Burning Questions: Greek ‘Snap’ Elections

1) How important is it that the creditors to agreed to debt restructuring/re-profiling? (the Troika had previously refused to put anything in writing.)

2) Was GRexit preferable to a third Memorandum that included debt restructuring/re-profiling? If so, why? (how important was it that the Summit Agreement did not include a description of what debt sustainability would look like?)

3) Given the importance of debt restructuring/re-profiling, was it a mistake for Tsipras to NOT demand/secure an agreement/understanding/framework on the parameters of debt restructuring BEFORE: a) passing the latest round of legislation?; b) calling snap elections?

Is this really so difficult? Germany says that they want IMF in the mix. The IMF already has debt sustainability criteria and has done enough analysis that they say Greece needs, at a minimum, an extension of 30-years (!). Why not simply agree to implement according to IMF criteria/analysis? Then commit to making Greek debt sustainable by the end of the third MOU in 3 years (with initial relief coming this fall).

4) How confident are you that there will be significant debt restructuring/re-profiling? Germany seems to prefer drip..drip..drip debt re-profiling that keeps Greece in debt peonage. This seems identical to what they had promised prior to the referendum (but would not put in writing – probably because it is clear insufficient and transparently one-sided). And while they claim that the IMF is necessary, one could well wonder if they would prefer to control re-profiling than to bend to IMF involvement.

5) How does your answer to #4 affect your view of #1?

6) What countries/movements/organizations will vigorously support a debt restructuring/re-profiling for Greece that is significant and leads to a sustainable debt by the end of the third MOU? While France and Italy were supportive during the Summit, I haven’t heard much from them since.

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I originally thought that the Summit Agreement was an accomplishment.  The referendum embarrassed the Troika and caused a willingness to put their promises of debt re-profiling (no write-downs!) into writing.  But what they put into writing was fairly vague – and in the weeks after the Summit Agreement, Germany has backed away from any meaningful debt relief despite saying that they want IMF to be involved (IMF will not be involved unless the debt will be sustainable).

IMO Tsipras blundered in not making the failure to agree on debt relief parameters into an issue.  Without meaningful debt relief, Greece is in debt peonage (aka “debt colony” or “debt slavery”). Tsipras may think his chances of election are better now than later but with Syriza breaking apart, Tsipras is very likely to find that his support dries up: as popular as he may be today, no coalition will have him.  I think the Greek people know – or will be told – that if Tsipras had thought that meaningful debt relief was in the cards, he would’ve waited on elections.

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