Stop me if you’ve heard this one before:
Germany’s Suddeutsche Zeitung reported that just two (or is it three, this past summer is one big blur) months after Greece voted through its third bailout, one which will raise its debt/GDP to over 200% on a fleeting promise that someone, somewhere just may grant Greece a debt extension (which will do absolutely nothing about the nominal amount of debt), its creditors have already grown tired with the game and are refusing to pay the next Greek loan tranche of €2 billion.
Specifically, the payment of the first €2b tranche of €3b is now sait[sic] to be delayed because Greek Prime Minister Alexis Tsipras failed to implement reforms on schedule, Sueddeutsche Zeitung reports, citing unidentified senior EU official.
And evidently one of the latest sticking points is that Tsipras wants to prop up deadbeat home loans for houses worth as much as $331,185.
Greece edges close to default. Greece’s creditors demand reform. Greece agrees to reforms at last minute. Greece gets bailout. Greece fails to implement reforms.
Rinse. Repeat.
How about a short LinkSwarm to get the Friday LinkSwarm back on Friday?
Another LinkSwarm. And if you’re live in Austin, don’t forget the meetup/blogshoot on October 10th.
One theory:
I increasingly think the Democrat/Muslim union has to do with old-fashioned relativism. Democrats don’t actually believe that women’s rights and gay rights apply to everyone; white people: sure. Arabs? Well, who am I to judge? And Muslims know this.
When Robby George is just dumbfounded as to why all these Muslims support the party of abortion on demand and gay marriage, the answer seems pretty clear to me: They’re supporting the party of abortion on demand and gay marriage for infidels
Another:
I think the issue is more that they see Muslims as a new potential mascot group that they can champion and therefore obtain that cheap sense of moral superiority that comes with riding in like a white knight. I think a lot of liberal attitudes towards minorities aren’t actually based on the good of the minorities, but how good it makes the liberals feel to champion them. Muslims are (as of now) a tiny, insignificant minority. They’re mostly kinda swarthy, so the “it’s racism” meme is easily transferable, and a significant chunk of liberals loathe Christianity.
You may have heard that Angela Merkel has performed a 180 degree flip on allowing those 800,000 “refugees” (read: Muslim illegal aliens, most from outside Syria) to settle in Germany.
Idiocy like this certainly isn’t going to convince Germans to let more Muslims in:
Muslims in Germany Demand End to “Un-Islamic” Oktoberfest
Dear City council of Munich,
I am writing this letter to bring to your attention something that I
and many Muslims believe is unfair and requires attention. I would like to inform you that the Oktoberfest is an Intolerant and Anti-Islamic event. We tried to ignore the event, but there too many Un-Islamic acts done at the Oktoberfest. Such as alcohol consumption, public nudity etc.We understand that the Oktoberfest is a yearly German tradition, but we, Muslims, can not tolerate this Un-Islamic event, because it offends us and all Muslims on the earth. We are requesting the immediate cancellation of the upcoming Oktoberfest event.
Yeah, you go ahead and try to prevent Germans from celebrating Oktoberfest or drinking beer. Because pissing off Germans is such a proven route to happiness…
The self-inflicted destruction of Greece has been accomplished, but they’re still going to be picking up the pieces for years, if not decades. And there’s no guarantee the heavy manners Germany and the troika are imposing will actually be enough to rescue it.
So, enjoy a random collection of Greek headlines, since I don’t quite have time to pen a piece on The Greater Meaning Of It All:
Many observers are wondering how the left-populist renegades of Greece’s Syriza party, which rose to power in January on the promise of delivering relief from austerity and renewed its mandate with a massive victory in the July 5 referendum, managed to negotiate a bailout deal on Monday that is substantially worse than what was available to Greece before Syriza took office.
That would be because they were idiots who lied to voters about what they could accomplish.
Looks like all of Greece’s creditors have finally decided it’s put up or shut up time for reform. “Greek Prime Minister Alexis Tsipras is expected to face demands for tough reforms of Greece’s pension system, labor laws and other areas, as well as creditors’ insistence on painful budget measures to ensure that Greece runs a fiscal surplus before interest.”
At this point Greece seems completely and utterly broke, unless there’s more upfront money in that still unsigned Russian pipeline deal than reports indicate (doubtful, given Russia’s own financial straits), or Tsipras finds yet another hidden money reserve to tap (“We can can pay pensions from the children’s bone marrow fund!”). So despite Tsipras’ insistence that they be allowed to keep spending other people’s money on their bankrupt welfare state, this time the jig may finally, finally, really, we mean it this time, for sure, be up.
Here’s a piece that explains in terms of game theory why Tsipras overplayed his weak hand:
Now, as long as the EU keeps Greece in the Eurozone then the Tsipras administration will find itself forced to either exit the Eurozone or apply the austerity it promised to end. Not only would such an outcome send a clear signal to other Eurozone nations that exiting was foolhardy, it would also indicate that radical, nationalist, anti-establishment and anti-austerity parties cannot deliver on their promises.
The EU won’t force Greece to exit the Eurozone but it won’t offer anything to keep Syriza in power, either. The EU simply needs to keep negotiating without offering anything but strict compliance with what was already agreed upon, which is continued austerity in return for loans. In effect, to use a sports analogy, the EU just needs to “run out the clock.” In the end, it appears that Tsipras will either be forced out of office or forced to break up his coalition and form a new government with the mainstream parties, the outcome that EU and Germany have been angling for all along.
(Though make no mistake: that “primary surplus” was always illusory.)
A few more Greek debt crisis links:
Angela Merkel tamped down a party revolt to extend the Greek bailout terms by four months. And her reward for extending that lifeline? Greek Prime Minister Alexis Tsipras reviving demands that Germany pay World War II reparations to Greece.
Before Syriza came to power, the rest of the EU and the Troika seemed content to play along with the Greece farce (extending further loans in exchange for yet more empty promises of reform) at least a little while longer. However, Syriza’s virulently anti-EU and anti-Germany rhetoric seem to have finally exhausted their patience with the show. It seems even Europeans have limits to the abuse they’re willing to take from perpetual welfare recipients. It’s bad enough to underwrite a freeloader, but evidently having to put up with constant insults from them was too much.
At this point, everyone knows Greece will neither reform nor pay back their debts to the Troika (or anyone else). That’s why Europe has finally started taking a real hard line with them, insisting on inspectors on the ground to see reforms are actually implemented.
Either Tsipras has severely overplayed his hand (quite possible), or he is deliberately preparing to use Germany as the theoretical scapegoat for exiting the Euro.
To say that Tsipras and Syriza has no plan B to escape the crisis is misleading, since their cunning “insult our creditors into giving us more money” doesn’t even count as a plan A.
A bailout from Russia? It’s not like Putin is rolling in dough following a fall in oil prices and his continuing isolation over his invasion of Ukraine. Let Putin subsidize Greece all he wants. (And I doubt a Greek navel base would give him any advantage over what he has in Sevastopol.)
Greece could have avoided all this many years ago if their government had just stopped spending more money than they took in. Given their addiction to a bloated welfare state, this is the one thing they have proven singularly unwilling to do.
I doubt Syriza has thought through just how nasty a divorce from the Eurozone might turn out. Never mind asking they repay their debts, I’m thinking a complete halt to all bank transfers between the Eurozone and Greece, and international foreign exchanges refusing to list a newly floated drachma. People hate having their welfare benefits cut, but they really, really hate being unable to buy food…
Greece has finally reached the stage of socialism where they’re run out of other people’s money, and the results are not going to be pretty.
Experience is a dear teacher, but fools will learn from no other…
Newly installed Greek Prime Minister Alexis Tsipras gave a speech in which he basically declared “Screw your stupid economic reality! We’re still giving everyone a free unicorn!”
Remember that Greece is not just broke, but deeply in debt, has a declining economy, only a few weeks of money left, and the specter of a possible bank run for of people wanting to get ahead of a Euro-exit.
So naturally Tsipras is promising Greeks a T-bone in every pot.
“Syriza’s pledges to the electorate include a freeze on pension cuts, a property tax overhaul, free electricity to those who have been cut off, reinstating jobs and raising the minimum wage.”
“‘The (bailout deal) has been abolished by popular mandate,’ Tsipras said. I’d love to see someone try that “abolished by popular mandate” as a reason to stop making their car payments.
“We will not negotiate this people’s pride and dignity.” Yes, because spendthrift wastrels can have all the pride and dignity they can eat.
The EU is is not amused. How can they, when Syriza’s policies seem completely disconnected from reality?
In a lengthy list of policy actions, Tsipras also said the government plans to restore the tax-free threshold for individual workers to 12,000 euros a year and gradually raise the minimum wage to 751 euros a month through 2016. Both measures would breach the conditions of the bailout.
Tsipras said he’s committed to maintaining balanced budgets and wants to negotiate terms that will make Greece’s debt sustainable.
That’s like saying “I’m absolutely committed to eating eating a 72 oz steak every day, and to losing weight!”
Oh, and he’s also demanding reparations from Germany for World War II. Good luck with that.
Is Tsipras really that disconnected from reality? Well, he is a far-leftist (which in the context of Europe and Greece means that he probably makes Obama look like Dick Cheney). But a little further down in that Bloomberg piece, you get this:
Behind the public rhetoric, the Greek government has shifted to a more cooperative tone in recent conversations with the troika, according to an official representing the creditors. Greece has been told it needs to ask for a formal extension of its existing bailout deal in order to receive financing, said the official, who asked not to be named because the discussions are private.
It’s probably your classic “Clevon Little holding a gun to his own head” bluff. I’m sure Syriza would love to implement their pie-in-the-sky big spending socialism, but their real goal is to lie to the Greek people long enough for the EU to write at least one more check, and lie to the EU about implementing reform long enough to cash it. Since Syriza only recently came to power, they probably want keep the farce rolling long enough to feather their own nests with Euros before engineering a grexit. After all, center-right parties got their turns at the public graft trough; why not the far left?
Will the EU call their bluff? The whole purpose of the bailout regime was for insiders and bankers to dump their exposure to Greek default onto the taxpayer, something that’s largely been accomplished. These days I suspect very few of Europe’s banks hold much Greek debt (some of whcih may have ended up in various pension funds, where unrealistic promises and chronic underfunding may force managers to chase extremely risky bonds for the high yields). A grexit would put an economic hurt on Europe, but probably not one that would last terribly deep or long. A Greek economic collapse following leaving the Euro would be terrible for Greece, but would probably prod the other PIIGS into continuing to get their economic houses into something resembling order.
How bad would a grexit be for Greece? Really, really, really bad. The modern European cradle-to-grave welfare state is unsustainable, and attempts to keep the goodies flowing even after the state is bankrupt will ruin more than one nation. It’s just that Greece managed to get there first.
The farce is going to end very, very badly for average Greeks, but it always was. The only question is just how many bodies will be on the floor at the end of the final act…