A moment of truth for the European project

I thought that an appropriate way to celebrate Syriza’s victory was to do what I should have done a long time ago, and finally read Peter Mair’s Ruling the Void on the journey from Dublin to Oxford this morning. It’s a terrifically insightful (and readable, and short) book that had me nodding in agreement throughout, and you could base a whole series of blog posts on it. So let me just pick up, on the day that is in it, on one of the very last points made in the book:

…we are afforded a right to participate at the European level…and we are afforded the right to be represented in Europe, even if it is sometimes difficult to work out when and how this representative link functions; but we are not afforded the right to organise opposition within the European polity. There is no government-opposition nexus at this level.  We know that a failure to allow for opposition within the polity is likely to lead either (a) to the elimination of meaningful opposition, and to more or less total submission, or (b) to the mobilisation of an opposition of principle against the polity — to anti-European opposition and to Euroscepticism

Democratic political systems need oppositions which can force policy reversals if voters decide that that is what they want. Kicking the bums out is not enough, we have to be able to kick out their policies as well.

Syriza is opposed to European macroeconomic policy, and won the elections on that basis. They speak for lots of Eurozone voters, not just Greek ones. If the EU have any sense they will not play hardball with the new Greek government, especially since just about everyone agrees that Greece’s debt is unsustainable. Nor should anyone be hoping that the new Greek government will be “pragmatic”, and forget its opposition pledges once in government. The Greeks want fundamental change, and have voted for a democratic pro-European party to express that desire — which, you might think, is a lot more than the Troika deserves. If Syriza doesn’t deliver, for fear of upsetting its Eurozone partners, voters may turn to parties that really are anti-European. In the Greek context, that could be very ugly indeed.

How the EU responds to last night’s election will tell us a lot about the actually existing European project.

148 replies on “A moment of truth for the European project”

The ECB is the problem at the Euro level. I think the Commission is made up of more decent and less ideological skins but the ECB is in the driving seat and has driven the project into the ditch.

The key issue at the global level is that the neoliberal economic model is fuc#ed and power dictates that we throw more debt at the problem. QE is a joke when demand deficiency is the illness.

Deflation is taking over everywhere including the “well run” US and UK.
Coke sales are falling, McDonalds sales are falling, AB In Bev beer sales are falling.

The S&P price to sales ratio is around 25% above long term average. Earnings are good (due to cost cutting) but sales are flat. Another indicator of deflation.


The CBs can try to string things along for another while but eventually we’ll have to send a lot of debt to money heaven.

The problem with the quotation and the reasoning based on it is that the underlying assumption is that something such as a European EU government exists but that it is badly structured and needs an opposition.

This is, unfortunately, not the case. The EU is an international organisation with major supra-national (i.e. akin to a sovereign government) elements. The game of opposition is played out in the negotiations between the members in the institutions that govern it. The next day or so will demonstrate whether Syriza will pick up sufficient support among other parties to bring about a change in direction. I doubt it for the reasons advanced in two posts of mine on the banking inquiry thread which I am repeating below for ease of reference.

Two articles which raise the fundamental political question that is now posed not just for Ireland but the Euro Area.



If politicians convince the European electorates everywhere – with the exception of those in Germany, and a few other creditor countries – that there is a tooth fairy, who is going to supply the cash to put under the pillow? All are contributing, nominally at least, to the bailout facilities. Taking on a heavier interest-rate burden than Greece herself must surely prove unpalatable, even in the other peripheral countries.

The underlying figures from a blog post by Zsolt Darvas of Bruegel.


The crux of the problem is in this conclusion.

“Even Syriza argues that Greece needs major structural reforms. Yet it may be difficult to find an agreement between Greece and the Troika, because many of the current plans of the Greek opposition parties are in diametric opposition to reforms agreed under the financial assistance programme.”

The structures that need to be changed in order to bring about an increase in efficiency and production in Greece are not confined to the oligarchs which Syriza has in its sights. As the new government in Greece is made up of the far left and the far right of the political spectrum it will be interesting, to say the least, to see how the cold winds of financial reality will impact it.

“The rise of Syriza can’t just be explained by the crisis in the eurozone: a youthful generation of professionals has had enough of tax-evading oligarchs”


And DOCM- the assumptions baked into the last bailout were nuts.
Efficiency yada yada.

Demand is the problem across the EZ- it’s a deflationary race to the bottom while the rich cream all the QE money.

There is no growth and the ECB can’t even meet its own 2% inflation target.
Without that income ends up with the boomer generation who hold most of the assets. It’s an intergenerational war as well as everything else.

It’s interesting to see our tax dollars, seigniorage or whatever at work feeding the media monitoring operations of EU institutions what they want to hear. It’s kind of circular. It’s also a rather good demonstration of one aspect of the suppression of voices of opposition within the operation of the EU. We may be able to say what we like, but it can easily be smothered with astroturf.

@ DOCM: You’d be a brave – or foolish man to tackle with Peter Mair – even if he is no longer with us in person; his spirit sure lives on in his writings. The EU has a significant, and so far intractable, Democratic Defecit. ‘Structural Reforms’ of the European Parliament and/or the Commission will have little affect down on the farms.

What exactly do folk mean when they witter on about ‘structural reform’? In reality it means a reduction in living standards for the many, but not for the few. Again, its a political conundrum: state tax revenues are now consistently less than state expenditures. So, the governing politicians resort to borrowing (spending future taxes) in order to keep their seats in parliament. This works only so long as the aggregate, productive economic activity (nett of leveraged credit creation) of the state is positive, and comfortably exceeds the accumulating debt – since existing debts are never retired, they’re usually rolled over: contractural debt abides. Until it does not! Funny that.

Of course, the fact that current base interest rates are effectively zero or even negative is of great assistance.

Crisis in Brussels, Berlin and Frankfurt.

A serious outbreak of DEMOCRACY in Greece.

Peter Mair would approve; as would Cicero.

Who am I to disagree?

A problem is the lack of an elected executive in the EU that could be a focus for EU wide campaigns about these issues. The parliamentary elections – for a whole host of reasons that cannot be overcome any time soon – don’t fit this purpose.

Indeed EU issues affect domestic elections more than they do EU elections!

Good day for the Euro, bad day for Greece. If they really mean its Syriza’s way and not Frankfurt’s way well that surely spells Grexit, hence the Euro rise.

The rise would have been greater still had they got an overall majority but having to share power with neos gives the shinners an out, so there is still a risk that they will make some shabby compromise which they have no intention of keeping and the euro will limp along with this gangrous foot not amputated.

It will be interesting to see whether Greece can gather much support at the parliament or whether it can build any sort of coalition in favour of change outside of the council that could then affect the views taken by member states in the council

Indeed the difficulty of building any coalition (other than one of member state governments) that had a reasonable prospect of affecting policy demonstrates the democratic deficit – nothing matters except the views of current administrations

Views which are seldom, if ever, in agreement.

The EU is responsible for about 2% to 3% of TOTAL government spending in Europe. The bulk of the regal responsibilities of government still lie with the member countries. One can, of course, advocate changing the division of these responsibilities. But no logical argument can be built on the current division that relates “government” at an EU level to that at the national level.

Great to see Yanis Varoufakis as their new Minister of Finance; finally the heterodox economists being seen to be the sensible choice in the face of ideological monetarist buffoonery.

from KO’R’s Krugman link:

‘How did they get it so wrong? In the spring of 2010 both the ECB and the European Commission bought fully into expansionary austerity; slashing spending wasn’t going to hurt the Greek economy, because the confidence fairy would come to the rescue. The IMF never went all the way there, but it used an unrealistically low multiplier, which it arrived at by looking at historical examples of austerity while ignoring the difference in monetary conditions.

The thing is, we now have essentially the same people who so totally misjudged the impacts of austerity lecturing the Greeks on the need to be realistic.’

@The Second

Have a Fig Leaf; deserved for that comment.

Most people outside Greece think that a government’s economic competence is inversely correlated to the size of the deficits it runs – especially when the economy is sputtering. Frustrating though it might be, that is the reality, and the right-wing of the macro fraternity has wiped the floor with the left in terms of public perception (and that’s what counts – it might as well be the definition of effectiveness) since 2008. The macro-left’s PR machine has been pathetic and most ‘left’-wing politicians in non-crisis mired countries who want to gain power will not be seen in public with a macro-left idea any more than a bacon sandwich. Remarkable.

Macro-left cannot communicate its ideas convincingly even to its ‘own’ politicians & they are stuck preaching to the converted & evidently cannot connect with the man in the street unless he is at the point where he is actually ‘on the streets’.

As for deflation as the big, scary bogeyman:


Greek debt service costs according to Dan O’Brien are about 4% of GDP with all sorts of rinky dinks to keep the down. What the idealistic young fella wants to do is turn back the clock on reform – rehire all the super numerary public servants and restore pensions to pre crisis levels.
In other words, he wants debt forgiveness and a blank cheque to run the debt back up to 170% of GDP again. I presume there is a pony in there for everyone.

This can only end badly for the ex-commie. I will give it six months before the poor lamb is being excoriated on this blog.

Might I suggest that those wishing to celebrate Syriza’s victory do so by moving their savings to Greece asap. This would show solidarity in the most tangible way.

As for Mr Tsipras, it is the eventual fate of almost all left-wing politicians who assume power to be denounced for selling-out to capitalism and I doubt that he will be an exception. Sometime around mid-April should see the first Fintan O’Toole column denouncing him for his treachery and betrayal of the masses.

I saw Carney in the FT saying the BoE could get inflation back to 2%. I doubt it. Not if the oil price means deflation. But at least he doesn’t have the threat of the UK breaking up into 22 pieces hanging over him. So I think the EZ will go into existential crisis first. With the Uk to have a massive economic crisis shortly after.
And if DOCM is representative of institutional EU thinking there is nothing to stop the tragedy of the remorseless working of things.

I wouldn’t call it self-serving at all, but rather too self-comforting, to say that the election was an endorsement not only for policies the author agrees with, but that would objectively make everyone (even Germany!) better-off. Surely SYRIZA won the election because they demanded more money for Greece, and formed coalition with hard-right nationalists for the same reason.

Government has multiple branches – at a minimum including executive, legislative and judicial. Despite its relatively small direct spend, the EU intrudes very extensively into the legislative branch at national level, and quite extensively into executive and judicial branches. It is absurd to suggest otherwise.

It pains me to say it but DOCM is right to name check Rachman in the FT. Giving Greece a debt write down is politically unacceptable across the EZ and will lead to greater problems. It would be even more unacceptable to,give it without strict conditionality over borrowing levels,
It seems to me there are only 2 options. Syriza gets some face saving maturity extensions and strict conditionality. Bit that would be unacceptable to the lefties. That leaves the only palatable political alternative for Greece to leave the EU(ro), devalue the drachma and see if it can get enough tourists to pay its way.

Some extensions and recap the zombie EZ banks at the same time. Piecemeal is past its sell by date. If the EZ goes into full deflation mode it won’t be possible to repay all debt anyway.

It pains me equally to agree with the conclusion of TMD. The new government in Greece seems blind to the principle of sincere cooperation (Article 4.3 TEU) under which the governments of the EU – unlike the states of the US – are effectively the executive of the EU (there is no federal government responsible for national defence social security etc. etc.) and are required to stand by the obligations accepted by the Greek government, irrespective of whatever government is in power.

The conclusion is unavoidable; if the Greeks do not wish or intend to stand by the rules of the club, they must leave it; and also leave – almost inevitably – the remaining members with some unpaid bills! Some €365 million in the case of Ireland.

@ Tull
” Giving Greece a debt write down is politically unacceptable across the EZ and will lead to greater problems.”

Germany, after causing two wars that gave rise to the deats of 50 million people, was deemed a good candidate for a debt write off in 1953, not ten years after WW11 that she caused.
Why should the Greeks people not be worthy of similar debt relief.

Tsipras has challanged the idea, that the poor must be impoverished to keep the rich in the style to which they have become accustomed. He has also challenged the enforcers for the rich, the EC and ECB, who have, on the back of policies they enforced, displayed nothing but contempt for th sufferings of ordinary people.
Tsipras has loads of ideas and money to offer. There is somewhere between 80 billion and 150 billion of Greek money sitting pretty in Swiss bank accounts, with the EC, ECB, etc not raising a murmur of protest.
He can alsways ask the EC . ECB to get that money, as distinct from impoverishing the poor of Greece and elsewhere.
Keeping the poor in the place appears to be first item in the agenda of the EC – ECB powers.

This is a great victory for democracy.

Be a debaser
That modest proposal does seems to be all carrot and little or no stick. Greece gets to use the responsible adult credit card but gives little in return. I presume re-employing all those civil servants and increasing wages and transfers to pre crisis levels counts as a fiscal stimulus.
It would be better if Greece left the euro and EU and tried to grow its 10% of GDP export sector.
As an counterweight, ze Germans should also leave since they appear to want higher rates and a stronger currency.


€365 Million! Shocking!

And the ~€50 BILLION in odious financial system debt on Irish Citizenry.

1.6% of ECB ‘Capital’ (sic) Structure; yet >40% of EZ Banking System debt.

Punching above our weight? Or roight eejits for putting up with it?

Methinks the latter trumps the former all round.

p.s. unable to grant the fig leaf due to continuous zero reading on the BB-BAU $ham€ index, at the nano level.

Joe Ryan,
Perhaps the Greek PM could collect some tax revenue first before troubling the hard working tax payers of other EZ countries. Perhaps he could root out the political cronies in the Greek public service. He could put his own house in order before bothering the neighbours.

‘His first act as prime minister was to lay roses at a memorial to 200 Greek communists executed by the Nazis in May 1944. Analysts said the gesture left little room for interpretation: for a nation so humiliated after five years of wrenching austerity-driven recession, it was aimed, squarely, at signalling that it was now ready to stand up to Europe’s paymaster, Germany.’

That was the easy bit!

Text from Blind Biddy in Athens: A little social history

‘Few places in Greece conjure the spirit of resistance as much as the war memorial in Kaisariani. It stands on the spot where 200 political activists – mostly communists – were executed by Nazi forces on May Day 1944. The monument in a rifle range in one of Athens’ “red” suburbs, is redolent of defiance but, perhaps more than that, the battle against tyranny. That Greece’s new prime minister Alexis Tsipras, Europe’s first radical left leader, should elect to visit the monument minutes after being sworn in, is rich with symbolism – and defiance too. Red roses in hand, resistance veterans looking on, the young firebrand paid homage to the victims in his first act in office. “It represents national resistance to German occupation,” says Panos Skourletis, spokesman of Syriza, an alliance of far-left groups ranging from Maoists to greens. “But also the desire of Greeks for freedom, for liberty from German occupation.”

If explanation were needed, he adds: “It was purely symbolic.”
Tsipras told thousands of supporters in a victory speech on Sunday that he would seek to restore “their lost dignity”. For Greek leftists, widely persecuted after their defeat in the bloody civil war that followed the Wehrmacht’s withdrawal from Greece, such gestures are hugely significant.

The men and women who were shot dead at dawn that day were killed in reprisal for the guerrilla ambush of a German general, Franz Krech, and three of his aides at Molaos, near Sparti, in the Peloponnese.

Famously they began to sing – giving an uproarious rendition of the Greek national anthem – as they were lead to their deaths from the notorious SS-run camp at Haidari, then a suburb on the outskirts of Athens. German soldiers looked on astonished as the Greeks broke into song. Once at the range, the hostages refused to undress – insisting that they go dressed with dignity. It was an act of resistance that in austerity-whipped Greece resonates greatly today.


Note: Churchhill sent in the British Army to ‘assist’ in defeating the red partisans who had fought so bravely against the nazis. [h/t Paddy Zhukov in Kharkov]

The problem for the Germans is that they have no plan to get out of the mess by boosting growth and employment. So they are reduced to bringing everything back to “rules.” Extend and pretend will only bring you so far. And people are not stupid.

When all you have to offer is deflation it’s very hard to close the deal.

People with kids may have seen the movie Epic. I’m sure a lot of Greeks think Merkel is a bit like Mandrake

The next stage of the European project- the descent into deflation – is happening while the ECB is suppressing market volatility. I wonder if the hedgies aren’t looking at it wondering if an SNB moment might come to pass.

We should all celebrate the election results because they represent an end, within Greece at least, to the long bullsh*t phase. If they don’t want to pay their debts (and they shouldn’t) that is fine – they have a primary surplus now and presumably don’t need any new loans (post-default). Living standards will fall even further, but at least the country will have a sense of what their national income really buys. They should leave the eurozone and let the ECB repair the damage to lenders.

The fundamental problem for Greece is not external – it’s an internal debate about the kind of society they want to have. Even with their much reduced (ie true) GNP they could have a decent, fair society without the degradation they have had over the last 7 years.

@ DoD

“Famously they began to sing – giving an uproarious rendition of the Greek national anthem”

The argentine parliament also famously sang the national anthem after voting to default on much of their national debt in 2001.

It seems that not paying back money and being shot for your principles are conflated concepts in the minds of some.

Who misled whom?
The Troika said their policies would reduce Greek GDP by 5 per cent.
Their policies reduced GDP by 25 per cent.
A genuine mistake or a criminal colonial act.
How dare the Troika ask Greece to live up to its sovereign signature, following such a criminal imposition of policies they knew would not work.


Never a truer word. Let them leave the EU(ro) and retool their own society. The omens are not good though. Tsipiras is rasing expenditure and cutting penalties on tax evasion so we know how that is going to end.

Once Greece leaves the EU, attention then will turn to the next potential exiter. At that point the Germans have to decide whether they will allow the ECB to buy about half the sovereign debt and lock them the vault for a century. Either that or the euro breaks up, the EU breaks up and the German taxpayer ends up holding the bag for the whole lot. 1918 and 1945 redux.

@ Tull

Greece is an outlier for European capitalism. If they have to cut their cloth to fit so will everyone else. France and Italy have been living beyond their means too, as has the UK. And if the Germans want a hard currency it’s going to hurt.


None of this was done for Greece’s benefit anyway – it was all about making sure that greedy lenders never had to pay for their disastrous risk management. Greece is a debt junkie and the kindest thing we could do for them is stop lending them money. The loans are of zero value to Greece and are only designed to keep badly run banks in the lending core in business.

I see Godwin’s Law has become rampant in these parts.

The Greek Shinners are making a big mistake if they think they can whip up cross EZ anti German sentiment by playing the holocaust card.

In fact the great majority of the EZ club support the German position (unlike in WWII). Ironically the few who might buy this angle, Italy, Spain and Ireland, would have been highly sympathetic to Nazi Germany.

We have been here before and it has always been the creditors who backed down. Remember that Greece secured a massive debt restructuring and write-down in 2012 which reduced its nominal debt by over €100bn while imposing a 50% haircut on private sector bond holders, at the behest of the official creditors. Clearly, Greece’s creditors (including Ireland, owed €346mn from the 2010 bailout) have to date at least viewed more support for debtors as the least bad option. Perhaps this time may indeed be a watershed but the recent record suggests not.


I would agree with you. The Greek politiy do not seem to be able collect taxes and allocate money in a half way prudent fashion. They are not the only society with this flaw. It will be the same whether debt service costs are 0% or 4% of GDP or whether they are in or out of the Euro or the EU.

Whether Greece defaults or not will not hurt core banks because they have little exposure at this stage. It will make core voters angry though when they see money going to heaven.

As Seafoid says, it is at that point that we see what ze Germans are willing to pay to avoid the consequences of a 20-30% currency appreciation along with the chaos of multiple defaults.

@ Tull

I think your 20-30% is a rather low ball estimate of the likely new DM appreciation when the Götterdämmerung arrives. It all depends on how much money wants to get into the currency and if defaults start happening it could take ages to settle down. Just think of all the serious family money in Italy and France that will be advised to seek alternative accommodation, not to mention the leveraged hedge fund bets. Remember that markets are basically following a til now profitable trend that says the US economy growth story is for real and that nothing serous will happen in the EZ.

The CHF trade weighted exchange rate is around 1.45 to the euro as are Swiss prices and now it’s trading at 1.017.

The head of the SNB can talk about overvaluation until he’s blue in the face but that is the level at which punters are happy to buy given the state of play in the Eurozone.

@ Johnny Foreigner,

You’re go it alone Greek solution assumes the entirety of the Greek debt is toast, however unrealistic that seems, that’s the net result.

It also assumes that the current drivers within, lets not forget, a euro based economy, remain. I would expect that the resultant exit from the Eurozone would virtually guarantee a continuation of the current primary surplus is highly unlikely. Greece downsizing to an Albanian type economy is relatively easy to imagine.

I’ve absolutely no doubt that whatever solution is agreed it will NOT see Greece exit the Eurozone. The primary reason is that it is impossible to extrapolate the negative side effects of such a move and therefore a risk too far even for the new Govt. Their more radical than their predecessors but their not stupid.


‘Syriza is calling for a European debt conference similar to the ‘London Agreement’ after the Second World War, which wrote off around 60% of Germany’s debts and extended the timeline for repayment by decades.

It proposes a writedown of all eurozone debt over 50% of GDP. This is not to be done through unilateral debt default but requires the ECB to play a central role. Under the proposals, the ECB would buy up the excess debt and convert it to zero-coupon bonds which would ultimately be paid back by governments. This includes a five-year grace period (a moratorium) on debt repayments. It is obvious how Ireland would gain dramatically from this.

Our debt would be more than halved from 108% of GDP to 50% and interest payments would fall to just over €3.5bn. If interest payments were suspended for five years, that would leave us with an additional €7.5bn per annum.

At a macro level, the euro, ECB, and EU are in danger of falling apart. They have become a corporate and financial superstate imposing the will of the wealthy core countries on the poorer peripheries. The cost of the bank crisis and recession was disproportionally paid through austerity by the populations of Ireland, Greece, Spain, and Portugal.

Syriza’s plan would be a major economic stimulus and act of social solidarity for Europe and Ireland. Rather than distancing us from these proposals, the Irish Government should stand up for ordinary people suffering across Europe and offer Ireland as the venue for the European debt conference.’


@The Second

‘In fact the great majority of the EZ club support the German position …

Minor point:

In fact the great majority of the EZ ‘ELITE FINANCIAL’ club support the German position


methinks you might have a touch of ‘The Conflationist Fallacy’; a good bit of it going around …


Absolutely, the Greek shinners have stated that they want to stay in the Euro, and that’s not just being politically diplomatic, they know as well as everyone else that Grexit would be an utter disaster for the Greeks.

But they can’t have their cake and eat it, which certainly seems to be the shinner program, so they may find themselves escorted to the exits – heck they only represent 2% of EZ GDP and an example may have to be shown to other much larger potential cake eaters.

They will probably find some route back to Frankfurt’s way; they are possibly consulting Eamon even as we speak.

@tull, @docm

Have you looked at the charts in Krugman’s post? Any comments on those? EU/neo-lib economic policies have been thoroughly discredited. It is time to give the alternative a chance. Samaras did everything the troika asked. And Greek debt/GDP ballooned from 130% to 175%. With friends like these…

@Joseph Ryan: Fantastic point about German debt relief after WWII. As MH often says: Eaten bread is soon forgotten.
Evidently the Germans are as culpable as the Irish on this count.



Welcome back!

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I can’t believe the EZ is in a state of deflation and the Germans are accusing the Greeks of economic incompetence. Deflation is like self defecation for capitalists.

geddon regularly predicted on this blog came to pass. The possibility is certain to have a salutary impact on public opinion in Ireland. There is no such thing as a free lunch.

@ Garo, JR

The comparison with German debt relief after WWII is so wildly irrelevant I wonder why I bother to address it.

The Greek shinners have invoked this comparison, trying to weave a moral tale into the matter. But the situations are oh so different. From an economic point of view Greek debt forgiveness raises so many issues of equity, contagion and moral hazard. Forgive them now and they will simply blow it all again – indeed the shinners have promised to do so. No such issues arose in 1953.

Greece has already had one default and ðebt service costs are 4% of GDP so a haircut is not going to deliver much. Their problem is that they cannot organise an efficient tax system or spend money in a non corrupt manner. Tsipiras is not going to change that or even try. He has just blown the primary surplus by raising wages and rehiring public servants. How is he going to pay the salaries when they fall due?
Ultimately, Geeece has to leave, devalue, default and try to rebuild an economy over a generation. Either that or Europe has to pay for their extravagant lifestyle for another generation. Can’t see that.

Tull, Tspiras and his finance min have been pretty vocal about internal reform. They talk about improving tax collection from the oligarchs and the Swiss account holders. So you are completely off base. The interest payments may be 4% of GDP but with deflation nominal growth will remain below that so the burden will be not payable.

I don’t think comparisons with German debt forgiveness are off base at all. Please explain why you think so.

The economist Eric Janszen often observed on his blog that episodes of default and hyperinflation are often preceeded by the governments involved burning their bridges with geopolitcal allies. If only for the simple reason that countries with strong alliances tend to get “looked after”.

The overtures being made by Syriza to Putin are interesting (http://www.ft.com/intl/cms/s/0/b9ecfeb4-a646-11e4-89e5-00144feab7de.html#axzz3Q43ekdOP). On the one hand, Europe is trying to keep Russia out of the Balkans and might be willing to pay for that. On the other hand, if Syriza are serious, then they are falling into the pattern of a government headed to default and exit from the EZ.

The comparison with the 1930s German default is not off base. In fact it is spot on. That undoubtedly released resources which enabled the NSDAP to reload and rearm.
The 2nd one in the 50s is less clearcut. Germany benefitted greatly from that and would not be where it is without it.
I suspect Tsipiras is closer to version 1 than version 2. A dysfunctional and incompetent bunch who will drive capital and money out of Greece, do nothing to reform and roll back what little has been done.

It takes two to tango.

Idiotic banks, insurance firms, pension funds etc lent Greece a boatload of cash. Did they do due diligence? Of course not, but they were clever enough to dump theses bad loans on European taxpayers. Idiotic politicians (e.g. Merkel) facilitated transfers from bankers to taxpayers. And the Irish politicians followed orders and took on some 350 Euros of this bad banker debt. What dopes.

Suck it up folks. Your financial institutions made ridiculously bad decisions 10 years ago. Your governments took these bad loans on to their books 4-5 years ago.

Suck it up, the money is gone.

Deal with it.

@ Garo

“Tspiras and his finance min have been pretty vocal about internal reform. They talk about improving tax collection from the oligarchs and the Swiss account holders”

Isn’t, like in so many countries, the biggest issue around reform and revenue raising the effective and fair taxing of the middle and working classes, rather than chasing more mobile and often mythical oligarchs? Tax reform (both levying and collecting) in Greece is as much a problem at the lower end as it is at the higher end. Greeks have become so cynical about the political and economic system (again, at both ends) that they have socialised the idea of not paying tax. Greece’s problem is that people don’t want to pay taxes due to (a) selfish personal reasons and a (b) genuine belief the money will be wasted and (c) a genuine belief that no one else will pay. Its a chicken and egg game to fix that.


the absence of growth across Europe is a big part of that. You can ask people to sacrifice if they think there is a point to it but deflation is very hard to sell.

2 of the key memes of the FT are

1. High quality x requires investment
2 how to spend it

Neither of these concepts are a focus in the EZ at the moment.
Demand is down. The rich are hoarding assets and nobody is investing

the Euro Stoxx index had 11% earnings growth last year almost entirely due to cost cutting.

This is a system issue. Much bigger than Greece.

I don’t get why so much of this conversation is about Greece. The problem is not with Greece, they are like any other country – struggling to sort out a fair and sustainable way to pay for public services. They haven’t been very successful recently but there is no reason to believe they won’t sort it out eventually. That may involve lower living standards but the quality of life of Greek citizens will still be better than that of other EU countries that we don’t weep about. What is the GDP per capita of Romania or Bulgaria? If there is money sloshing around to boost living standards then why aren’t we sending it there? Or why not send it somewhere that really needs it – Chad, Congo?

The real problem is with the lenders – this whole mess has always been about saving them from their own mistakes. There is no genuine desire to see growth in the Greek economy, there is just a desire to ‘get our money back’.

@ Seafoid

“the absence of growth across Europe is a big part of that.”

Sorry, are u claiming lack of growth is a reason people won’t pay their taxes? How do u explain the 20 years of pre-crisis Greek tax policy? The fact is that while no one really likes paying tax, most of us resign ourselves to being forced to pay it. Greeks seem to think differently.

Things are only starting to get interesting.

2015 will contain several chapters of the European Saga.

Chapter 1……Greece and the developments of the new government.

Chapter 2……UK…7th May General Election.

Chapter 3……Spain..General Election either in October, November but before December 20th. Currently the Anti Austerity Party is polling strongly in 2nd place.

Chapter 4……Ireland, bit of a wildcard, GE either this year or in 2016, but a unworkable motley crew of socialists / anti austerity politicians displacing the mainstream parties.

Traditional mainstream parties are being eroded as voters become more dissulsioned with their performance.

Even those who have jobs are facing poverty in retirement. The future is not rosy.

Much comment has been given to Greece, and if it does depart from the Eurozone it will not have much effect, the risk of contagion is reduced due to all the hard work over the last 3 years.

I disagree.

Take a look at Greek Financial stocks… there is a currently a run for the door by investers, Eurobank falling 20% alone this morning, Pireaus Bank down 23%.

Take a look at Bank of Ireland stock price on the ISEQ…. again falling. I believe that as Investors flee Greece, it will have a knock on effect with the other PIIGS.

It is entirely possible that by the end of 2015…. Irish property prices will be lower than in 2014 as investors run for the door.

Interesting times ahead!!


The lack of growth and deflation are behind a lot of the current mess. Nobody seems to have done anything well.

Greek unemployment is 26 per cent with youth unemployment over 50 per cent. That’s a fair bit of lost tax revenue

Martin Wolf:

“the loans supplied by the eurozone and the International Monetary Fund amount to the huge sum of €226.7bn (about 125 per cent of GDP), which is roughly two-thirds of total public debt of 175 per cent of GDP.
But this went overwhelmingly not to benefiting Greeks but to avoiding the writedown of bad loans to the Greek government and Greek banks. Just 11 per cent of the loans directly financed government activities. Another 16 per cent went on interest payments. The rest went on capital operations of various kinds: the money came in and then flowed out again. A more honest policy would have been to bail lenders out directly. But this would have been too embarrassing.”

But yeah, it’s all because the Greeks are lazy

@ Gavin Kostick

Thanks for link to Karl’s piece. As always I disagree with Karl’s view that NCBs can be allowed go bust with no harm to anyone.

It is true that if, say, the Irish CB buys up a lot of Irish sovereign debt, the net national balance sheet will have less outstanding on these bonds. The difference of course is filled by debt to the Eurosystem.

In theory, then if the government wanted to save money by default on its bonds the default will have to be deeper as there are fewer in external hands. So yields might go up.

Maybe its the way Karl tells it but he seems to suggest that this phenomenon is because we don’t care about defaulting on a our CB. In theory that is of course true but the real issue here is that we would need to default to the Eurosystem to fill the hole left by the vacuous default on our CB.

@ Sporthog

Very good analysis. In the UK Con+Lab can only manage about 55% of people polled . A lot of UKIP voters are the ones getting saddled with the losses/reform and are very afraid of the future.

And your scenario assumes the US will be stable. Which I wouldn’t bet a Dublin house on.

@ Seafoid

“!But yeah, it’s all because the Greeks are lazy”

I never said the Greeks were lazy, and its slightly insulting of you to them to just throw around casual suggestions that that’s what people are saying. I said the Greeks have a cultural aversion to paying taxes due to a generation or two of mild corruption in government, easy ways of not paying taxes without much fear of being caught, a general belief that any taxes you do pay will either go to waste or that you will be the only one actually paying the taxes. So this isn’t about a misaligned Greek tax wedge that can be fixed by simply closing loopholes or creating an upper band. It is about reversing decades of a cynical and now ingrained attitude towards the idea that not playing by the rules is the best way to play the game. Greeks have a lot of people to blame for their current mess, but ultimately a huge amount of it resides with themselves and their political elites.


I don’t think I could agree that:

“To summarise on this topic, there is no particular need for governments to recapitalise central banks and, if they had to do so, it would on net be costless. So the idea that it is impossible for a government to default on a central bank (and thus QE increases risks for the private sector) does not hold.”

I am assuming that most analysts regard any extent to which a default to CB exceeds its capital buffers as a remaining liability of the state whether it results in a recap or continuing CB technical insolvency (or ‘insolvency’ if you prefer), and therefore a part of the government debt that could not be eliminated from market participants’ calculations about post-default debt levels. This would be particularly so in the context of comparative credit quality analysis within a monetary union in which other states did not have a comparable liability. If you default on enough debt then the post-default debt levels, even including those to the CB, will be low enough that new investors will be relaxed about the liability to the CB anyway, but that implies the old investors taking a bigger haircut.

That, of course, in itself ignores the reputational cost – something which can vary from trivial to prohibitive, depending on sentiment at the time.

Sentiment right now is such that discussing this stuff is just academic – nothing is being priced on it – because defaults are not expected on QE purchases.

With respect to the apparent vagueness about how the 25% issuer limit will affect Ireland, given all the printing its central bank already carried out, arguably under duress, I would imagine a negotiation on this would have been concluded prior to the ECB approval of QE as it was noted long ago on here and probably elsewhere:


This CIGI (the Canadian backed Centre for International Governance Innovation) paper gives a blow by blow account of events.


The author is Greek with insider knowledge of the matter. What she fails to detail in any way, however, is the failure by successive Greek governments to actually introduce the bulk of the structural reforms which would have helped turn around the economy and with it make the country’s debt burden sustainable. She simply adverts to it. This oversight undermines her general conclusion that the current policy is one of “extend and pretend” and doomed to failure. The question will be answered not by the performance of the Greek economy under the new government but by the performance of the other highly indebted ones, Ireland included.

Martin Wolf would also find the paper informative.


If there is a failure in statesmanship, the bulk of it must surely lie in Greece.

As to morality, if it applies to creditors it must apply with equal measure to debtors. In fact, it applies to neither other than to the extent that both, one or the other, or neither abide by lawfully concluded contracts.


Any sensible suggestion I have seen about how to deal with Greece suggests debt writedowns subject to reform which would include tax.
This failure has many fathers and one mother. Tax is a part of it alright but not the only part.

The last bailout was a joke too.

Trichet’s “save your banks” has brought us deflation.
That doesn’t seem to be priced into sovs either.

@ ufc

I was making the same point put your quote from K’s paper emphasises to me that K misunderstands the argument that QE could increase the risk to the private sector.

It is precisely because a government defaulting on a liability to its CB is a null event that the benefit from any default would have to be geared up on those remaining private holders of the bonds.

Obviously CB holdings of government bonds are self cancelling at the national level and that is with or without default. What QE effects is a switch from government bond liabilities to the private sector to money liabilities and the latter will in practice rank higher than the former in any default scenario. And of course the CB and ergo the government is on the hook to the Eurosystem for these money liabilities.

In summary, QE pushes private sector bond liabilities down the pecking order.

@The Second

“The comparison with German debt relief after WWII is so wildly irrelevant I wonder why I bother to address it.”

The purpose, in 1953, was a prosperous Germany, ergo debt relief.
The purpose, in 2015, seems to be to humiliate and destroy Greece, hence no debt relief.
The comparative issue is highly relevant.
The fact that the 1953 beneficiary is the strongest opponent of relief in 2015 says all there is to be said about European ´partners´.

As to where the 240 billion bailout money went, over 200 bilion went to bail out bondholders (ref post from Seafoid above). That makes the bondholder bailout issue about five times bigger in Greece than in Ireland.
Think about it!

The logic of the late Peter Mair’s analysis is that, as originally constructed, the European project was deliberately designed to exclude the elements of ‘popular’ democracy. As it has expanded and evolved into the present range of competencies and 28 member states, increasingly it creaks under the weight of a lack of popular legitimacy. In theory, each member state is as equal as the next. In practice, some states (the larger and more economically powerful) are more equal than others (the smaller member-states).

The problem for the new Greek government is whether, realistically, it could force an EU policy change on debt and austerity issues without an effective alliance with other like-minded eurozone member states, including at least one large founder member-state. Right now, Greece belongs to a ‘Club of 1’. There is uncertainty, despite the rhetoric of Prime Minister Tsipiras’ victory speech, that the tsunami of electoral triumph of left-wing anti-austerity parties will reach as far as Spain (Podemos) or Ireland (Sinn Fein). In any case, by the time it did, it would be too late for Greece. Even if all the excessively debt-encumbered states formed their own bloc to challenge the current policy direction, it would hardly be enough.

Given the way the EU functions, each member-state, including Ireland, can be reliably expected to look to its own best interests first. Also, as Mair convincingly demonstrates, democracy at national level has moved away from its traditional representative mass party base to a form of ‘audience democracy’, in which citizens are more spectators than participants and electoral support is increasingly volatile. Ironically, at transnational level, this makes national political leaders more vulnerable to populist demands of ‘shouty’ minorities at home, rather than conferring them with the freedom to make decisions they might latterly defend to an ideologically loyal constituency or by appealing to general moral or altruistic values within society.

For the Greek government, the extent of their influence on what happens next rests on ‘interdependence’ within the eurozone; more specifically, the risk of contagion. Thus, relative influence will depend on the extent to which the EU institutions, particularly the bloc of creditor states, perceive a risk to themselves and the EU project itself, if there is a failure to resolve the Greek situation satisfactorily.

As for arguments about whether Greece is bad at tax reform, or even collecting taxes in the first place, or whatever; I honestly think that’s all a bit of a sideshow. In the long run, the current EU model of austerity policy doesn’t work for Greece, or for any other eurozone country for that matter. Its social costs are too high. Besides, when it comes to structural inefficiencies, inequalities or lack of political capacity, it never does to delve too deeply into the supposed deficiencies of any one state. Like Tolstoy’s unhappy families, each state is ‘unhappy’ in their own way.

Reality bites!


sceptic01 at 11.28 above asks the really pertinent question. If the primary surplus is to be used to reverse steps required by the Greek assistance programme, the implication can only be that Greece is heading for the exit.

The policy advocated by a variety of Irish politicians, academics and commentators is now being tested in real time by Tsirpas. I suspect that the implications have not been thought through in Greece any more than they have been the advocates in Ireland.

The author from Maynooth seems to miss the point that after the ECB finishes buying its quota of Irish debt, CB will own close on 30bn or Irish sovereign debt & that is just short of 20% of GDP or an even bigger percentage of the GDP number without the MNCs. That puts us at 90% and falling as cash balances normalise! the AIB stake is sold.

Why would we even bothe to associate ourselves with the Greek coalition of ex commies, PUtin fans and racist semi fascists.


Somehow I can’t quite get my head around the notion of the ‘Farmleigh Accord’ of 2015!

@ Tull

we’re already approaching 90% net debt to gdp. If u start to put a major discount on the true value of long term CB holdings, it means the Irish economy will effectively be running off a real net debt to GDP of around 75% or so for the next decade. This fact both astounds and terrifies the lefty perma bears out there.

good to see you back in the parish.

The lefties out there fail to grasp that we are now owed 365m by Greece and a re now doubt on the hook for a few bob more through our share of the ECB etc.
They also owe money to even poorer nations in the EU. We have zero interest in lining up on their side.
So the idea of giving an unconditional debt write down to a bunch of national socialists and fascists is politically unacceptable. However, I am realistic to know that this is the EU and there is a bid offer spread on the deal. My bid is zero.


The trend is so good- down to around 75% of GDP- surely that’s worth another 200 bps off the 10 year

Just wondering if some of your clients aren’t seeing deflation rather than Shangri la.

@ Veronica

Super post. There is a lot of wisdom in your contributions.

Re the shouty ones I think we should try to understand those who feel they have no other way to express themselves. And we have to look at everything in the framework of political economy. Because this is ultimately driving what is happening
I didn’t bother with links because I can only get 3 per post…

As Suzanne Moore said about Scotland

“It may well be fierce, shouty and messy, but these are undeniably voices from below and we should listen.”

1. A comment re Greece but with wider relevance

There is no “turnaround” plan to achieve growth and employment. It is a goal that cannot be endlessly subordinated to “rules.”

As an example- Renzi in October

“I prefer to have a France with 4.4 per cent [deficit-to-GDP ratio] today than a France with Marine Le Pen tomorrow.”

2. The crisis is about allocating the losses.

Who gets them? Disproportionately poor people. Bond holders whine but are better organised, as are retired people. The pain falls on weaker sections of the general population.

Paul Mason “:The key to riding the storm, as elsewhere, will be who is made to shoulder the burden of falling income and reform.”

UK :

“With weakness in tax receipts set to increase the size of the deficit by £25bn during the next parliament, the OBR said the only way Osborne could balance the books would be through shrinking the state to a level not seen since before the Second World War.“Total public spending is now projected to fall to 35.2% of GDP by 2019-20, taking it below the previous post-war lows reached in 1957-8 and 1999-2000 to what would probably be its lowest level in 80 years”.

This is because he made the wrong calls on deficit reduction because salaries were stagnant and tax receipt fell. So it’s a vicious mix of elite incompetence and popular distrust of elites claiming competence.

Douglas Alexander, head of Labour’s No campaign in Scotland, said in October : “Structural changes in the economy, meaning people are harder up and still feeling left behind, are combining with alienation from party politics to shape the political landscape.”

He talks about “the imprisoning cynicism towards politicians and political parties”.

3. Fear

UKIP memes are aimed at an electoral subgroup that fears Britain and the life they know is changing and there is nothing they – or the mainstream politicians they once elected – can do about it.
Polling suggests that UKIP voters are very afraid of the future.
I would hazard a guess that FN voters in Provence feel more or less the same.

4. The breakdown of the old Left/right cosiness

Before the 2008 financial crash, mainstream centre-right and centre-left parties were polling 70 per cent across Europe; since the crash the average has been 55 per cent as populist parties fed off the public sense that mainstream politics had failed.

John Harris
“We should also wave goodbye to the notion of politicians as lever-pulling strongmen, and some magic formula whereby leaders might affect – à la Blair or Thatcher – to speak for a majority of the country. It would take a book or two to satisfactorily explain why, but the basics are simple enough: the demise of organised capitalism, the fragmented, atomised economy that took its place, the way that technology feeds a culture of scepticism, and the resulting disappearance of the kind of voter who goes to the polling station feeling a compelling sense of party loyalty”

5 Precarity

“The latest statistics show that since October 2012, 833,628 individuals have received an average of 1.73 benefit sanctions each. From April 2000 to June 2014, a total of 3,063,098 people received an average of 2.04 sanctions each. Almost 60% of sanctioned individuals received only one sanction, but 21.5% received more than two, and 46,000 received 10 or more. A Commons select committee is conducting a fresh inquiry into the sanctions regime.
The report also points to the way in which the cost of food, fuel and rent has increased since 2003, in a trend unprecedented in post-war Britain.
Field said: “These fundamental changes in the relative prices in budgets of food, utilities and rent haveblown sky-high the comfortable post-war assumption that our wages system and our benefit system guarantees a minimum which most of us would regard as tolerable.””

“Between 2011 and 2014, the number of people receiving trussell trust food parcels jumped from 128,697 to 913,138.
The DWP did not comment on the specifics of matt’s case but says sanctions are only used “as a last resort in a tiny minority of cases”

UKIP voters see that and know it could be them.

6 Immigration – which along with debt was one of the drivers of cheap economic growth but now works in the opposite direction by keeping salaries down thus being one of the drivers of deflation.

7 Changes in the model of capitalism that hit middle class assumptions about stability

“But now the retail business model is to turn over cheap stock fast to customers with not a lot of cash and a bottomless yearning for something new. The clothes are made in sweatshops in Bangladesh or Mexico, the warehouse staff are on zero-hours contracts, and the shop workers are on the minimum wage. The M&S mid-market recipe of good value and nothing too scary works brilliantly with food, but it’s a dud in fashion. The winners belong to the globalised economy”

It is very complex. Without economic growth the challenges are huge.

@ Veronica

Syriza’s hand will indeed be greatly strengthened by a Podemos victory in Span, if Syriza can hold it together til the Spanish elections. Any concessions made by the Eurogroup now will help Syriza stay the course and also increase the chances of Podemos victory. For these reasons it’s likely the Eurogroup will offer little or nothing, and it’s also quite likely that Syriza will accept – under protest, with a view to revisiting after Spain votes. They can defuse accusations of a sell-out by not implementing any agreed conditions.

It’s also possible that Syriza will simply lose control of the situation and be forced into a default before the Spanish election comes around, an outcome that the Eurogroup might prefer to the alternative of bailing out Syriza’s revolution.

“Even a daft government with daft policies needs a functioning banking system.”

Functioning banking system? We did have that – remember? But daft policies promoted by the (then) functioning banking system and enthusiastically implemented by our politicians, steadily diluted, then finally disposed of all those prudent banking laws and rules. And now? Well, we do have a speculative banking system. But is it a functioning system?

Deposits? Who need deposits when you can whistle-up all the credit you need – just enter the needed digits into an electronic balance sheet – “Job’s OxO! What’s the usual leverage now? 50:1 or better?

” …. national political leaders [are] more vulnerable to populist demands of ‘shouty’ minorities at home …”

Apparently, these days, the real ‘shouting’ is piano in character, is conducted indoors and is very ‘hush-hush’. I think its called “lobbying”.

One of the biggest practical problems Syriza will face is that the European right (which effectively includes DG-ECFIN and the ECB) is determined to stop them. Germany, the Netherlands and Finland have come out with thinly veiled threats while every third sentence from a European Institution contains a reference to adhering to commitments and continuity of policy (the EU dream, new boss, same as the old boss). Syriza’s daring plan is to try and exploit division between the domestic political concerns of the Deutsche bloc, the ECB’s urge to protect the financial sector as a whole and the European Commission’s need for progress in other areas (which Greece can block) to force a realignment and out Bismarck Merkel.

Meanwhile the right wing press (and Internet commentariat) is filled with cries of derision and paranoia – you can fully expect the media campaign against Syriza to go dirty (espionage dirty) in the following weeks. Many paragraphs will be written on Syriza’s lack of experience (which translates to “not part of the club”), unrealistic expectations (expecting change of any kind) and lack of commitment to freedom (US foreign policy).

The concerted (soon to be orchestrated) campaign against Syriza has one big problem. The stench of fear it gives off.

Syriza’s introduction of public disagreement (dissensus as Aidan Regan would have it) can not help but remind the voting publics of just how badly the politics of austerity have failed and of how these policies continue despite widespread opposition. The right knows that if Syriza is not destroyed (or better subverted) they could lose control of the European project.

Welcome to the opening days of European Class War I

@ Tull
Thanks. The post reflects my current interest in policy making processes; the ‘why’ as much as the ‘how’ of politics at elite institutional level. Any encouragement is much appreciated!

Unfortunately, Peter Mair was not given the time to develop his argument on what could, or should, replace the’ hollowing out’ of the traditional model of representative democracy, as he saw it. Following Manin (1997), it can be conceptualised as a ‘crisis of adaptation’. If there’s one thing representative democracy is good at though, in Manin’s view, it is in adapting to and accommodating social, economic and political challenges, even through periods of substantial social dislocation and unrest .

I think it is generally accepted that the politics of austerity, as it has been practised in Ireland and elsewhere, poses a threat to the continuing health of representative democracy. In our case, it’s not just that parties developed the habit of making election promises and then gaily abandoning them. Nor even that the auction of promises for immediate electoral advantage in the 2011 general election was subsequently exposed as just that. It’s that in the meantime, the principles of representational politics, implicit to the ongoing connection between parliament and public throughout the electoral cycle, appear to have taken a walk as well.

Right this minute, I’m listening to an RTE report on the latest launch of the ‘Action Plan for Jobs. Now in its fourth iteration; this time promising ‘full employment’ by 2018. All very good stuff, I’m sure. There are even some heartening examples of Irish entrepreneurial success. But why do I have this sense of being underwhelmed? That this entire razzmatazz is more froth than substance? That I am being patronised rather than enlightened? If we’re going to live in an audience democracy, and it’s going to continue to have any meaning to our lives, those on the ‘performance’ side of it also need to deliver.

The right to protest, and the importance and value of public protest to the development of a healthy, properly functioning democracy, has been recognised since ideas about representational democracy were being bandied about in the 18th century. Protest, civil disobedience, and even the occasional riot, are necessary to deliver a signal of what’s gone wrong; of policy failure and legitimate demands for change. The rights of protest and of freedom of speech provide much-needed wake up calls to the political elites. Suzanne Moore is spot on. ‘Voices’ must be heard, and listened to, however much that may afflict the comfortable. But there’s a difference between popular mobilization against policy failure or in favour of desirable policy change, and populist manipulation of public unrest or unease for narrow, political, self-interested purposes. I think it’s important to remain vigilant as to the distinction between the two

Time is not on the new Govt’s side in Greece.

According to Bloomberg Greek 10 Year bonds above 10%, 3 year bonds above 16%. Effectively they are now cut off.

S&P already considering a rate cut as of yesterday.

In addition various loans have to be paid back in February and March / April.

The squeeze is on!

One aspect of the Greek saga is the fact that it is not legally possible for a country to quit the euro without also leaving the EU, as the President of the Commission has (helpfully?) pointed out in an exclusive interview with Le Figaro. (He also hands out a few brickbats to France).



I am no fan of bankers. Maybe I should have put more emphasis on the word “functioning”. In short, it is impossible to imagine a modern economy working without such a banking system, no matter what view one holds of it. This is the stark reality that confronted the then government on the night of the infamous guarantee.


Welcome back! Your voice has been missed.


One person’s “precarity” is another’s “structural reform.”


So the left will discover that the media and financial worlds are engaged in a vast right-wing conspiracy? I can’t imagine that!


Interesting last para. Germans want a strong currency and no risk sharing. If that is true, then there can only be on logical conclusion. The Germans and the Greeks must leave. Neither has a terrlbly good track record of governance in the long term.

@ DOCM: Got that from 29th. Thanks – again. Posts are v-slow in being updated.

I’m just a little (as in teensey-weeney!) skeptical of ‘banks’. I remember a 10 week bank closure – and the sky stayed up there. However, our contemporary lot are simply a pride of financial predators – they select and hunt down the weaker debtors. Makes sense.

The financials went ‘rogue’ – not overnight, but over several decades. And essentially have caused serious and on-going problems for our economies. And, no one with the necessary authority seems to be willing to fix the matter. A matter that was effectively ‘fixed’ by 1933 or 1934. Hence, one of the first tasks of our elected reps is to re-fix the financials – if they can.

Pandora’s Box comes to mind.


Who says?

One could argue with a great deal of justification that the crisis in Greece makes it unavoidable that the country finally gets its governance act together in the same manner as number of other countries – Ireland included – are doing. Lectures from the governor of the Bank of England who, seemingly, did a better job in his native Canada than he is doing in London, do not contribute much. I was not aware, for example, that Canada had embarked on a massive round of QE and can see no parallels with other countries; only the lesson that they should have followed its conservative economic policies. In any event, the euro is a sui generis construction and is certainly not going to disappear which it would, of course, were Germany to leave. The interest of the UK is to defend the role of the City of London and to ensure that it remains in a dominant financial trading position; especially if a true euro capital market develops.

I used the word “daft” to describe the approach of the hew Greek government in the sense of distance from reality. There are clear signs that this distance is rapidly narrowing.


Greece has also fallen into line on the issue of EU policy vis-a-vis Russia. There is clearly too much at stake for the other major participants for much further pussyfooting around.

@ Gregory Connor

The one thing that can be said of Krugman is that he does not have a low opinion of his own judgement. Does he expect the taxpayers in other countries to pick up a still steeper bill for the debts incurred – and the money largely expended – by their opposite numbers in Greece? To the extent that the latter have paid any taxes e.g. the owners of the biggest commercial fleet in the world who are largely exempt; or the holders of vast sums in Swiss bank accounts.

@ GC: Re that PK piece.

I do not think that there is anything new or even different in what PK is writing about that has not already been written about on this site – many times. So, at whom or what is he directing his comments toward? The politicians know they are correct – and have re-election as their only objective. They will not move. The financials are so consumed with their own importance that they will ignore or dismiss any critique – howsoever valid that critique may be. The ordinary folk are almost powerless. So what is all this reform guff? Reform of what? The actual question is HOW will any reform come about. Answer: it will not – absent a lot of stones in the air!

“Greece has actually made great progress in regaining competitiveness; wages and costs have fallen dramatically, so that, at this point, austerity is the main thing holding the economy back.

I simply do not ‘buy’ this. If wages and salaries decrease; how does this translate into an increase in state revenues? How does a reduction in consumptions ’cause’ the Rate-of-Growth to accelerate? Competitiveness: compared to whom? To what? Are we back to invoking Magic Multipliers? Or being led by an Invisible Hand? Or should that now be a Robotic Arm – in neo-contemporary, economic jargon?

Austerity – or whatever you want to call this much misunderstood, misused and regularly abused economic term, is not and never was about economic ‘growth’ or ‘recovery’. It was and is always about financial predation by politically protected creditors against weak debtors (those unable to repay loans). And it has, so far, been a heroic success – if’n you can regard failure as a success. Seems a lot of folk do.

@ Ernie

One man’s structural reform is another woman’s hung parliament and jump in gilt yields. Innit.


Finance has lost the plot. Saw there in Lex recently that “UK companies enjoy many of the tailwinds that European companies enjoy: minimal wage growth and falling oil prices”.

This is WTF Gold

Eurostoxx earnings were up 11% last year based on cost cutting. Sales grew by 1%. Sales growth for the S&P 500 has been stagnant over 4 years.
Minimal wage growth is like deleveraging -ok for one but impossible when everyone does it. Because it leads to deflation.

I met an unfortunate in a homeless shelter in London once who had been given a furnished flat. He came back about 3 months later looking for new furniture. I asked him what happened the furniture he had been given. He said he feel behind on the electricity so he burnt it.

I thought it was pretty stupid but I didn’t ever imagine Lex topping that.

@Ernie Ball

Thanks Ernie.

I am still a regular reader of the IE but it’s been a long time since I felt that the same ground was not being gone over and over again and long after the argument had been settled by the facts.

It is a microcosm of the EU. At the last Eurogroup press conference Dijsselbloem (a social democrat, in Dutch terms) announced that the Eurozone needed to stick with “growth enhancing fiscal consolidation”. This is a settled argument and all the creditor countries and DG-ECFIN are on the wrong side of it. The lunatics (gold bugs, austerians, Schäuble) are running the asylum. Yet legal and political structures in the EU (not to mention instructional political preferences) are soundly behind the lunatics it is hard to see any way to resolve the problem without first having a serious rupture so that the political and institutional structures can be rebuilt.

Which brings me to the main reason I tried to post again – Veronica’s terrific posts above on how the European project as is is incompatible with the requirements of representative democracy at a national level (or “populism” as it’s increasingly labeled). This is serious stuff and the solution to the EU’s problem of technocratic rule and the dominance of elite interests may not be democratic or peaceful. We are sleepwalking here and continental Europe has bad form on this front.

Lastly, on topic, if you are looking for Ireland’s Syriza the closest thing we have at the moment is the Right2Water (sic) movement against Irish Water and water charges. The only thing likely to make Ireland’s establishment reevaluate their loyalties between the EU and the electorate is a a humiliating and expensive climbdown and the end of many careers in the elected and permanent governments. I believe there are marches this Saturday.

It’s one thing to have the EZ in a mess but the US headed there as well – I think 2015 could be very , very volatile

Growth for the US for 2014 estimated at 2.4%
That is desperately poor considering how much the Fed has pumped into the bank accounts of the rich.


“US gross domestic product expanded at a 2.6% annual pace after the third quarter’s spectacular 5% rate, the Commerce Department said in its first GDP snapshot today”

Remember, Q1 growth was -3% due to climate change.

QED – QE is dead

I bet the non farms will be crap as well with SFA in terms of salary inflation

The Yanks were able to produce good stuff a long time ago but they seem to have lost the knack



The real problem with Krugman’s suggestion is that he wants the ECB to continue providing unconditional support via the back-door to Greece in the event of a default. It would be better for those who want unconditional support to make their case in public and have it voted on by finance ministers, who can then be held to account, either way, for their decisions.


Greece remains much richer than most of its neighbors. Its gross domestic product is $22,000 a person. Albania’s is $4,000, Macedonia’s $5,000. In Bulgaria – like Greece, a member of the European Union – it’s $8,000.

A good point. The reason Greece is by far the richest country in south-east Europe is that between 1945 and 1990 it experienced capitalism (more or less), while the others all had socialism forced upon them. Better the Greek colonels (bad though they were) than the likes of Tito, Hoxha, Cauesescu, Dmitrov and all the other tinpot marxist buffoons who kept the countries of that region in poverty, while Greece prospered. Je suis Aristotle Onassis.

The problem is that Greece is now run by a collection of tinpot Marxists, academics and right wing fascists. It is a gift that will keep giving. The most recent is a quote form the Foreign Minister back in the day criticising the Polish commies for being too soft in Solidarnosc.
In Ireland, these lads appear to have a fan group stretching from the Shinners to through the commentariat of the IT to Shane Ross.


Those hysterical rhetorical flourishes really don’t strengthen your case (whatever it is supposed to be). The lady doth protest too much, methinks.

@ JtO: ” …. between 1945 and 1990 [Greece] experienced capitalism (more or less), while the others all had socialism forced upon them.”

Experienced? Forced? Well, as Dr Einstein said – “Its all somewhat realtive!”

Just try and remember that capitalism and socialism are two individual passengers on the Permagrowth tram. Its the tram, John – the tram, that is not functioning so good at the moment.

I’ll pass on your characterizations of the Colonels and Marxist buffoons. Bit Einsteinian. Would one compare or contrast Mao and/or Stalin?; Franco and/or Salazar?; the bloke in charge of the Third Reich and/or Benito of Italy?

Jeeze, Tull. Ease up. We still have Nigel and Mm Le Pen to think about.

Now our SF is a completely different political animal. They did come to power through a real shooting and bombing civil war. How many murders? 2000+? How namy hundreds of millions of private property was destroyed? Worth watching our SF.


Indeed, your delirium regarding the new Greek government (“right wing fascists”? really?) reminds me of nothing so much as the American Tea Party rhetoric according to which Barack Obama is a Marxist National Socialist but also a moron completely overmatched by the job. The effect of your rhetoric when contrasted with the following interview with Yanis Varoufakis is much the same:

Varoufakis is hot-footing it to Paris today rather than Monday, no doubt, trying to create some sense of order before the banks open on Monday. Merkel has very publicly said no.

A tough call for the French MOF. And the ECB in the matter of liquidity assistance. The problem for Tsirpas may be that to restore some order, he may have to eat some humble pie. Or Varoufakis sees the light and does it for him.

The WSJ on the wider considerations; and the possibility of a deal, assuming events do not run away with all the parties.


I’ve tried to post on this site three times in the past 10 hours. Each time, the post disappears into the ether. Have I been ‘banned’? If so, could I please have an explanation?


I wouldn’t be too confident that Tsipras will eat humble pie! Normally I wouldn’t overpret interview comments, but I think it’s worth noting that Tsipras said he would repay the IMF and the ECB. No mention of the Eurozone governments. The IMF and ECB together hold 16% of the debt and it’s definitely in his interests to pay them, regardless of what happens with the rest. Likewise if I were a Greek creditor I wouldn’t take much comfort from his stated desire to avoid unilateral default or to “do what is best for Europe” – very much subject to interpretation!

The Greek weak link is the banks. Any hint from Draghi that it the ECB cannot roll over liquidity or the local central bank cannot increase ELA because collateral is no longer acceptable and it is good night.
Depositors would be haircut as in Cyprus in these circumstances.
I agree with your other point that it is too early to determine what the new Govt end game. They are all over the map.


Tsipras / Varoufakis is a good cop/bad cop double act. Tsipras is simply expressing his optimism that Europe will agree to his terms (by all accounts he is a very optimistic and confident guy). Varoufakis is meanwhile trying to create the conditions that might bring that about. Their activites do not seem inconsistent to me. Bloomberg’s take:


Very accurate reporting. He’ll repay the ECB and IMF, but he’ll “reach a deal” with EU

“The problem is that Greece is now run by a collection of tinpot Marxists, academics and right wing fascists…”

For the past four years, Greece has been run, into the ground, by a collection of gungho neocon lunatics, all on behalf of the new ‘Europe’.

They promised a 5% reduction in Greek GDP, they achieved a 25% reduction, with 25% unemployment, over 50% youth unemployment and a 40% reduction in domestic spending. All in just four years! Wow.

Imagine if they got their way for another four years. Greece would be disappeared behind a barbed wire camp.
The Eurogroup is beginning to resemble the bloodthirsty teenage savages from Lord of the Flies, intent on killing Greece for no other reason, except to teach everybody, including themselves, a lesson in how sub human they can become, when the gang mentality sets in.
And we know, from history, how sub-human they are capable of becoming.

@ Veronica

I doubt you’ve been banned. This site requires moderation because of past “incidents”, and it has to be carried out by professional economits who have better things to do on a Saturday night than read the rambiling of you or me!


Will you be “eating humble pie” is your single (German) source turns out to be wrong?

DOCM cited this article (http://www.telegraph.co.uk/finance/economics/11381533/Angela-Merkel-rules-out-debt-cancellation-for-Greece.html) as evidence of what he called “eating humble pie” on the part of Tsipras. And the author of the article does claim that “Greece’s new prime minister has insisted his country will fulfil all of its loan obligations as it appointed investment bank Lazard ahead of crunch talks with the Troika.”

What is the evidence for this claim? Apparently a quote from Tsipras to the effect that his commitment to end austerity “in no way entails that we will not fulfill our loan obligations to the ECB or the IMF.”

Now, only 16% of Greek debt is owed to the IMF and the ECB. So is this a humiliating climbdown” as DOCM wants to believe? Not at all. What is being said appears to be:

1. We will not negotiate with the Troika as an entity.
2. We will pay off the 16% of our debt owed to the IMF and ECB.
3. What’s left is mostly made up of debt to European partners (60% of overall Greek debt). On this we will negotiate with those partners to reach an agreement on what and how we will repay.

Wow, what a humiliating climbdown! How can Varoufakis even show his face in public after this!

@ skeptic01

This was not an interview but an indication of abandonment of the all or nothing attitude of Varoufakis. It is clear that it is in the interest of both sides to come to a deal and the only flexibility – already publicly offered – relates to the loans advanced by governments, hence the little opening Tsirpas left IMHO by omitting to refer to them. As I said on another thread, the IMF does not – under the effective direction of Washington – do concessionary finance, a fact we have ourselves discovered. As to the ECB, its immediate involvement is in relation to liquidity assistance and the nature of the collateral that Greece can offer. The German press is reporting that Tsirpas contacted Draghi on Friday night.

The reaction of the markets is the decisive element. How Greece can appoint a MOF seemingly unaware of this, or choosing deliberately to ignore the fact, is beyond me.

@ Veronica,

I would imagine it is a more cautious approach being adopted in light of the ‘pantigate’ compenstation.

While the law of the Jungle does occur frequently online… the rules are changing, websites have to be much more careful now as to what they allow to be written online. One does not want to be sued, or shot at!!

Veronica, the slow updates are due to the length of the moderation queue – as in Hospital Trolly waiting times!

Not sure how the ‘moderation’ is actually conducted: software-scans? or individual eyeballs?? Rude remarks are easy to deal with, but some comments can be quite a lot more subtle … …

Most comments will eventuate, but may be untimely or moot in respect of a reply to an earlier comment. I did e-mail Philip Lane about this.

Anyways: this is well worth a careful analysis: –


Will her editor give her a rosette or a roasting?

“The reaction of the markets is the decisive element.”

DOCM: The so-called ‘markets’ – which did exist many years ago have been replaced by electronic, high-frequency trading algoes in a few very-large finance houses. These algoes are probably as close to the ‘Invisible Hand’ as you are likely to get. Now remind me about those ‘wrist-slapping’ fines that have been imposed on those aforementioned large financial institutions for, wait for it – collusion and conspiracy to rig their trades against their customers. Some market. And we now are expected to retain confidence: confidence in what? Fraud? That’s nice!

Anyhows, the advent of QEs, ZIRPs and unconditional guarantees have completely undermined any semblance of financial risk. Its now about market share and ‘margin trading’. Now who was it that followed where Anglo led? And how did that work out – not?

“How Greece can appoint a MOF seemingly unaware of this, or choosing deliberately to ignore the fact, is beyond me.”

The finance minister was first elected (same as Osborne or Noonan) then appointed by the PM. The gentleman is a professor for heavens sake! Is Osborne? Is Noonan? And if’n I alleged that they were all ‘playing politics’ – would I be incorrect? I do not believe so. Ease up.

Not sure if you listened to the BBC NewsNight interview (link above) with the finance minister. But what might be the reaction if the positions were reversed: a Greek journalist ‘doorstepping’ the Chancellor of the Exchequer? What would be the behaviour in the BBC if Nigel F was chancellor?

The chap is a ‘professor’. Exactly, not fit to send out for a pint of milk. He was exposed on Newsnight as a fool. Do you recall the old say “lest he be taken as a fool he kept his mouth shut for fear of opening it he proved it to be true”.
How long will this chap last?

Do yo remember when Paxman took Michael Howard apart,


Are you sure Varoufakis knows what he is doing?


The Newsnight item was not a doorstep but a calculated media intervention. As to the fact of being a professor, it is no more of a qualification than any other and no replacement for good judgement. Depositors in Greek banks do not seem to put much value on that of their new MOF. It was not bad manners – as Varoufakis has suggested on his blog – on the part of the BBC interviewer to insist on this point but to get to the core question; that of his competence.

The over-the-top vehemence and ever more shrill hysterics emanating the well-paid Forces of Order on this blog ought to make clear to anyone paying attention that the new Greek Finance Minister knows exactly what he’s doing.

@ Tull: See my (currently in moderation) comment over on the Varoufakis thread. “Do yo remember when Paxman took Michael Howard apart ..”

Yes, I sort of remember it. So what?

DOCM: Thanks for you comments. Look, I saw what I saw. This is worthy of an Orwell: – “[item] was not a doorstep but a calculated media intervention.” Your quite correct – as usual. I really must get my meds re-calibrated.

Can you, Tull or anyone else please list the basic qualifications for a minister of finance – in the UK, or any EU state. That is, what exactly counts as or repesents ‘competence’?


Surely the important qualification for being a successful MOF is the same one identified years ago by Napoleon for successful generalship: “Is he lucky?”

Napoleon’s criterion was not frivolous. Some people have the energy and conviction required to overcome adverse circumstances and make the most of fortuitous opportunities. Good characteristics for any MOF.

Skeptic01: Now how did I miss that one! Wood(s) for the trees, and all that? Thanks.

Though in this specific circumstance I expect that getting elected to parliament in the first instance might be a tad useful. And being a ‘friend’ of the PM, of course. Yeah, luck’s surely the thing! Though I hear that being a schoolteacher may be a sine-qua-non. Hmmmmm.


In my humble opinion, not having an academic background is a decided advantage. You are less likely to default to lecture mode and even less likely to think you know it all. Finally, there is just a chance that any forecast you make would not be wrong 90% of the time.


Our schoolteacher has had a good innings so far, at least judging by his own lights. I’m sure his opponents would say he has just been lucky. Indeed!

@DOCM, Tull et al.

The elections in Greece: A clear message to the European Union

The working people of Greece have delivered a clear message to the European Union, to the International Fund and to the Greek oligarchs that they have had enough of “austerity,” enough of being bullied, enough of being dictated to by these forces.


Tull, thanks for that good laugh. Actually any econ who knows what they are doing would always toss a fair coin first – that would be 50:50. That’s what J K Galbraith advised. I’d not argue that.

Nothing personal you understand. But you and DOCM remind me of day-traders engaged in a desperate short of the Hellinic parliament. Now I hope neither of you are on margin – and have no leverage. Betting against the house and all.

Der Spiegel …. 3 articles … Democratic Reality Dawning – Better than Golden Dawn!

Syriza’s victory in Greece makes it clearer than ever that a new approach is needed in Europe. Chancellor Merkel, in particular, must show flexibility in the search for compromise with Greek Prime Minister Tsipras. If they can’t agree, Europe is in trouble.

This means that Germany must display forbearance. Germans have been forgiven for so much in their own history that they should also be capable of forgiving others. Despite mistakes made by the Greeks, solidarity remains the correct course. That’s not to suggest that the Tsipras administration can ignore the treaties Greece has with the EU. Nor should there be a debt haircut, because Spain and Portugal would demand equal treatment and that would place an unbearable strain on the euro zone. However, deferments and interest rate discounts are possible. No one should be too proud to talk about the possibility of concessions.


No mention of the best ordoliberal ‘little boys’ in class!


Greece’s New Economics Minister: ‘Europe Doesn’t Need To Be Afraid’

Interview by Manfred Ertel

Greece wants to remain in the euro zone, but Athens wishes to renegotiate everything relating to the current austerity regime. SPIEGEL spoke with Economics Minister Giorgios Stathakis about how the new government intends to address that challenge.

Stathakis: Afraid of what? No, you don’t need to be afraid. Syriza was all along arguing that the terms imposed by the troika have extremely negative effects on our economy and on our people and that they must be changed. The same is also true of Europe.

SPIEGEL: How do you mean?

Stathakis: By way of changes to financial policy toward a more expansive public monetary policy. Our citizens are tired after five years of strict austerity; they feel as though they have been punished by Europe. We need a new agenda for a healthy economic development and a sturdy fiscal framework that alleviates the negative social effects of the crisis. That is why Syriza’s election victory could help push through a new type of crisis management in Europe.

SPIEGEL: Still, with his demands for a debt cut and promises of billions in gifts to Greek voters, Alexis Tsipras has frightened his European partners.

Stathakis: We have always said that the solution to our problems must be a European one, with agreement from Europeans on the basis of a very sound idea of mutual interests. That’s why we have partners. On the other hand, it has to be a major policy shift to be made in Greece. That is unavoidable.


Georgios Stathakis, 61, is an economist by training and will be in charge of the economics, infrastructure, tourism and shipping portfolios in the cabinet of newly elected Prime Minister Alexis Tsipras. He will lead negotiations with Brussels together with Deputy Prime Minister Giannis Dragasakis and Finance Minister Giannis Varoufakis. The son of a shipping magnate, Stathakis used to be a communist and taught Marxist theory at the University of Crete prior to joining Tsipras’ cabinet. He tends to avoid shrill tones, instead favoring more moderate ones.


“The chap is a ‘professor’. Exactly, not fit to send out for a pint of milk. He was exposed on Newsnight as a fool. Do you recall the old say “lest he be taken as a fool he kept his mouth shut for fear of opening it he proved it to be true”.
How long will this chap last?

Do yo remember when Paxman took Michael Howard apart,”

I thought the Greek finance minister came across as on to of his brief and rather more genuine in what he was trying to communicate than most politicians./ Emily at the ‘Beeb on the other hand, much like most BBC presenters (Paxo included) seemed totally out of her depth discussing economics & finance and unable to ask an intelligent follow-up question as a result. She gave up listening top each of his answers and just threw in a pre-prepared, poorly judged follow-up.

Micheal Howard was simply & obviously exposed transparently avoiding one simple question (using the device of pretending not to understand it properly) which got repeated more times than he had bargained for because the Newsnight production crew weren’t ready to go to the next item.

According to Bloomberg, the chap has capitulated and dropped that hair cut demand and looked for switch terms out of the the existing bonds to some sort of growth related instrument.
In return the Germans are offering a reduced role for the IMF & the renewal of existing commitments. Personally, I would want the good cop in the room.
We shall see but it looks like the revolution is over.

Getting back to the OP’s question, regardless of what you think of Syriza it does seem that the left in Europe has been banging its head off a wall for a while.

Right and left-leaning countries have reached an impasse, because they refuse to acknowledge each others’ legitimate concerns. The left believes that government stimulus is the only way forward and continues to speak that language at election time, but when elected they are now severely constrained in their ability to enact stimulus policies. That’s a big problem in countries where such policies have historically been popular and people expect to able to vote for them. The right has been dismissive of the need to accommodate such voters, because conservatives believe that stimulus policies don’t work anyway.

The left is equally dismissive of right-wing concerns. If government G launches a major stimulus programme, and the programme fails (say due to corruption, or ineffective governance), large costs would fall on other Eurozone countries. That would represent an undemocratic transfer of resources without the consent of voters, which conservatives find unconscionable. The left rejects this concern as invalid, on grounds that stimulus is bound to succeed under current conditions and any resource transfer would be counteracted by growth. But historically, currency unions have been plagued by free riders.

The right have a legitimate point that voters in one country should not be able to choose to “stimulate” their national economy ad infinitum without the consent of others. That could only result in a free-for-all and the end of the union. However, as a thought experiment let’s take the opposite extreme and suppose that every country in Europe had a majority in favour of stimulus. Some countries still wouldn’t be able to enact any stimulus due to financial weakness at the national level, and the austerity rules that would accompany EZ-level support under current rules. Even if those countries had significant governance problems worth correcting, it would be hardly be fair to ask them to put on the restructuring hairshirt while everyone else parties.

The current situation is that we have rules to assuage conservative concerns, and left-wing governments in several countries that are trying to ignore the rules or find various devious ways to work around them. To overcome this sorry state of affairs, the left needs to propose institutional change that will allow voters to choose stimulus while accommodating the legitimate concerns of the conservatives countries. I’m not a leftie so don’t ask me to make proposals – but off the top of my head, the various bailout funds that now exist are controlled by technocrats and the Council of Ministers. Instead place them under the direct control of the European parliament, so that representatives can vote for a “stimulus bailout” if they think that’s appropriate. Conservatives would resist but large numbers of their supporters would be co-opted, because such proposals can address their core concern about undemocratic resource transfers.

Modifying governance of the bail-out funds may or may not be a good idea. But what is surprising to me is that the left has failed to pursue any ideas in this or any other worthwhile direction. They are either totally blind to the “legitimate concern” of conservatives that blocks them every time, or maybe they just reject EZ-level solutions because they are predominantly national movements that can’t envisage centralizing any more power?

But can you imagine a Mitterand, say, sitting around in the current situation with nothing to propose but more moaning about the Germans?

Text from Blind Biddy in Athens:

Greek “Rock Star” Cleaning Ladies 1: Troika 0

Defiance and Charm: A Measured First Week for New Greek Leader

By Manfred Ertel, Julia Amalia Heyer, Walter Mayr and Juliane von Mittelstaedt

Syriza’s victory in the recent Greek elections set off a wave of concern in Europe. But even as the new prime minister tries to woo other leaders, his left-wing government is already busy getting down to work. Many of its first moves have been the right ones.


Worth reading; methinks a few lessons for the locals … and other EZ “debtcroppers” and supine serfs.

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