A Greek drama

I thought exactly that today when I read it in the news. They go to a referendum at which the people vote no to austerity.... Then they put forward a proposal accepting austerity. Wth

 

I was confused by that. The Greece debacle is sad, but fascinating to watch. I see both sides of the argument and both are valid. There is no easy solution for Greece. Bit of a Sophie's Choice.

 

Yeah.
Let's see what happens now. The Greek parliament has accepted most of the austerity including raising taxes and some cuts to pensions.
I don't know how this is gonna go with the people. My understanding is that pensioners are already struggling and taxes ( those who pay it) are already fairly high.

 

Waste time, money and get people on their side.

 

Now the people are peeved off!

 

One day a Greek government worker was digging through his office drawers when suddenly he came upon a magic lamp. Since he'd heard these jokes before, he knew that he had to rub the lamp and make the genie come out.

So he rubbed the lamp and - oh, surprise out popped a genie. The genie asked, as genies will "What is your first wish?" The Greek government worker thought about it for a second, then replied "I would like to be rich!" So the genie granted him his wish, and POOF! the man was surrounded by piles of money rivaling the heaps of even Martha Stewart and Bill Gates.

Since the Greek government worker knew the whole wish process, the genie didn't even have to ask for number two before he said "My second wish is to be on an island with beautiful women surrounding me and obeying my every command!" And POOF!, he was there.

Then the Greek government worker or, as I like to call him, civil servant decided on his third wish "I don't want to do any work ever again!" and POOF! ubiquitous ironic twist he was back in his office in Athens.

 

+1...does he get to keep the first two?

 

The Greeks will put up with only so much. The 18th century Greek poet Rigas Feraios who is still regarded as a hero wrote this as part of his famous battle hymn: "It's finer to live one hour as a free man than forty years as a slave".

Tsipras was trying to build on some of this nationalism by holding the bailout referendum but wanted a much stronger no vote to make it a political tool against the Troika.

Eventually, and I think the request to transfer 50bn of Greek assets to an external trust to be managed (of course the assets will be sold off) will be a step too far and the people and government will say enough.

 

Corrected

 

Whatever.

 

No Vote

 

http://www.abc.net.au/news/2015-07-13/eurozone-leaders-say-agreement-reached-at-greece-talks/6616448

Terrible news for Greece in the medium-long term. Fiscal austerity doesn't work and this bailout will only prolong the misery. All this will do is drive Greece deeper into recession. Democracy and the dignity of the people have been hung out to dry in this decision.

 

I agree. This deal was designed to be rejected by the Greeks. Classic prisoners dilemma - the Germans took Varoufakis' game theory and shoved it up his ***.

 

Austerity has been a failure for Greece. On Jan 17 2012, the New Democracy party won the election, they are a liberal conservative party. They did everything they were asked to do and the economy collapsed. Many economists have written how austerity is a failed and dangerous idea, not just in Greece but in most places.

The other European financiers know the bailouts won't work. They will just keep re-engineering bailouts until they figure out who will be suckered into taking the hit in the end.

 

True!
The USA spent 3 TRILLION dollars in quantitative easing after the GFC and it still took a very long time for their economy to recover. The advantage America had was that they were not set a certain level of debt and they also had their own currency so they could control their inflation and dollar through monetary policy. Greece is pegged to the Euro and with the austerity measures so they can’t stimulate their economy or employment because austerity reduces demand and shatters business confidence, which ends up being a self-fulfilling prophecy. Unemployment in Greece is currently 25% and youth unemployment is a staggering 60%. How much worse does it need to get before they realise it’s simply unsustainable!?

 

Oh, they realise! Its just they've got no say in the matter. The creditors are pulling the strings and making Greece dance a merry jig before they declare the game is up.

How many mixed metaphors was that?

Its ugly. The only end game is default. Its just a question of how the creditors want that to play out before they go there.

Cheers,
Michael

 

Does the Greek population have a choice but to endure a further recession whilst they rectify all the legislation that got them into this mess in the first place?

 

Greece and the EU are in a fundamentally unsustainable relationship which has to end at some point.