 billion Euros must be paid as interest, an amount that the troika reckons will be paid by budget surpluses after 2014 that will reach 4,5% of GDP and from privatizations, which are now estimated (after revision of the initial outrageous 50 billion euro target) at 22 billion Euros. For this to happen the troika is anticipating a return to growth by 2014 and a growth rate of 3% afterwards, based on an increase of exports by 50% compared to 2009 and an investment boom that will increase capital formation to 15% GDP per annum. Simply put, this is a science fiction scenario. This means that the funding gap might turn out to be closer to 80 than to 10 billion Euros.
  6. Greece must exit the memorandum and avoid by any means any new loans. For this to happen three things are needed: Debt reduction - direct or indirect-, transferring the 50 billion set apart for bank recapitalization to the banking union mechanism and a generous grace period of a payment of interest moratorium or a growth clause. A return to regular borrowing by Greece will only then become feasible and only if the ECB continues to do, as in Italy, what it should do: intervene or threaten to intervene every time lending rates rise.
The Greek issue is more convenient for the German electoral campaign than the Italian or the Spanish one. It revives the initial idea of a "special case" and diverts the discussion from its true dimensions which are European. Germany, as an "incomplete hegemon", can massacre the imaginary enemy of a "problematic" Greece, avoiding the discussion which concerns it, or which should concern it which is the European Crisis. There, silence pervades.

In my next diary I will touch on some of these points, along with an overview of the ways that Greece is being "reformed", which seems to be a major issue in the upcoming German elections...

Display:
Back after a long hiatus where I was doing vastly more than I could seriously find time for... Hopefully from now on things will be slightly better time-wise, unless they erect a Chinese-style firewall around the Greek internet, which increasingly seems not so far-fetched given the sort of government we now have :-)

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Mon Sep 9th, 2013 at 12:57:59 PM EST
Nice to see you again, your reports have been missed.

European Tribune - Greece and the German elections: Truths unsaid

(whenever they might come, and it might not be too long now)

Could you expand? I know DIMAR has left the coalition but continues to prop it up. Are they through with that or are MPs bolting form the coalition parties?

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

by A swedish kind of death on Mon Sep 9th, 2013 at 02:44:56 PM EST
There is a series of votes coming up in parliament, that involve deeply unpopular "reforms", aimed against the Class Formerly Known as "Middle" i.e. against small property etc. There are many MPs that have stated their refusal to vote for these measures. Already under the specter of parliamentary unwillingness the government has reneged (?) from its intentions to "unfreeze" "first home" repossessions. I.e kick people on the street. Also there is a strike wave brewing possibly picking up with a rolling 5-day strike strike by high school teachers, starting next week. Already yesterday a huge anti-government demo in Thessaloniki ended in a series of random "detentions", (with the detainees paraded by the police across streets witth hands behind their heads, war-prisoner style).

There is also the hope by the government that after the German elections Ms. Merkel will be kind enough to throw them a bone of some sorts that they can then wave as a trophy and call snap elections with.

DIMAR will not prop-up a decaying coalition, although they've sort of sentenced themselves to irrelevance. It seems now its possible that they won't make the 3% limit for the next elections

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

by talos (mihalis at gmail dot com) on Mon Sep 9th, 2013 at 02:57:25 PM EST
[ Parent ]
with the detainees paraded by the police across streets witth hands behind their heads, war-prisoner style

Class War is the quintessential war of our times. The "Middle" Class is the key target - just as in Babylon, Mycenae, and what not. Probably, the Arabs are even more creative in Iraq, Syria...

by das monde on Tue Sep 10th, 2013 at 01:41:18 PM EST
[ Parent ]
Go after those with enough assets to be of interest but not enough power to fight back effectively. In this case it appears to be a group of fit young women, probably with university education, are the target.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Sep 10th, 2013 at 02:22:21 PM EST
[ Parent ]
It should become a worldwide motif. Imagine millions of demonstrators throughout the world with hands behind their heads- a homage to the brothers and sisters in Greece.
by de Gondi (publiobestia aaaatttthotmaildaughtusual) on Tue Sep 10th, 2013 at 02:30:52 PM EST
[ Parent ]
What do the black tee shirts worn by the four women in the photo signify?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Sep 10th, 2013 at 02:51:53 PM EST
[ Parent ]
A good photographer's eye! The rest of the pictures do not show everyone in black, although police routinely pick detainees based on the kind of clothes they wear...

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Tue Sep 10th, 2013 at 03:05:37 PM EST
[ Parent ]
It is not possible to tell if all four women are wearing the same color of pants, skirts, or whatever. Does a group of women wearing a similar black tee shirt say anything political in this context?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Sep 10th, 2013 at 07:07:30 PM EST
[ Parent ]
I'm not even sure that they're all women. See here for a different view of the same "line":


The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Tue Sep 10th, 2013 at 08:10:15 PM EST
[ Parent ]
Continued here: Greece and the German elections II: Creating a desert and calling it "reform"

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Tue Sep 10th, 2013 at 03:08:22 PM EST


Display:
Go to: [ European Tribune Homepage : Top of page : Top of comments ]

Top Diaries