Greece: Drachm or tragedy?

Greece: Drachm or tragedy?

by Pierre-Gabriel Bieri

The new Greek Government puts pressure on the EU. One thing is absolutely sure: It is for the Greeks to find solutions to bring their country back on its feet. And for this purpose no option must be excluded, however radically it may be.
Greek Prime Minister Alexis Tsípras is the new enfant terrible of EU policy. His party SYRIZA won the last general elections by far, after having launched a campaign against budget consolidation, for the increase in public spending and for tax hunting of the great fortunes.
The takeover of this grouping of the extreme left made the international bankers break out in cold sweat, while at the same time the Greek were affirmed with enthusiasm by the socialists of the whole continent. But the sight of these young politicians who dared  affront unabashed Brussel’s technocrats, also aroused a certain interest in the euro skeptics who saw this as a glimmer of hope for challenging the haughty European structure. The coalition of SYRIZA with a small right-wing conservative party, reinforced this impression of an anti-EU-front although it is rather an expression of a political tactic than a similarity of  profiles.

Postponing the confrontation until later

This first impression was raised to question at the end of February by the first agreement between the new Greek government and the Troika – which does not call itself Troika any longer. This agreement is interpreted quite differently. It seems that both parties have sought to reach a consensus – the creditors rather moderate, the debtors significantly more so. Or rather, to postpone the confrontation until later. The former grant a postponement of four months, during which they would cautiously maintain a state of which they fear, above all, that it could say goodbye to the European Union and its currency. The latter currently renounce demanding the cancellation of their debts – which does not mean that they will pay for them – and announce reforms that we do not know whether they will be really implemented; for the most part they now rather focus on the tax hunt of the rich than on the creation of wealth.
All this offers hardly any cause for enthusiasm. The electorate of SYRIZA is disappointed and reproaches the newly elected, whereas the representatives of the EU, congratulate each other for having demonstrated their legal strength, at least verbally, though not their political and financial one.
To make things even more complicated, and perhaps to gain time, the Greek Government maintains pressure on their European negotiators, by entering talks with Russia and China. At present, it seems unlikely that this will lead to an actual support; but in the end this is a legitimate action! If the EU has lent Greece absurd sums for purely political reasons beyond any economic sense, some powers competing with the EU might be tempted to at least pretend to play the same game.

The Euro question

In principle, the creditors of Greece are right  in preaching a Spartan regime. The only problem is that neither the Germans, nor the EU-commissioners or the international donors have the right to dictate the Greeks what is right; rather, the Greeks themselves are responsible to put their country on its feet again. The budget consolidation for the interior is difficult to implement, but in case they are imposed from outside, they will certainly be perceived as humiliating and there will be no chance at all of implementing them.
We will get to hear that the EU representatives will have a say because they are the ones who have been lending money for years. Perhaps that is just the problem. Why have they taken such a risk? In order to look good? In order not to have to admit that at that time Greece did not meet the conditions to introduce the common currency?
Former French President Valéry Giscard d’Estaing declared that the Greek economy can not make a new start and recover with such a “strong” currency like the Euro, and that the exit from the monetary union – organized and controlled – would be the best solution. Why not? The question is delicate, but it deserves to be asked. One should even get away from looking at the EU construction as a sacrosanct organisation, from which the smallest retreat would be an intolerable insult. In order to avoid a Greek tragedy, it is worth thinking about it – both in Brussels and in Athens.    •

Source: Patrons No 03/2015

(Translation Current Concerns)

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