Greece crisis: Europe on edge over snap election

[Herr Tubthumper]

A key part of their campaign was about convincing the EU to write off half of their debt.

I'm not disputing this.

 

[Herr Tubthumper]

Ex BBC News: As finance ministers met in Brussels, Finnish Prime Minister Alexander Stubb warned his country had no intention of writing off Greece's debts but suggested the loan repayment period could be extended.

"The starting principle is that we will not extend any debt forgiveness but we are ready to discuss programme extensions and loan period extensions," he said

Doesn't sound like they have convinced them as yet......

I doubt they will. But they'll meet somewhere in the middle

 

[Dandyman]

And just in case Auntie Angela needs a history lesson:

https://www.gov.uk/government/publications/agreement-on-german-external-debts-london-2721953


http://library.fes.de/pdf-files/iez/10137.pdf

 

[Dandyman]

Hats off to the Greeks for having the guts to stand up for themselves.

 

[Man of Harveys]

Hats off to the Greeks for having the guts to stand up for themselves.

Hats off to chronic government overspending, then getting all pissy and proud when whoever's bailing you out once again asks you not to spunk it all away this time? I don't think that's brave or anti-austerity or even daringly anti-EU. I think it's entirely irresponsible. You and I normally are one on politics but I think we may have to agree to disagree on this.

 

[Mellor 3 Ward 4]

The Greeks vote in a government which a) prefers to remain in the EU and b) work with the EU to resolve their debt issue. Where's the middle-finger exactly? But I agree, this is good news for Europe.

I think you've got this wrong.

Yes, Greece wants to stay part of the EU, and the euro, but there's no doubt this is a huge F@@k you to Merkel. The Greeks have voted in a party who has said they want half of their debt written off, and will then reemploy all the sacked public sector workers, raise pensions and bring the pensionable age back down to 52.The Germans, Dutch, European Central Bank etc won't allow that as it would simply lead to other anti austerity parties in countries like Portugal coming to power and asking for the same.

How many Germans are happy to see Greeks retire at 52 whilst they continue to work till they're what 65(I'm guessing, I don't know the German pensionable age)?

Tsipras has formed a coalition with a far right, anti immigration party too, hardly comfortable coalition partners, so what concessions will he have to give them?

Not sure how you can say this is a good day for Europe.

 

[jakarta]

I think you've got this wrong.

Yes, Greece wants to stay part of the EU, and the euro, but there's no doubt this is a huge F@@k you to Merkel. The Greeks have voted in a party who has said they want half of their debt written off, and will then reemploy all the sacked public sector workers, raise pensions and bring the pensionable age back down to 52.The Germans, Dutch, European Central Bank etc won't allow that as it would simply lead to other anti austerity parties in countries like Portugal coming to power and asking for the same.

How many Germans are happy to see Greeks retire at 52 whilst they continue to work till they're what 65(I'm guessing, I don't know the German pensionable age)?

Tsipras has formed a coalition with a far right, anti immigration party too, hardly comfortable coalition partners, so what concessions will he have to give them?

Not sure how you can say this is a good day for Europe.

Precisely, if you want to have a Banana Republic style economy then you can't expect to have a German style currency at the same time.

Welcome back to the Drachma I reckon.....

 

[cunning fergus]

The problem is that Greece's creditors will want some of the debt to be repaid and whatever is agreed, Greece will fail to make the payments they agree to make, and they'll continue to need to borrow more, and this will continue until the creditors can take no more.

I don't disagree, however wasn't was the situation before this election.

Greece's creditors can't afford to take another haircut (especially the banks) however Greece cannot afford to continue to pay, unless they continue grind their economy into dust (which is not sustainable).

Neither option is great, however some kind of fudge will be found because I think a) the Greeks have spoken democratically and the EU can't ignore it, a b) global political pressure will be to maintain economic stability.

The edifice of the ersatz progressive EU is slipping, it's primary problem is political not economic.

 

[Herr Tubthumper]

I think you've got this wrong.

Yes, Greece wants to stay part of the EU, and the euro, but there's no doubt this is a huge F@@k you to Merkel. The Greeks have voted in a party who has said they want half of their debt written off, and will then reemploy all the sacked public sector workers, raise pensions and bring the pensionable age back down to 52.The Germans, Dutch, European Central Bank etc won't allow that as it would simply lead to other anti austerity parties in countries like Portugal coming to power and asking for the same.

How many Germans are happy to see Greeks retire at 52 whilst they continue to work till they're what 65(I'm guessing, I don't know the German pensionable age)?

Tsipras has formed a coalition with a far right, anti immigration party too, hardly comfortable coalition partners, so what concessions will he have to give them?

Not sure how you can say this is a good day for Europe.

After everything they have been through the Greeks vote in a government which was on a prefer-to-stay-in-the-EU ticket. I'm struggling to see why this is a huge **** off to Germany. Had they voted in a Greek UKIP then fair enough....but they didn't.

And let's wait an see what they negotiate eh? Of course they will start of asking for a lot. And the EU and/or ECB and/or IMF will initially say no. This is how a lot of negotiations start. I am pretty sure they meet somewhere in the middle though.

 

[cunning fergus]

I think this is where we'll have to agree to disagree. The Greek political establishment might want to keep the status quo, I think the Greek people DO want out of the Euro or at least away from being dictated to by Merkel and given the way that they have abandoned PASOK for the extremists on both sides, they really don't care what the rest of Europe thinks. I've been keeping a close eye on the news for this election and time and again when interviewing people the response is...perhaps we should revert back to the drachma because things can't get much worse. And if this new government fail to sate the electorate's feelings then goodness knows what's next.

You may be right, however I think that Greece is a country which has had a difficult economic and political past and despite their obvious current antipathy to the "political" establishment of the EU, they understand the benefits for a small country of membership of a bigger institution like the EU.

I think that outlook is not (for example) the same in the UK, and certainly not amongst British citizens of a certain age.

That said I don't think the Greeks would wear EU membership at any cost, and that limit is much closer than it has ever been..

 

[Hampster Gull]

Greece has big f##k off party on the back of cheap euro money with the currency defacto underpinned by Germany, which enables the Germans to bloat their economy on the expanded market. Then the bill comes and Greece don't want to pay and the Germans still want their cash. Who is right and wrong? Shades of grey as ever. For me, write a good chunk of the debt off, those people have suffered enough. The lenders can take it as a lesson in lending.

 

[TomandJerry]

Greece's current position:

Public debt: €316bn, or 176% of gross domestic product - highest within eurozone (as of end of Q3 2014)
Public deficit: 0.8% of annual GDP (as of end of Q3 2014)
Unemployment: 25.8% (Oct 2014)
GDP (2013): €182bn
Bailout loans: €240bn

New Greek coalition - allies and dates to watch

Syriza, acronym meaning the "Radical Coalition of the Left", was formed in 2004 and is led by Alexis Tsipras, 40; first came to prominence after 2008 Greek riots
The Greek Independents, a right-wing party formed as a New Democracy splinter in 2012 and led by Panos Kammenos; hard line on immigration
Both allies want to end austerity and renegotiate Greece's debt
27 Jan: Government cabinet expected to be named
28 Feb: Bailout extension expires
20 Jul: 3.5bn euro bonds mature

 

[Buzzer]

I'm struggling to see why this is a huge **** off to Germany.

Maybe this will help

http://www.bbc.co.uk/news/world-europe-30906153

 

[Dandyman]

Hats off to chronic government overspending, then getting all pissy and proud when whoever's bailing you out once again asks you not to spunk it all away this time? I don't think that's brave or anti-austerity or even daringly anti-EU. I think it's entirely irresponsible. You and I normally are one on politics but I think we may have to agree to disagree on this.

We are normally and we may even be on this one. Syriza's Finance Minister is very clear that it is both crooks within Greece as well as the loan sharks outside that are responsible for the current mess:

http://www.realclearpolitics.com/vi...oy_greeces_corrupt_expoitative_oligarchy.html

Loans to Greece are not about helping out the Greeks IMO so much as bailing out German banks. The debt simply can not be paid and as with West Germany in 1953 there needs to be something radical done before the current crisis becomes a permanent situation.

 

[Mellor 3 Ward 4]

After everything they have been through the Greeks vote in a government which was on a prefer-to-stay-in-the-EU ticket. I'm struggling to see why this is a huge **** off to Germany. Had they voted in a Greek UKIP then fair enough....but they didn't.

And let's wait an see what they negotiate eh? Of course they will start of asking for a lot. And the EU and/or ECB and/or IMF will initially say no. This is how a lot of negotiations start. I am pretty sure they meet somewhere in the middle though.

I'm sure you're right about negotiation, but having spoken to two left leaning Greeks today, I can tell you that they are currently sticking two fingers up at Merkel.

 

[Herr Tubthumper]

We are normally and we may even be on this one. Syriza's Finance Minister is very clear that it is both crooks within Greece as well as the loan sharks outside that are responsible for the current mess:

http://www.realclearpolitics.com/vi...oy_greeces_corrupt_expoitative_oligarchy.html

Loans to Greece are not about helping out the Greeks IMO so much as bailing out German banks. The debt simply can not be paid and as with West Germany in 1953 there needs to be something radical done before the current crisis becomes a permanent situation.

Why are the loans bailing out German banks? They have been loaned money from 3 sources as far as I'm aware: EU, ECB and IMF. Are all 3 entities bailing out the German banks in your view?

Besides, the previous government agreed a deal to repay. This has been deemed unacceptable by the Greek nation so they have voted in a party which which wants to stay in the EU and renegotiate the loan payments. I'm really struggling to get worked up over this. It's all a bit meh to me.

 

[Herr Tubthumper]

Maybe this will help

http://www.bbc.co.uk/news/world-europe-30906153

Have you photoshopped that?

 

[cunning fergus]

A fudge would suit quite a few in Europe, I reckon. Might it be used as a catalyst for talks around real change in Europe? I can see other countries getting a bit of what Greece is getting, whilst the net contributors will be after some tradeable concessions. Might this end up being the opportunity Cameron has been looking for to renegociate Schengen?

Undoubtedly so, I have no doubt that the same approach to dealing with genuine problems in the EU will apply to this crisis till the next crisis episode arises. To be fair, the QE programme announced last week will help some of the other poorer EU countries to some extent (it has been outrageously withheld from Greece), so the EU has already played a big bargaining chip to keep other countries on message. That was no coincidence.

I think the EU will be desperate not to be seen to move that far for the Greeks for the very reasons you identify, at the end of the day the political leaders of the EU's nation states they have their own domestic electorates to pander to.

If you are right though, it would indicate exactly how far the balance of power has shifted in the EU construct, with democratically elected leaders needing events like this to leverage concessions from unelected non entities to help with their domestic political difficulties.

 

[Triggaaar]

Greece's creditors can't afford to take another haircut (especially the banks) however Greece cannot afford to continue to pay, unless they continue grind their economy into dust (which is not sustainable).

Or (and I know this is radical) they try working until they're 65.

Neither option is great, however some kind of fudge will be found because I think a) the Greeks have spoken democratically and the EU can't ignore it, a b) global political pressure will be to maintain economic stability.

Allowing a member to fail isn't great, but to bail them out indefinitely, regardless of their attitude towards making an effort themselves, would be worse. They can't send the message to all the poorer countries that they can take it easy, as they'll never have to pay. Greece have simply voted to live as nicely as they can for now, to not bother paying, and to hell with the consequences. There will be consequences. The problem with socialism is that eventually you run out of other people's money.

 

[beorhthelm]

Why are the loans bailing out German banks? They have been loaned money from 3 sources as far as I'm aware: EU, ECB and IMF. Are all 3 entities bailing out the German banks in your view?

the German (and French) banks are upto their eyeballs in Euro debt, including the original Greek debt. the bailouts have only been loans to cover repayments and interest for a short period, the debt is still largely outstanding, and the banks that hold them have massive problem if they have to write them off following a default. so, in effect, the bailout is proping up German banks. this is why its deemed just about acceptable. the big FU to the Germans is that the Greeks is saying "we want a deal on our terms, not yours, or up yours we're off", knowing full well they cant really afford to leave the Euro*, but neither can the Euro start having people leave as its the beginning of the end.

*Euro, not EU, i dont believe Syriza has ever been anti-EU.