The Troika of the European Commission, European Central Bank & International Monetary Fund whom history will judge unfavourably, are part of the festering problem that is Greece. Even the IMF now owns-up to the established fact that the Troika has mishandled the problem of Greece, in admitting that the policies rigidly imposed were principally wage cuts & uncompromising austerity, with negligible attention to reform of state structures or product markets. Syriza’s main challenge is the residue of the scorched earth austerity policies of the previous 6-years. Reducing its GDP by 26%, and youth unemployment up to 62%. This position is described in a recent book entitled, ‘The Rape of Greece’, by Nadia Valavani, Syriza’s deputy finance minister. The EU-Troika forced a bankrupt country to take on additional credit packages, allowing foreign banks to effectively ‘dump’ their bonds onto Greek taxpayers, and trap the Greek population in sovereign debt slavery. As in Ireland, this process was expediently called a ‘rescue’ or ‘bailout’. Leaked IMF minutes for May 2010 stated that Troika loans to Greece, “may be seen not as a rescue of Greece, which will have to undergo a wrenching adjustment, but as a bailout of Greece’s private debt holders’.
Syriza’s Manifesto, the Thessaloniki Programme demands cancellation of “the greater part” of Greece’s public debt. Understandably and justifiably it seeks a “European Debt Conference”, at which it would have plenty to say for itself. Mr Varoufakis recently told Paul Mason (Channel-4): “ you can’t have a monetary union that pretends it can survive by simply lending more money to debtor countries on condition that they must shrink their income”. This has been admitted in leaked internal IMF documents of 2010
In case they are too readily recognised from a grand scale of Errors-of-judgement over recent years, they now only wish to be known by their individual office names. Economic and fiscal policies pursued by Germany since the beginning of EMU must carry the blame for the calamities that are currently threatening Europe. The electoral defeat not only of the mainstream conservative parties but also of their right-wing, nationalist challengers, and the total transformation of European social democracy in the direction of heterodox, fiscally expansionist economic policy, and the triumph of the as yet untested new left parties.” –Paul Mason (Economics Correspondent, Channel-4)
Given that over 90 Eurozone ministers were expected to work through the night, this week to resolve the impasse over the Greek bailout, but the meeting broke up after little more than an hour, when it became clear both sides remained far apart on how to fix the Greek economy.
The Greek prime minister, Alexis Tsipras, met the heads of the International Monetary Fund, European Central Bank and European commission late on Wednesday night, but talks ended in the early hours of Thursday with Greece “remaining firm on its position”, according to a Greek government official. Tsipras had already met the same institutions for six hours earlier on Wednesday, where he resisted demands for deeper spending cuts. He notified his Cabinet yesterday that his government is willing to negotiate on its demand for debt relief, but that they will not abandon its central promises to the Greek electorate, being quoted in the Telegraph as saying “we will not seek a catastrophic solution, but neither will we consent to a policy of submission. The country is holding up its head”.
Mr Tsipras & Mr Varoufakis are wagering that the Germans (and its fellow creditors) will not endanger Monetary Union at this late stage. They are rejecting major privatisations of Electricity & Port Authority utilities. They are proceeding with raising the minimum wage from €500 to €751 per month. These actions fly in the face of Troika austerity terms. Yanis Varoufakis old the Telegraph, “ a freshly elected government cannot allow itself to be intimidated by threats of Armageddon”. The constant media message put out by EMU policy enforcers, that Syriza is dithering on reform is quite ridiculous
Markets are waking up to Greek nuclear option occurring. Greece is likely to achieve a democratic revolution, in so far as it (still a Eurozone member) is refusing to play by the rules of the European Monetary Union elites.