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Problem of debt agreement doesn’t lie on Greek Gov’t but on creditors’ different approaches

I am a bit confused about the controversial messages coming over from the other side of the Atlantic. Two messages came on Friday and both leading to one direction – deal between Greece and its creditors –  but on different speed.

the message by IMF’s Managing Director Christine Lagarde was.

“It has to be a comprehensive approach, not a quick and dirty job,” she said.

A few hours later, US Treasury Secretary Jack Lew had a telephone conversation with Greek Prime Minister Alexis Tsipras and urged him

“to quickly strike a deal with international creditors or risk immediate hardship for his country.”

According to Reuters and other media, Lew “cautioned that failure to quickly reach an agreement would create immediate hardship for Greece and uncertainties for Europe and the global economy more broadly,” a US Treasury official said in a statement.

So now what? A quick or Not a quick?

But difference of opinion does not occur in Washington only. A huge disagreement on how to approach the Greek problem and what kind of mid-solutions could be found divides also Greece’s European partners in Brussels and Berlin. With Eurozone leader Germany to insist on a rigid approach and full implementation of 150% austerity till the end of all Greeks’ days.

I assume the problem of not having reached an agreement yet does not lie on Greek Government but on the concepts’ diversities of its creditors and all persons and institutions directly or indirectly involved.

The rest is …waste of time, nerves and resources.

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  1. Bernadette Dodd

    Who made Germany the leader of the Eurozone? Are we not all members of one group? Why do the Germans believe they hold all power? Why can they not agree on a solution that will help the Greeks pay off the debt and grow their economy? It seems that Ms Merkel hopes for Greek failure why? We are supposed to be one body, to support those who need it and to encourage growth, Greece seems to be fighting a losing battle. The ideas of the governments in the past have been outdated and have not worked. It’s time for change from the faddy daddy old ways and x for fresh ideas!

    • Have you ever heard about a thing called “democracy”?

      Merkel: over 18 Mio. voters – Tsipras: less than 2,3 Mio. voters.

      The fact, that Tsipras wants money from Merkel without anything in return does not even make things easier.

      Now that you know thta: do you have an issue with democracy?

      Or would it be a good idea to hold a referndum in Germany on how much the German taxpayer has to pay Greece full constisting of “red lines”?

      Or do we hold this referdum in the other 18 Eurozone countries (many of them with a far lower wealth / income level than Greece)?

      The Syriza voters have no idea what they triggerd and this will cost Greece dire.

      • keeptalkinggreece

        it would be impossible for Tsipras to get 18 Mio votes in a country with 10 mio voters lol

        • This innumeracy and continued pro-German propaganda from the guy who says he is not German. Absolutely unbelievable crap. (Of course, to be fair, who would want to admit being German?)

          • Why not Italian? E.g. Alto Adige? Beautiful and prosperous…

            Because it does not fit into your narrowly confined mind?

        • It’s simply mathematics but then it takes some people some time to work this out!!!!!

      • It would of course be nice if for once YOU would know what you are talking about. The number of votes that Merkel or Tsipras or anybody else gets is totally irrelavant in the functioning of the EUROGROUP. All Eurogroup decisions are made by full agreement of all 28 members, and not by majority vote. This is so because of one of the founding principles of the EU which clearly states that ALL members, irrespective of size, have EQUAL rights. Unless a decision is to be made in the EP (which has no say in any of the ongoing negotiations), decisions are made by unanimous vote for or against….. The numbers of voters a country or political party gets in their country decides the representation of that country in the biggest impotent talkshop in the world, the EP. Nothing else…Once again, engage brain before opening mouth. It really helps…

        • You and your Syriza buddies oversee a tiny little thing:

          the mandatory parliamentary votes in the member countries for ANY change of the bailout agreements.

          But this explains a lot, by the way…

          In short: no successful finalization of bailout 2 – no money (€ 7,2 billion) and no bailout 3 (which Greece is already dependent on), because both a change of bailout 2 and bailout 3 would need to undergo parliamentary votes in most of the countries that are supposed to pay.

          Btw: nearly every answer to my posts consist in essence of “argumentum ad hominem” – this is a very clear sign of the shortcomings of the arguments of the Syriza supporters 🙂

          • Pray tell me where you get this mandatory parliamentary vote from? You love spouting crap, never come up with anything to back it up. We all wonder why…

          • Remember something called “No bailout clause” in the Maastricht treaty?

            EFSF/ESM are breaching it.

            Accordingly, there were several lawsuits filed – especially against the governments of creditor nations by their respective oposition parties.

            In Germany, e.g. the EFSF / ESM construct was only approved temporarily by the highest court on the grounds that the national parliament was not overruled in its budget creation souvereignity. – The European comission tried to bypass this in December 2010 with an amendment i order to make it the ESM independent from national parliaments, but this did also only win time, because we are back to square one: the No Bailout Clause of the Maastricht treaty.

            Does this now explain to the average left wing radical, why all the Southern European debitor nations are sitting ducks and holding still – completely contrary to the negotiation tactics of the brilliant Greek government?

            Any stiring up of the delicate ESFS/ESM construct lets the refinancing costs of the Southern European economies (incl. France) skyrocket.
            Should have been on the radar of Syriza. But I am afraid, they didn’t even have read or understood the contract. Else they would have chosen a different negotiation tactic.

            Btw: haven’t heard from Podemos for quite some time. No more common photos with Tsipras? – Too embarassing after the performance of the last 100 days?

          • Yes, just about everything Germany and the eurozone have done is illegal. What is your point here?

          • Giaourti Giaourtaki

            It’s 5.3 billion not 7.2, it was never 7.2

      • Giaourti Giaourtaki

        Destroying the climate and robbing the planet is also totally democratic against the 95% proletarian majority of world’s population.

  2. The Greek government is performing brilliantly. – The lack of progress is entirely the fault of the rest of the world, that is not able to understand how Greece would prosper with just a few more hundred billions of Euros with no strings attached.

    Wages and pensions would double, consumer confidence would be reestablished, the civil servants could outnumber the private sector workforce by factors and unemployment rate woukd be slashed, because the boom would reactivate even uneducated, incapable and lazy.

    Nobody would need to pay taxes and retirement age will be loweree to 45 years and nobody would ever – ever ! – think about austerity.

    This is the brilliiant concept of Syriza how to revive the Greek economy and due to this concept, they were elected with majority.

    • Chris, why don’t you just go and shove it where the sun doesn’t shine. I am sick to death of your mindless negative Greek bashing. Greeks work the longest hours in the EU, or hadn’t you heard? This is odious-debt and nothing more. The Greek people are not responsible (under international law) to pay back this money for which they never agreed to, nor benefited from. If you hate Greece and Greeks so much, why don’t you crawl back to the wonderful slave-society you seeped-from and not darken our pixels again…

      • Odious Debt?

        This is what the Greek Trace Balance looks like:

        GOODS Exports Imports Deficit
        2009 15,043.0 45,824.0 -30,781.0
        2010 16,794.3 45,084.7 -28,290.4
        2011 19,718.6 46,956.0 -27,237.3
        2012 21,716.9 41,368.1 -19,651.2
        2013 22,248.9 39,487.7 -17,238.8
        2014 23,480.2 41,330.1 -17,849.9

        (Source: Bank of Greece)

        Quite funny to call this “austerity”…

        Devlopment Average Annual Income (in current prices):

        2000 € 13,800
        2001 € 14,194
        2002 € 15,804
        2003 € 16,836
        2004 € 17,686
        2005 € 18,582
        2006 € 19,555
        2007 € 20,294
        2008 € 20,850
        2009 € 22,056
        2010 € 21,199
        2011 € 20,397
        2012 € 19,766
        2013 € 18,495

        (Source: Eurostat – don’t ask the figures before the introduction of the €, they were WAY lower)

        Do you need data for the too many and overpaid public sector employees and contracts as well?

        Everybody who is right in his mind is able to deduct the right conclusions from this data:

        Greece lived beyond its means, became incompetitive and the difference between wealth consumed and wealth generated was covered by debt. The development of the wages needs to be attributed to the unions (which call themselves now “Syriza” and never had to do with this development or even with PASOK).

        Greece will get the judgement of your “international law” on June 5th.

        • The data are actually less bad than the UK current account and trade figures. I don’t see you (Germans) threatening the British and telling them how badly behaved they are. I wonder why. Was it perhaps because you are afraid of Britain, owing to your shameful past and two world wars? And which European country, with its allies, had to teach the Germans a lesson?

          As a matter of record, Greece was on the winning side in both world wars, and we British have always appreciated that fact.

          • In my next life, I’ll become German, just to make you happy.


          • Giaourti Giaourtaki

            It’s Germoney’s 2nd try with a single currency, the 1st was for 21 states in WW 2 and ended 1944 but they nearly copy pasted its contracts for the 2nd try.
            These sadists hate Greece for her resistance that gave Russia time and punished her with punking her regarding unpaid war reparations and call her unthankful plus.

        • Giaourti Giaourtaki

          Very clear statistics: millions of people without any income

    • So sorry that as a German you can’t benefit from all that!

    • Your stupidity knows no bounds. What a pity that your intelligence and grasp of economics, on the other hand, are so feeble.

  3. Giaourti Giaourtaki

    “Consumers confidence” is some special capitalist bullshit where 1 farmer has to feed 300 citizens, who all will starve to death when this bullshit-society-system collapses and closes its supermarkets.
    Democrazy is part of this nonsense:
    “Out of the approximately 9.800.000 voters registered in the electoral records participation was at 63,5%, meaning that the valid votes were about 6.180.000, while the other 3.620.000, which accounts for 36,5%, did not go to vote. Out of those who voted, SYRIZA got 36%, i.e. around 2.200.000 voters, meaning that out of all the registered voters, SYRIZA’s government was based on less than 1/4 of the electoral body.” (Nikos Maziotis)

  4. After calling names to everybody involed (German, Dijsselbloem, Merkel etc) the fact remains: Greece has no money to spend. There are no savings for pensions or salaries. The working people (not public sector) has to pay for the pensions and salaries but that is not enough. The austerity measures are reforming measures which a lot of countries already set or put in place. If Syriza doesn’t want reforms just finish the negotiations and try to find the money elsewhere. Why has the EU (other EU countries) has to pay back IMF, ECB or other shortterm loans? When the EU doesn’t pay, Greece will have no money what so ever. So everybody who comments this column: what do you really want? Work for everybody, specialy young people or a country where you get a pension at early age <60 years, or you become a civil servant or wealth create by innovative Greek workers or …… So quiet complaining and spread your ideas to solve problems, create jobs and….

    • Giaourti Giaourtaki

      Syriza is making reforms: prison-reform, abolishing the hoodie-law, measures against humanitarian crisis, aso.
      What you call reforms are cuts and they happened the last 5 years, the main trouble with the pensions comes from the haircut and destroying jobs.
      Go out and build wind-mills out of wood or create a forest-program for that. It would bring 300.000 jobs and no need to drill in 5000 meters deep for oil and earthquakes. If you forbid ships which burn fossils on all Greek shores and start installing wind-turbines on ships and “Powerwall” batteries on islands and in households you’ll have another 200.000 jobs, not mentioned all the new jobs and possibilities in the farming-sector that would feed the people and 200.000 more you’ll get with all industries regarding bicycles. And after a few years you can get rid of capitalism and the money-system.

    • Please explain to us why foreigners who know nothing about Greece and even less about the Greek economy, feel entitled to post their ignorant opinions for Greeks to read?

      The fact is that Greece runs a balanced budget that is able to finance its ongoing domestic obligations with a small surplus. That is more than most EU countries can do, including the UK. What Greece cannot do — as explained by ministers on repeated occasions — is repay international debt obligations plus the domestic salaries and pensions etc., without the continued tranches of assistance from the Troika. Given the choice between allowing Greek citizens to live or repaying the IMF or the ECB, the government of Greece has decided to refuse to honour its international obligations.

      Of course, this is a negotiating position — because the Troika is playing hardball and refusing to make previously promised loans to Greece unless the new government does more or less the same as the previous Samaras government did. There would therefore be no point in elections or a change of government, and logically the end of democratic accountability. No democratic government could accept this, and it is remarkable that northern European countries take a different position. This indicates the lack of commitment to democracy across the EU — something that the Dutch, who failed to stop their country being taken over by the Nazis, should think about.

  5. Think Greece’s current economic malaise is the worst ever experienced in Europe? Think again. Germany, economic historian Albrecht Ritschl argues in a SPIEGEL ONLINE interview, has been the worst debtor nation of the past century. He warns the country should take a more chaste approach in the euro crisis or it could face renewed demands for World War II reparations.
    Der Spiegel

  6. While pointing fingers to the greeks, this is reality Bundesbank is eagerly hidind from germans:

    Since 2000, income inequality and poverty have grown faster in Germany than in any other OECD country. They increased by more in five years (2000-2005) than in the previous 15 combined (1985-2000).


    • “this is reality Bundesbank is eagerly hidind from germans”

      How? – When a brilliant investigator like you uncovers any conspirancy at a glance? When it doesn’t even take you 7 years to discover a strictly confidential and top secret OECD report (on their webpage)?

      Are you a hacker from Anonymous?

      • Not a secret OECD doc, just not deserving bold titles in German press (not suitable for a “top of mind” position). There the hidden.
        Thanks in advance for avoiding further sarcastic ad hominem comments.

    • Yes, the ordinary German people have been screwed over starting from the late 1990s,when salaries and pensions were massively cut. But it was done in the typical conniving way — those already in post had small or no cuts, only the younger generation would be affected. This is really hitting them hard, now. It was as the same time that the Germans devised their plan to replace the DM with the euro, using weak economies in the eurozone (primarily Greece and Portugal) to drag down its value.

      The whole thing is nothing more than part of a global neoliberal agenda – cutting wages and salaries for workers and the middle class while increasing company profits and the massive salaries of the owners and CEOs of multinationals. The sad thing is that most of the people affected by this are too stupid to work it out, and prefer to blame (a) immigrants, (b)the Greeks, (c) the eurozone or (d) the european union. In reality, it is the hijacking of democratic governance by the owners of capital — real old-fashioned Marxist stuff that we thought had gone into history,