January 29, 2015
There has been much euphoria across Europe since Sunday’s elections in Greece. Alexis Tsipras, his boyish face fresh with triumph, hails a new era not just for Greece but the entire European continent no less. Man, this man is on fire. Just look at his rhetoric…
“The Greece of the elite has been defeated.”
“The verdict of the Greek people renders the troika a thing of the past for our common European framework.”
“Greece is leaving behind five years of humiliation and pain.”
“…the largest part of the public debt’s nominal value has to be written off,”
“….a moratorium on its repayment has to be imposed,”
“….a growth clause for servicing the remaining debt has to be introduced…”
Darling of all protest parties across Europe (left-wing, right-wing, Trotskyist, fascist, Maoist, nationalist, environmentalist … it matters not a jot) Tsipras is a hero because he showed the middle finger to the establishment …. and won. According to Tsipras Greece is a healthy bouncing baby and not sick at all – it is just suffering a form of figurative water-boarding imposed by some bossy out-sider and Tsipras has the cure for that. Say F..ck austerity F..ck Merkel and F..ck Brussels often enough and Greece will be healthy again and back on its feet in no time at all.
Can this man do no wrong?
Well, yes. A lot. He can make the Greek economy get even worse than it is now. Worst of all he’s going to cause a lot of heart-break to those who voted for him with such hope in their hearts on Sunday. Now that all the euphoria and triumphalism is 24 hours old perhaps a detractor dare provide an alternative view? Let us begin by examining Tsipras’ promises – this will reveal how, bit by bit, his promises and inspiring rhetoric begins to unravel, revealing him more deluded, false prophet than miracle medicine man.
Claim nu. 1: “The Greece of the elite has been defeated.”
Although eager to present himself as different to all those who went before Tsipras is, in fact, no different. As with the discredited politicians from Pasok and New Democracy, so too Alexis Tsipras. All of them, Tsipras included, are guilty of fudging the issue of the debt.
Did not the Greek ancien régime (those governing between 2001-2011) lie to the electorate in order to win elections. Did they not also make promises on pensions, wage increases and freebies. Did not those who went before continue to merrily spend borrowed money in full knowledge of the fact that it could not be repaid. Did not these discredited politicians, like Tsipras, claim that Greece could afford it all because it was now a proud member of the euro and, therefore, all other worries could be swept aside?
Tsipras is no different to the ancien régime. He is not a breath of fresh air. Like his predecessors Tsipras suffers from halitosis but disguises it with a blast of minty breath-freshener. Regardless of his left-wing rhetoric, his Trotskyist credentials, his symbolic laying of flowers at the shrine of victims of Nazi oppression Tsipras is a phony.
Does he really honor the victims of Nazi oppression by forming an alliance with a nationalist, right-wing, anti-Semitic, anti-immigration party? How honoured the victims of Nazi oppression must feel knowing that Tsipras is in cahoots with a party which is a whisker shy of extreme right-wing tendencies. On the one hand Tsipras lambasts UKIP as monsters but has no hesitation to jump into bed with a party that is on a par with Nigel Farage’s UKIP.
On Sunday night Tsipras was in a position to pick and choose his coalition partner. He could have opted for the more moderate Potami – but heady on election night fever and with the cries of adulation still ringing in his ears he chose the Greek Independent Party by Monday morning. Tsipras’ true colours are beginning to unfold. Perhaps he should discard his short back and sides and let his hair grow long?
Claim Nu 2: “Greece is leaving behind five years of humiliation and pain.”
No one in the EU wants another member state to suffer humiliation, fear, pain or authoritarianism. It is, after all, an institution founded on the rule of law, democracy and human rights and as such there is no quarter for such feelings. Nor have European tax-payers in Austria, Belgium, Finland, France, Germany, Italy, the Netherlands, Ireland, Estonia, Spain and Portugal, who contributed to the emergency fund that bailed the Greeks out sought to humiliate Greece. When Greece needed money in her darkest hour the remaining eurozone countries rose to the occasion with each and everyone contributing their tax-payer’s money to an emergency fund for Greece. How, Mr. Tsipras, does that humiliate a nation?
Tsipras may not wear a tie but he does favour chinos and blazers – perhaps a horse-hair kaftan would be more his style?
Claim nu 3: “The verdict of the Greek people renders the troika a thing of the past for our common European framework.”
Really? So if Tsipras considers the troika a thing of the past who exactly does he and his new found buddy in the right-wing Independent Party think they are going to renegotiate the debt with? Renegotiating the debt is, after all, their holy grail. Syriza talk grandiosely about the convening of a grand European Conference where all will be laid bare, the wickedness of austerity will be presented and the eurozone countries can see the error of their ways.
Alternatively one could argue that that grand European Conference has already met. Hundreds of times in fact – it is called the troika for want of a better word. Call it a European Conference if you prefer but it is still the same thing. The Greeks have been given plenty of chances to air their concerns and their concerns have been met – in the form of loans, low interest rates and delays in payment. These wishes were granted by none other than the Troika.
In any case, if the troika were to be disbanded what is the alternative? Are they going to hop from one capital to the next rather than talking to all three partners in one room? They could try and negotiate bi-laterally but that would be a complicated business. It’s a collective debt. Further, some Heads of State may say yes and some might say no and some might say maybe and quite a few might say go to hell …. and that’s not even starting on the IMF and the ECB, who are also owed money. The troika is not dead in the dust. It is the only body capable of helping Greece out of the mess it is in.
Don’t be fooled by Tsipras’ clean shaven cheeks – a long, straggly beard covered in desert dust is more his style.
Claim nu. 4: “…the largest part of the public debt’s nominal value has to be written off…”
Well, that’s easy to say when 1% of the Greek debt is owned by the Bank of Greece. Compare that to the eurozone which owns 60% of the debt.
Unlike in 2012 private banks have very little exposure to the Greek debts. They were forced to take a hair-cut and be damned. Eurozone Heads of State no longer worry about a run on the banks in the same way that they did in 2010. In a spirit of solidarity and in an attempt to keep the currency afloat the tax-payer in the euro-zone countries picked up what was left of the big fat Greek spending spree tab.
Although figures are hard to come by (and if anyone has access to these figures they can always forward them to euperspectives) it is estimated that every Belgian lent the equivalent of EUR 900 to the Greek emergency fund. That is every Belgian person not every Belgian tax-payer so it includes children, teen-agers, the unemployed and the disadvantaged. To put it in perspective a Belgian family of four lent Greece the equivalent of EUR 3600. That is a lot of money for an average Belgian family. The equivalent of a fancy Greek holiday in the sun.
If the largest part of the debt is written off the Belgian tax-payer can kiss his and her money good-bye. That is just Belgium. Add to that the Finnish, Dutch, Austrian, Estonian etc. etc. tax-payer. Politicians in these countries must also answer to their electorate at some point and writing off the Greek debt is not going to be popular with populations which are themselves suffering from a shrinking economy and their own budget cuts. Greece is not exactly showing much solidarity with their eurozone tax-payers.
Forget Tsipras’ spiel of not wearing a tie until a new agreement on the bail-out can reached – a string belt holding the kaftan together may be more appropriate?
Claim nu. 5: “…a moratorium on its repayment has to be imposed…”
Try telling that to the euro-zone tax-payer who is heavily in debt and required to meet their payments. Christine Lagarde put it eloquently when she stated “a debt is a debt”. Those of us in debt – which includes pretty much most of the European population understand this obligation.
This also brings us onto another problem which the eurozone countries, the IMF and the ECB are acutely aware of. If Greece can delay paying it’s debt – then what about Spain? Portugal? Ireland? Their populations, like the Greeks, have been making sacrifices – do they not also deserve a break? But if their debt is written-off, delayed and laced with growth clauses the money lent by the remaining tax-payers will never be returned. The currency will crash.
Tsipras should replace his shiny, polished shoes with leather sandals.
Claim nu. 6: “… a growth clause for servicing the remaining debt has to be introduced…”
OK, so when Greece begins to grow because of all the money it has been lent it can then insert a neat little clause postponing repayment. Seriously what planet is this guy living on if he thinks that the rest of the eurozone is going to be happy with any of these terms?
Greece has already been granted lots of concessions – lower interest rates than any other EU country, postponement of some debts, it has already been given billions of dollars in lump payments and it has been promised more – and still Tsipras rattles on about “Merkelism” as though she and all Germans were the devil incarnate. It’s not just the Germans who want to see their money back at some point – so do the Finnish, the Belgians, the Dutch, the Spanish, the Irish, the Portuguese …. It just so happens that Germany has been the most generous, has the most to lose and is not unreasonably asking Tsipras to grow-up and face reality.
So, to complete the look – forget the boyish face, the short hair-cut, the suit, the relaxed open-neck collar and the shiny shoes. See instead a man with long hair, wild-eyes, a straggly beard wearing a kaftan tied together with a string and leather sandals – and there you have it. A false prophet offering hope when in truth he has just plunged Greece into an even worse crisis than it was in last week.
In euperspectives’ last post it was reported that there was a show-down down at the OK Corral. No one’s blinked yet but the eye’s of both must be beginning to water. The truth is that Tsipras has limited options. Sure the eurozone countries could fire first and it could cause them some grief but not half as much grief as it would to cave into Syriza’s demands. The problem for Tsipras is that what ever direction he intends to shoot in Greece is the one that’s going to get hurt the most. His best policy would be to continue with the medicine that was beginning to bear fruit – but he can’t do that having staked his own reputation on his own form of quack cure.
Tsipras’ biggest sin? Following in the foot-steps of his corrupt predecessors. Promising the electorate he has the cure when looking closely at his medicine he has no such thing. Such a shame – and it was all beginning to look so promising for Greece at the end of 2014. What a wasted opportunity.
If anyone is going to humilate, hurt and dissapoint Greece it is not Germany, Brussels or the Troika. It is home-grown false prophets.