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Alexis Tsipras' Open Letter To Germany: What You Were Never Told About Greece
Authored by Alexis Tsipras via Syriza.net,
Most of you, dear [German] readers, will have formed a preconception of what this article is about before you actually read it. I am imploring you not to succumb to such preconceptions. Prejudice was never a good guide, especially during periods when an economic crisis reinforces stereotypes and breeds biggotry, nationalism, even violence.
In 2010, the Greek state ceased to be able to service its debt. Unfortunately, European officials decided to pretend that this problem could be overcome by means of the largest loan in history on condition of fiscal austerity that would, with mathematical precision, shrink the national income from which both new and old loans must be paid. An insolvency problem was thus dealt with as if it were a case of illiquidity.
In other words, Europe adopted the tactics of the least reputable bankers who refuse to acknowledge bad loans, preferring to grant new ones to the insolvent entity so as to pretend that the original loan is performing while extending the bankruptcy into the future. Nothing more than common sense was required to see that the application of the 'extend and pretend' tactic would lead my country to a tragic state. That instead of Greece's stabilization, Europe was creating the circumstances for a self-reinforcing crisis that undermines the foundations of Europe itself.
My party, and I personally, disagreed fiercely with the May 2010 loan agreement not because you, the citizens of Germany, did not give us enough money but because you gave us much, much more than you should have and our government accepted far, far more than it had a right to. Money that would, in any case, neither help the people of Greece (as it was being thrown into the black hole of an unsustainable debt) nor prevent the ballooning of Greek government debt, at great expense to the Greek and German taxpayer.
Indeed, even before a full year had gone by, from 2011 onwards, our predictions were confirmed. The combination of gigantic new loans and stringent government spending cuts that depressed incomes not only failed to rein the debt in but, also, punished the weakest of citizens turning people who had hitherto been living a measured, modest life into paupers and beggars, denying them above all else their dignity. The collapse of incomes pushed thousands of firms into bankruptcy boosting the oligopolistic power of surviving large firms. Thus, prices have been falling but more slowly than wages and salaries, pushing down overall demand for goods and services and crushing nominal incomes while debts continue their inexorable rise. In this setting, the deficit of hope accelerated uncontrollably and, before we knew it, the 'serpent's egg' hatched – the result being neo-Nazis patrolling our neighbourhoods, spreading their message of hatred.
Despite the evident failure of the 'extend and pretend' logic, it is still being implemented to this day. The second Greek 'bailout', enacted in the Spring of 2012, added another huge loan on the weakened shoulders of the Greek taxpayers, "haircut" our social security funds, and financed a ruthless new cleptocracy.
Respected commentators have been referring of recent to Greece's stabilization, even of signs of growth. Alas, 'Greek-covery' is but a mirage which we must put to rest as soon as possible. The recent modest rise of real GDP, to the tune of 0.7%, signals not the end of recession (as has been proclaimed) but, rather, its continuation. Think about it: The same official sources report, for the same quarter, an inflation rate of -1.80%, i.e. deflation. Which means that the 0.7% rise in real GDP was due to a negative growth rate of nominal GDP! In other words, all that happened is that prices declined faster than nominal national income. Not exactly a cause for proclaiming the end of six years of recession!
Allow me to submit to you that this sorry attempt to recruit a new version of 'Greek statistics', in order to declare the ongoing Greek crisis over, is an insult to all Europeans who, at long last, deserve the truth about Greece and about Europe. So, let me be frank: Greece's debt is currently unsustainable and will never be serviced, especially while Greece is being subjected to continuous fiscal waterboarding. The insistence in these dead-end policies, and in the denial of simple arithmetic, costs the German taxpayer dearly while, at once, condemning to a proud European nation to permanent indignity. What is even worse: In this manner, before long the Germans turn against the Greeks, the Greeks against the Germans and, unsurprisingly, the European Ideal suffers catastrophic losses.
Germany, and in particular the hard-working German workers, have nothing to fear from a SYRIZA victory. The opposite holds. Our task is not to confront our partners. It is not to secure larger loans or, equivalently, the right to higher deficits. Our target is, rather, the country's stabilization, balanced budgets and, of course, the end of the grand squeeze of the weaker Greek taxpayers in the context of a loan agreement that is simply unenforceable. We are committed to end 'extend and pretend' logic not against German citizens but with a view to the mutual advantages for all Europeans.
Dear readers, I understand that, behind your 'demand' that our government fulfills all of its 'contractual obligations' hides the fear that, if you let us Greeks some breathing space, we shall return to our bad, old ways. I acknowledge this anxiety. However, let me say that it was not SYRIZA that incubated the cleptocracy which today pretends to strive for 'reforms', as long as these 'reforms' do not affect their ill-gotten privileges. We are ready and willing to introduce major reforms for which we are now seeking a mandate to implement from the Greek electorate, naturally in collaboration with our European partners.
Our task is to bring about a European New Deal within which our people can breathe, create and live in dignity.
A great opportunity for Europe is about to be born in Greece. An opportunity Europe can ill afford to miss.
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Huge man-crush right now. Let's see if he's as good as he seems.
Just say the truth. The German taxpayers weren't bailing out the Greek people , they were bailing out big banks who foolishly bought Greek debt. All those bailouts were about keeping douche bank solvent , along with the rest of them.
Tsipras should write for ZH
on another point, Greece for some reason is the only country which never received any war reparations from Germany, and one country that probably suffered the most from the 2 years famine imposed on Greeks on direct orders from Hitler.
How Strange, I find a like Tsipras as well as Putin. Both are plain talking guys who are calling it they way it is.
Good for them.
Dear Greeks in the new Greek Government who read ZH (we know you are here);
1) Thanks for doing what you are doing -- not just for Greece but for the entire world (literally -- you guys are going to save the planet from the various Oligarchies and bankers)
2) Pass onto Mr. Tsipras that he has the support of many people who hate Leftists. Common sense doesn't recognize political labels.
3) Do what you were voted in to do.
Sincerely,
Haus
If he'd just set up a camera and done a vblog
https://www.youtube.com/watch?v=Zvl9N9GdraQ
He should stay away from grassy knolls and sewer inlets.
continuous fiscal waterboarding
awesome
Most succinctly, "You can't fix a debt problem by taking on more debt".... So simple a child could understand.
Has anyone seen my nailgun? I left it on a bench in Athens and it has gone missing...
I WROTE A LETTER LIKE THAT TO WELLS FARGO WHEN MY MORTGAGE WENT BOTTOMS-UP.
They didn’t buy it either.
Socialists always sound so reasonable when in bankruptcy.
when other people's money has finally run out...
I don't understand the down votes at all. This letter could have been written by a ZH reader. You might not like the man or his politics, or even gyros, but his comments on the debt and banker's bail out is spot on.
Don't be silly. Behind all the rhetoric, ZH readers are wed to the same BakerGangsters that Tsipras is preparring to skuill-fuck.
They have to ACT like they like what he says, because it conforms who they wished they were, but Tsipras isn't an Austrian crackpot relishing the prospect of a deflationary crash.
So they downvote him.
because you, the citizens of Germany, did not give us enough money but because you gave us much, much more than you should have and our government accepted far, far more than it had a right to.
Because all of that borrowed money turned right around and headed back to Germany. Just as there exists a recording saying "Fuck the EU" there is certain to be a second recoding in German saying "Fuck the Greeks."
The problem is that Germany gave the Greeks TOO MUCH MONEY. The bastards.
He sounds like the people who got burned in the real estate bubble. Hey its the bank's fault for lending money to us deadbeats.
what nobody knows is geece is the most rich ground ressources ( sub marine oil ) of the whole europ, but usa put hands over it for 60% since 2010 with speeding up process requested by germany...
if they kick usa out of the energetical plan and ask to russia, i think you got the very next war in europ.
forget ukrain, it's a proxy decoy.
the fact greece is in middle of table now is not the economy, cos she is just flat if you remove interest debt... so...
as long the dog got the leash, no bitting at the horizon right..
The guy's a Marxist just like the guy in the White House. He's part of the problem. It will be interesting what kind of deal he is after.
What he wrote sounds not unreasonable, as far as it goes. As someone wrote above, trying to cure a debt problem with more debt is mad. The comments about insolvency vs. illiquidity are spot on.
He even acknowledges that his German audience will have "the fear that, if you let us Greeks some breathing space, we shall return to our bad, old ways".
But this is the guy who wants to re-hire sacked government employees; raise the minimum wage; hand out free health care, prescription drugs, food, electricity, and no doubt ponies; on and on. How is this not returning to the "bad, old ways"? If anything, it sounds worse than before. I doubt many German taxpayers will be won over.
Socialists? Naa
Socialism is the Manifesto for the Abolition of Enslavement to Interest on Money by Gottfried Feder.
These guys are masked commie bastards straight out of the devil minds of Marx and Engels.
funny
you just decribed the federal reserve of merica...
... and stick to ground transport... we all know how those airplanes like to go down "by accident" when some kleptocrat doesn't get his "due"...
Oh, and learn from all those Middle-Eastern leaders who got popped by their own bodyguards - make sure none of your security team members were trained at "The School of the Americas" in Panama....
Until Tsipras proves unworthy, I'll be sending him a prayer of protection on a regular basis....
Haha snap. I was thinking of the same video...
Yep...that's pretty funny!
Here's the link again:
https://www.youtube.com/watch?v=Zvl9N9GdraQ
Right now everyone at the NSA is working feverishly to find some information that will blackmail this greek into submission. The banksters are equally in a panic to find some way to bribe him. Expect them to pull out every dirty trick in the book... and then invent some new ones. The outcome will be interesting to say the least.
Imagine a US president who speaks this way. It would be a Ron Paul with actual speaking skills good enough to persuasive the masses. Greece has shown us how that can happen. Things must get MUCH WORSE. To the point of society collapsing around us.
dup
Hey Dmitri, get the Pastitsio.. the German one.
Dear Haus,
you may see that righ-left paradigm is again false, same as REP-DEM only to divide people and use hegelian dialectic for ruling purposes.
There is only truth/lie difference and good/bad difference (but for who ... is also important)
best,
Karl
Karl; Leadership requires some speeches. A leader must send some signals for a while to calm the masses in the case of Greece. And he must try to calm the Banks and the MIC as well even if he knows he is going to piss them off.
Nationalism certainly is a problem as well as emotional political followers or party members.
Nationalism is a problem? Hugh? Isn't this letter a nationalistic letter defending Greece as a nation? It's time countries stand up for their righteous principles and let the chips fall where they may in the trade game. The United States tax policy of tariffs, duties, imposts, and excises exist in order to tax countries that lack the values we did. Those principles were destroyed with GATT and other free trade agreements by centralized NWO proponents.
This fucking guy is saving the planet from the bankers and oligarchs? Get the fuck outta here with this insane hero worship. He is offering NOTHING NEW. He may well help bring down the euro, but it will be an accident due to his insane big govt policies. All he advocates, once you get down to it , is to spend moar money. Money that they do not have and cannot get without borrowing, and no one is going to lend then any money. Sure , they can leave the euro and print their own currency to oblivion. And where will that leave them? No where. Find me one time in history when massive govt spending (make no mistake, that's what all this guys ideas boil down to) and a huge govt bureaucracy has resulted in a prosperous society. I'll wait while you look that up. This guy offers nothing new. Just the same tired ideas that have failed EVERYWHERE they have been tried. Govt is the problem, as is fiat money. Until this guy starts advocating getting rid of either of those things, Y'all should get your heads out of the clouds and realize this guy isn't going to save shit.
You should be banned from ZeroHedge, you ignorant cunt.
"You should be banned from zerohedge, you ignorant cunt"
Wow, what an intelligent, enlightening statement. Thank you for bringing that to the discussion. If all you can do is childish insults, why bother logging in and commenting? If you disagree with something I've said, feel free to refute it using a big boy argument of some kind. Otherwise, fuck off
Leftists are quick to worship false idols and ban opposing speech. Think climate-change eco-fascists.
GreensKeeper, it's actually very simple.
Once the debt is repudiated then Greece has NO DEBT. With no debt left to service, income can be used to pay for necessary services on a cash basis.
If Greece leaves the euro, there will be a one time spike of inflation. But after that Greek industry will be competitive again, and the economy will start to grow. Until they do that they are just being trounced by more competitve economies like Germany.
Is repudiating the debt honorable? Yes -- if you believe (as most here do) that the debt issuance was a fraud perpetrated by both the banksters and corrupt politicians.
Greek industry. BWA HA HA HA HA HA HA HA HA!
@mkkby
+1 Amongst the dirty angry rants one little diamond of a comment shines through.
I think that is precisely where the discussions will be heading. Debt relief and perhaps payments in the form of a percentage of Greek's trade surplus.
A lot of people are angry about Syriza's socialist ideals which they perhaps mistakenly equate with big government, statists, etc. It's understandable, but I am reserving my judgement and hoping for the best for the Greeks. They really deserve a break.
As for Tsipras, I just can't see the banksters staying still while this goes on. A default may mean the systemic collapse of the financial system via the derivatives tied with the risk. I fear we are about to see an example of how the banks eliminate their threats in a most brutal and open manner. They have the entire MIC at their disposal after all.
"They perhaps mistakenly equate syrizas socialist ideals with big government/statists"
Have you ever heard of a party with socialist ideals that WASN'T full of big govt statists?
Um, you do understand, don't you, that corporations are chartered by the State, and that most banks are corporations?
Mate, in my experience, conservatives have been known to grow govts bigger than the socialists and vice versa. It's a false dichotomy - that's why it's a cliche at ZH. It all depends on the individuals running it, not the system itself. The system is almost indistinguishable from each other in practice whoever is in power. Surely you've noticed? The scandanavians have a very socialist system, yet the right wingers in say, Norway, have been known to make their govt bigger than the last lot of socialists. It happens. Not as simple as red-team this, blue-team that.
I don't know why the fuck I am arguing for the socialists today, but there you are - I quite like what this Tsipras bloke has to say for himself - really, really dangerous talk - as one would expect from a seasoned ZHer, hence my support for him right now.
I have noticed that about conservatives growing the govt just as bad or worse , which is probably why I'm not a conservative. The problem is govt. Period. And this guy probably isn't going to accomplish shit.
+1 YHC-FTSE, but one small detail "As for Tsipras, I just can't see the banksters staying still while this goes on "
the "banksters" have already filled up their bellies. three quarters of the Greek debt is what EU countries like Germany, the Netherlands and Finland have coughed up in order to bail out Greece from the banksters
so the only business that banksters have left (besides one quarter of that debt) in this saga is... how to bet on it?
cue in the usual bet on EUR breakup, the CDSs that represent only that quarter, etc.
+1 Thank you mate.
what for? when you are imo right, you are imo right ;-)
Ya, he thinks he can start the wash and rinse cycles again just like the rest of the Lefties. Oh well, the rest of us will be also be there eating dirt soon enough. Who will we blame? Is it still the !%? Is it the corporate welfare bums? What slogan will the Progressives think of next to obscure the truth and destroy all meaning in language?
Tsipras is just another criminal bent on stealing the wealth of the Greeks and usuing it to his own ends, whoch would mean handing out just enough to buy himself time to establish his own Totalitarian regime.
His problem is that Greece fortune has already been pillaged and sent to the bankers. If he can get that debt repudiated and wealth returned to Greece he has something to work with. All the fuzzy, "I'm want Greek to have a decent income" bs is just that.
His idea of income is government payments, much like that communist in DC. With an unemplyment rate of 25% and one of the oldest populations on the planet how will Greece be able to grow out of their entitlement payments?
They won't.
But a repudiation of the current debt will buy this charlatan time to build his control structure.
W'all might have our heads in the clouds, but yours is up your arse. So maybe its you who should fuck off.
Another brilliant rebuttal. Thanks for playing.
What kind of "money" was Greece borrowing. The same crap we use as a medium of exchange.
Succinctly stated, he's only half right.
Instead of being completely wrong.
I didn't bother reading your entire post, because you have a hard time with the concept of paragraphs.
The button above the Shift key -- use that to break up your thoughts. Reading your wall of text makes my head hurt.
Yes, he can save the world from the oligarcy and banker shithead islamic fascists that are running the western world?
Its actually pretty easy -- he blows up the Western banking system, leaving the various CBs all over the Western world one of two choices (at the end of the day) print a shit ton of money, or cease to exist. As the West is falling upon its own sword, Vlad and the Chinese will get nice and cozy together. They will become a world force, and the West -- as it is rebuilding -- will be coming at the situation as the subserviant player on the field -- not the dominant one as it is now. It will have to get its shit together to keep from getting steam-rolled over, either with ta T-95 or at the ballot boxes as what just happened in Greece last week.
Mark my words -- Tsipras is employing nothing but "Kamakazie Economics" but I think he is strapping on a BRICS parachute before the final nose over.
Nice wall of text that doesn't really refute anything I wrote. Try reading it again, sorry if it makes your brain hurt. Take breaks if you need to. Then please explain how this guy is going to save the world. He brings NOTHING new to the table. Just the same shit that has been tried before. Even if he defaults on those loans , and for Europes sake I kinda hope they do, they will just paper over it just like they always do. And Putin isn't going to save you either. That's almost as funny as this Greek guy. All this guy is going to do is the same shit socialist govts do every time they get put into office. It hasn't worked yet, and it isn't going to work now. No govt is going to fix this, since govts and central banks caused all these problems in the first place. The sooner people, including yourself, stop putting your faith in any govt to save you or save the world , the better off we will be.
Christ Jesis man. The Enter button is not hard to use.
I put not faith in any government. I have no doubt this government is as corrupt as the previous one. I do however know, through professional experience -- what happens if Greece writes off all its debt.
Its the bankruptcy of the West. Slowly at first -- might take a quarter or two, but it puts us on a 2Q event horizon at which there is no turning back.
When super-arsehole Tony Blair was taking utter gobshite about "the Third Way", of govt, prior to his being elected PM for the first time, it was clear that politics had completely run out of ideas and was fully reliant on majority stupidness of voters, and the undermining of short and medium term memories via systematic lies, bizarre distractions and completely daggy ad-hoc political contraption of the moment.
No matter who or what is put up as the 'answer' of the moment, either government, or no government, the result will always be dishonest arseholes wanting to take your property and to tax your work. A government will call it tax, and a non-government will call it user-pays.
Whatever, only the excuses will change, not the effects.
Frankly, non-government could only (possibly, and arguably not) 'work' if everyone else also decided to ditch government, otherwise those that don't ditch government will bomb and invade you to restore order and steal all that you have, to make the world a better and freer place.
"We came, we saw .. he died! Whhhahaahahahahahahaaaaah!"
Did you get up with the wrong foot first today?
What is this bullshit you're posting here - an obvious attempt in Perfect Solution Fallacy?
How about he goes after all the tax-avoiders and embezzlers of Govt funds? That would be a radical break from the past.
Until they stop the corruption nothing will change so lets see some pollies (Yes you Pap!) in prision too.
Are the Greeks still retiring at 50. That's got to stop. And does the Greek PM still earn twice as much as the German PM?
"This fucking guy is saving the planet from the bankers and oligarchs? Get the fuck outta here with this insane hero worship. He is offering NOTHING NEW. He may well help bring down the euro, but it will be an accident due to his insane big govt policies."
Yup, but they'll never learn (i.e. the people who fall for his stupid bullshit).
For fuck sake, there's still a relatively popular communist party in Russia.
I'm reminded of Jim Morrison's insightful sociological analysis of the common man:
"You'd all eat shit, wouldn't ya?"
Yes, but you must admit he makes the second sinking of the Titanic a lot more interesting than the previous guy did. All that remains to be seen is if he rides it down, or legs it to the last lifeboat before the big glug. I'm going with the latter.
OK, Mr. T is now the ZH sexiest man alive. But I was just wondering ... how does an anti-austerity socialist last five minutes without borrowing money? And who will lend him money?
Best of luck to you convincing them this guy isn't galloping in to save us all. I've been trying to do that all day and when people have responded it's mostly been childish attacks calling me names. Basically, you have the same response if you don't hero worship Putin. All these guys tend to forget that this is just another big govt statist who occasionally says some things we agree with. He will do the same things every other big govt statist does , and they will fail. I challenge anyone to find me an example of when any of this has worked.
It hasn't worked. It never does. Thats the point.
The current system si being held together with duct tape and chewing gum. If someone throws a broken wrench into this machine -- all hell will break loose. This is, at least, my objective.
What should scare us is what system emerges to replace the one we have now.
What system has a ground force inplace "edukating the masses"?
What system can incite the grass roots?
What system controls the media?
What system has been planning for 100 years?
.
Sounds like the Russians will.,.
There is one constant in history that is manifestly clear in this work: that the essential distinction between monarchy and republicanism (broadly speaking) is economic. Republics are normally oligarchies, or at least contain its seeds. Monarchies, since they are perpetually at war with their own nobility, often reject the assumptions of oligarchy. Whether it be the national socialist party of China or Belarus, the royal bank of St. Petersburg or the centralized dictatorship of the Augustan era, all forms of strong statism has made war on the banking monopoly. No authoritarian leader will accept competition from an all powerful economic mediator. Of course, there are a few exceptions on both sides, but history has been fairly clear that strong states, those based on traditional authority, reject the alchemy of money and interest.
http://www.sott.net/article/291745-Book-review-A-History-of-Central-Bank...
Three main forces rised in 20th century: Democracy, corporations and propaganda to save corporations from democracy.
Now you know why they do not like Putin, call him Putler. Both sides want the same bread, but Putin, as strong nationalist statists, wants to keep bread in Russia, while The City & Co want to Russia to be Greece way as was during 1990's. They started attacking Russia since Khodorovsky, Rothschild's agent, was put behind bars. The we can roll down thru those years, like murder of Litvinenko by Britain, Pussy Riot, gay law how =to behive on public, arrest of Greenpeace, Georgia war, Chechnia terrorists support...
So does that mean people who hate Leftists have no common sense?
That's because the Greeks were being rational, not greedy:
From Nick Dearden's article in the Guardian:
Greece and Spain helped postwar Germany recover. Spot the difference.
thanks for sharing ...
I'm kind of liking the whole 'ability to pay' thing. How about restricting the U.S. Government from borrowing any more than could be repaid by 3% of the total wages to it's citizens (not guest workers) every year MINUS all government employee wages?
I'll bet government would shrink so fast you would hear a sonic boom from the collapse of the resulting vacuum, and new, and private job creation would explode. Greed is a great motivator for psychopaths, even when it ultimately works against them.
Private job creation did explode with deregulation, privatization and free trade, just not in the interest of the majority, at home or abroad. Take the gov't out of the hands of the elite and it'll work just fine as it is.
@Arius
change your handle to Anus, will ya?
Arschloch
in case you missed it ...
http://www.theguardian.com/commentisfree/2013/feb/27/greece-spain-helped...
Another ignorant cunt who should be banned from ZeroHedge. (Walkure)
Geez, calm down. If mere ignorance were to get you banned from ZH, this'd be a very, very quiet place.
Yes indeed.
Your comment is on par with slavery reparations in the USA.
Most Europeans (99%) were either not born/living during WWII. Many of today's Europeans also got shafter after WWII by living behind the Iron Curtain. Bad shit happens... you either live with it or you use it as a handicap (i.e. My great-great-great-great-grand daddy was a slave - thus you owes me some cheddar).
Get over the Germany war repartations bullshit... The slavery reparations bullshit... The "shit that happened 70+ years ago" shit and move on.
To continue to puke up this same "you owe me" shit is beyond stupid.
Your comment is on par with slavery reparations in the USA.---------- No, it's not. German reparations were on the table at the Yalta Conference and after, and there was an agreement.
Greece scored the first victory against the Axis in defeating Italy, and delayed the Russia offensive several months, which ended up with the Germanss in Russia... in the middle of winter. That turned the tide in the War. Greece sacrificed one of the highest dealth totals as a % of its population.
The US and other countries shared in the spoils, but why shouldn't Greece? Your analogy comparing to slavery is false.
What is with (some?) libertarians and their belief history begins and ends with their personal experiences?
My father used to tell me stories; many of his teachers died of starvation and dead bodies were routinely seen on the streets. He also used to talk about how the Greeks paraded Mousolini's soldiers through the streets of Athens after they, not only repelled their attempts to cross Greek borders but took some swaths of Italian land. This was simultaneous to the rest of Eurpoe surrendering without fighting. Greeks also beat Hitler's first attempts at using paratroop drop into Greece. Greeks refused to hand over Jews to Hitler (though Germans still were successful in hunting them down). Greek Orthodox church openly stated that they would do everything in their power to provide a hiding spot for them (Israel still recognizes these deeds anually). In return for their insolence the maniacs in Berlin starved the entire nation once they finally used Panzer divisions to conquer it. Greece, like it or not, has a long trackrecord of taking the tough road and being on the right side of history. They need to return to this type of dignity and ornriness.
He's blaming the right people, but in fact, he said very little.
What exactly, does he propose?
He is going to halt the old agreement and barter for a new one.
"So, let me be frank: Greece's debt is currently unsustainable and will never be serviced, especially while Greece is being subjected to continuous fiscal waterboarding."
They will not be servicing the debt. Not gonna pay, cant pay anyway. Maybe in the future after the water boarding stops.
Exactly. The creditors will get some money, but only after Greeks begin to earn income again. The term of Greek debt just got extended a few decades.
How can they earn income when their few industries are not competitive using an expensive Euro as their currency?
Southern Europe having a DMark currency was never going to work for small non-indstrialized countries.
Finally! Someone hits on the productivity issue. Thank you, you're 100% correct.
He proposes to not wantng to hang from a light pole once the full truth comes out.
In a MillionDollarBonus kinda way
No he shouldn't. He is a big got statist , and I assure you he has wildly different ideas about the proper role govt than most of us. He is going to try the same old leftist shit that has been tried and has failed countless times. They are going to spend moar money they don't have, end up levying confiscatory taxes on what few successful businesses remain, and grow their already bloated govt even further , which will only further impoverish most Greeks. Don't get me wrong, I'm kinda glad they won since I believe this will contribute to the downfall of the euro, but it will be accidentally, and due to the inevitable failures of the policy this guy and his leftist ilk advocate.
They are going to stop spending Germany's money and spend their own money. You can get uptight about your political views but the point Tsipras' letter is making is that he doesn't want to owe Germany anything.
This isn't about my political views, this is about reality. How is anything I've said factually inaccurate. Where are they going to get all this money to spend?
Carl, I'm not sure but if he's not paying any Principle plus Interest payments back to the Troika then he has at least that amount of money to play with. Not sure how much that is though.
Wow. Look- they had to borrow the money to keep servicing their existing debt because they couldn't pay for it. They couldn't(and can't) keep servicing their existing debt without going further into debt. Even if you wipe out their debt completely , they are broke. This would also make it impossible for Greek businesses or people to get any kind of financing.
Exactly.... The abysmal failure of capitalist countries to rein in cronyism has created a situation where cronyism at all levels of finance and politics is so rampant that it is absurdly simple for communists to sound like rational people. They're not.
Is it really cronyism when the payments are going out the benefit the Free Shit Army which evidently included a large majority of the population?
This communist does not sound rational. He just sounds like any other criminal who blames their victim because the stolen money was too easy to take.
FSA now includes gov't debt and cash payouts. Germany's mistake was to lend real export profit money at real interest rates. Stupid Germans. Soon, Greece will look like American ghettos.
Whatever 'Free Shit Army' existed in Greece didn't get a dime of those loans. They either completely lost benefits or had them cut. What fucking part of that don't you understand??
All the cash for the loans when to making interest payments. The rest was stolen by Greek oligarchs.
There's no Free Shit Army lying on the beach in Greece collecting government paychecks. There's 80-year-old women begging for food in the streets.
mm, party true partly not. There are 900 thousand people on the public payroll, and hundreds of thousands pulling pensions and subsidies, all told about a third of the country is still living on the government tit (boo hoo they had their salaries and pensions cut, but they never stopped to think where was this money ever going to come from) while another one third is working its ass off paying taxes and another third is unemployed and losing hope. Tsipras is not there to save greece, but to save the state (so long as he dreams himself at the head of that state), if he has to throw greece under the bus, oh well nothign new there, same shit weve seen already.
However, it is also true that all this 'bailout' money of the recent years has gone directly to banks, mostly to foriegn banks. you got the pert about the bailouts entirley correct: greeks didnt see a dime of that money, the lion's share went to banks and the rest went into the oligarch's pockets as commission on the deal.
but when you have seen mass demonstrations in athens the past few years, keep in mind that those are unionized public servants rioting about pay and benefit cuts, they are part of the problem. In the 80s with the PASOK/papandreou dictatorship-in-all-but-name those public-sector parasites all too happily voted for those shitheads who offered them a job they never had to do any work for and could never get fire from it... they're the small potatoes parasites just as the oligarchs who bought them off with those crumbs are the big parasites. Tsipras has a lot of talk but lets see whether he doesnt just strip the few remaining small businesses into oblivion and confiscate whatever hasn't yet been confiscated. he and his ilk are statists, they'll sink the nation to save the state, you can count on it.
This, so much this. Thanks for posting it. All the lametards here on ZH just want to see someone doing something for the sake of it, but nobody mention the absolute disaster that Greece public spending has been for so many years. Basically it was a South American country in the Mediterranean, a place where you win elections by promising public contracts and unnecessary overpaid public jobs. Well, somebody has to pay for it. Luckily Greece can't devaluate (=make pensioners nad employees pay), so they better go seek the tax evader that have not paid a dime for decades!
PS: you guys should read Michael Lewis' "Boomerang", Greece's problems are wonderfully described there;, I'm surprised he doesn't get mentioned more often on this website...
I'm guessing you mean the chapter which reprints his 2010 Vanity Fair article, "Beware of Greeks Bearing Bonds". Thanks for the reminder!
I agree 100%. And I bet you this guys anti austerity hit home with all the govt employees and pensioners who were expecting a do nothing job they could pretend to work at until they were 50 years old, then retire with full pensions. Until this goes away , nothing is solved. It's much like American social security. Eventually you have more people taking out of it than paying into it, and it collapses. Your last part is especially true. Big govt statists will drive the entire citizenry into abject poverty and misery before those who run the govt take any cuts. They don't care about anything as long as the state remains. You sound like you are very familiar with particulars there.
+1000, I can't believe what I hear people say, and they conclude their terrible argument with, 'well, how's it any different than what we got?'
You really need to get over yourself and your political dogma. If I had to explain how wrong you are we would both lose the will to live; me because of the utter tedium of explaining to a monomaniac and you, because if you opened your mind, you'd realise how much energy you'd expended over time that might otherwise have been used to good effect.
More time than you just wasted typing that comment? Either correct me and have a discussion go away. All I've seen is inane statements like this and a few downvotes and I've yet to hear a coherent statement refuting anything I've said
Fair comment. There are lots of threads here, it's a complex picture and I seems to me unhelpful to basically take the view "all government bad, all taxation bad', which is the impression you give. What 'successful' businesses Greece has are concentrated in a few hands and have largely managed to avoid paying any taxes for years. The shipping industry is a good example. Their modus operandi has been to register under things like Panamanian flags, hire the cheapest labour they can find, almost invariably non-Greek, but manage to exploit various forms of EU largesse via the state. There has been an elite in Greece which has manipulated everything through right wing goverrnment cronyism and corruption. What Tsipras appears to be saying is that this has to change and that businesses need to get on board with everyone else in the country, something that hasn't happened in probably 40 years. His Finance Minister said on UK Channel 4 News on Wed., that the second bailout was not thought out and was effectively wished on the Greeks without any of the structural changes being implemented that were necessary to make the first bailout work and that the second bailout was far more than was required to actually address the problem. The money from both bailouts went straight to the banks who paid themselves and their cronies, there was no structured plan to put the money to work; just as in the UK, the people who ran up the debt by various means, i.e. the banks, were the sole beneficiaries of the bailouts, the Greek (and UK) electorate got berated and subjected to sado-monetary stringencies that in the case of Greece has resulted in a nation of beggars. When a people are able to work they can pay taxes and said taxes can go toward paying down the deficit. As we both know this is an over-simplification, but I hope you can see thge essential logic. Governments have to prioritise based on the real world, and in this world under the current dispensation, there is no prospect of either Greece or a number of other European countries ever paying their debts. One does not need a grasp of either economics or mathematics to work this out, just plain arithmetic. If you want a man to work for you he needs to be able to get off his knees, feed himself and somewhere to lay his head out of the elements. Increasing numbers of Greeks have been denied these luxuries. Give Tsipras and his team a couple of years to restucture Greek institutions and things weill start to move in the right direction, just dont expect the repeal of 40 years of bad governance overnight and try to accept the possibilities of good governance even if the complexion of its institutions doesn't fit with your political preferences.
Walktheline
Fair enough, thanks for the response. You make the point that so many have been able to avoid paying any taxes and manipulate the govt in their favor. I agree with you on that. That's how govts operate. They take care of themselves first, their friends in industry second, their underling employees and pensioners third, and if there is anything left, the peasants get some crumbs. That is how they ALL operate. My personal belief is that property rights are sacrosanct. You will probably say that most of these rich people lied or cheated their way to their wealth , and in a lot of cases that may be true. However, there are still at least some honest business people
And farmers left in that country, and THEY will end up being the only ones to actually suffer, not the elites, which is something else that always happens with govt schemes like this.
Also, instituting a 75% tax on high earners isn't going to bring in the money he thinks, and it's going to keep a lot of the economy underground , just like it is now. He is also promising too much, way more than he will ever be able to deliver in his parties manifesto. Greeces public sector was insanely bloated and their retirement and pension plans were way to generous to be sustainable. He promises to institute a nanny state that takes care of everyone, and no matter how much the govt takes from people, there is not enough wealth in that country for the gpvt to steal and redistribute to make this work long term.
Thanks for the reply. Tsipras strikes me as quite different from the usual run of politicians; I'm not even sure that he is a politician. We shall have to see how this plays out, but it's going to be a tough call, because as someone has already stated, Brussels and the banks everywhere will pull every nasty trick in the book. The fact that the departing govt stripped all the infrastructure out before leaving, computers etc, shows how this will be played. Tsipras has appointed people with real ability to his cabinet; wwe just have to hope that they're not merely dew eyed idealists.
Whatever ideological difference we may have, I think we'd both like to see these guys succeed in toppling the euro and helping to bring down the EU and beyond that the global Ponzi scheme that is international finance. We need a global reset that dispenses with the global mafia and gets back to some basic human values. Not holding my breath, but as the old Chinese saying has it: 'We live in interesting times'.
The Euro will fall, but it won't be any fucking 'accident.'
This is more good-cop, bad-cop, right/left Hegelian dailectic paradigm bullshit. This guy is right up there with Ron Paul, Nigel Farage, Marine le Pen (sp?), and Putin. All part of the 'hidden hand.' Don't buy into this BS but see THROUGH it.
The ultimate solution to all this (for them) is central, GLOBAL control, so no individual country's central banks can do shit like the FED and Swiss banks have done to fuck with world currencies - which is being done ON PURPOSE to drive the rabbits into the waiting arms of the BRICS. And the same, old, fucking smelly bastard FUCKWADS who run the current system.
Excuse me while I go sharpen my guillotine. I think I'll add a couple feet of height so I can put more notches on it too...
Actually his finance minister Vanis Varoukfakis should...
Tsipras is right that the loans can never be repaid. The problem is that a haircut on the debt is not sufficient either. Countries with completely different economic structures and needs cannot share the same currency without causing problems in at least one of them.
The best would be if Germany left the Euro. Then all those who stay can enjoy Draghi printing trillions, a weak currency and inflation, while Germany can get the strong currency people prefer.
If Germany leaves the Euro, the Euro is no more.
The best would be if al countries used a timeless form of money that is recognized as such throughout history which also can't be counterfeited by feckless central banks and politicians.
When was the last time you saw politicians vote for less govt?
Exactly.
So tell me again why the Euro and the EU will be dissolved?
The Euro Zone is politicians wet dream. It is not going anywhere.
which part of the EU is about "big govt"? sharing facilities? sounds like cost saving, doesn't it? interestingly... it is
the Euro? well, the treaties say that if you embrace the EUR, you embrace... balanced budgets. of course, it's a hard course. and so it generates lots and lots of political screaming and running around in circles
I always find it to funny that small gov proponents elsewhere so often fail to recognize the balanced budget proponents behind the EUR
We had better lives before the euro.
Greenskeeper is right, it was all about saving the banks and he should have stated that more clearly.
Of course, much of the bank debt problem resulted from the banks holding the Greek debt. And then those banks were given that Greek Haircut for all of their troubles.
Some make it sound as if these bankers really had a choice as to whether to buy the debt of their country. They did not. In fact they were even forced to allow the accounts of their customers to be plundered. The pols just passed some Laws requiring it. Then when for all of those years the Greek govt. took that money from the loans and funded operations of inefficient business operations it owned, paid out pensions that were too high, and failed to collect taxes, the resulting problems are now being laid at the feet of the banks. Typical method of all politicians.
Talks the talk but can he walk the walk. Could be an Obama clone.
It is also just simple bond math that extending the Greek debt to 18 years maturity (in the last rescheduling) and reducing the interest rate to 2.6% had the effect of massively decreasing the Net Present Value of the Greek debt load. So it's perhaps an over-simplification on his part to say that big concessions have not already been made by creditors.
Now perhaps there should be more concessions. But there needs to be movement on both sides absent outright default, which I don't think would be good for Greece in the long run. To be constructive, he should outline his plan to make Greece healthier.
+1 see there, a sensible, factual comment
This letter was published in Handelblatt on January 13th according to the Syriza website. It is great for background but it is also "old" news that should not be suggested as "current" news.
<i>they were bailing out big banks</i> and Greek oligarchs who stashed their wealth in Northern European banks to hide from equitable Greek taxes.
Wow, it's like this guy reads Zerohedge.
If I were him, I would avoid small planes, hot tubs, wine bars, nail guns, and tall buildings.
I'm sure there's got to be a drunk Russian on a snow plow somewhere in Greece? If you see that sucka' lined up at the local airport then you know the gig is on.
Is he blaming the cabal? Didn't think so.
You forgot shitgum in your list.
.
His statement reinforces my low opinon of Tzipras. He continues to skirt the truth of the banking manipulations. This is populist demagoguery. His appeal to German citizens is not trustworthy when it comes so soon after one of his first official acts taunting Germans as Hitler Nazis.
The guy should lay off talking to Germans and begin to seriously address Greeks to combat this crisis.
He won't do any of that because he can't. All he can do is talk about 'hope and change' type stuff, which should sound pretty familiar to our American readers. He proposes to 'end austerity ' but I have yet to hear a plan that details exactly how he is going to do that. They are broke. Even if they had all that debt written off, their economy is in shambles and there is no easy way out. There is no money for the govt to lavishly spend on social programs to lift Greece out of poverty. They can, and probably will, massively raise taxes on what productive enterprises remain in Greece but it won't do much good. The Greeks , and everyone else for that matter, keep making the same mistake in believing their govt can and will take care of them. It can't and it won't, not for long, anyway. Rather than looking to the govt for the answer, they should be getting the govt out of the way. Govt got them into this mess by having shysters like Goldman Sachs cook their books when they applied to join the euro, and govt over promised to its people and over indebted itself trying to pay for its unsustainable growth to the detriment of the greek people. Looking to the same institution to fix the problems it caused is the definition of insanity
Your thinking is retarded, your comments are retarded. Seriously, you're a fucking idiot.
Haha read his fucking manifesto, genius. All those things I said he would do, his party lists in plain English, even someone a dim as you should be able to understand. If you have something relevant to say, by all means. But if all you are going to do is post childish bullshit like this , you are nothing but a troll and I am done responding to you. Have a nice life, I'm sure you're doing great things with it.
It sounds good as far as it goes, but lots of things said by politicians sound good but are really lies. If you like your doctor...
I will refrain from further comments until I see a real budget out of this guy. I'm particularly interested in where he expects the money to come from on the income side of the ledger.
Wow, I wonder when he will get suicided. You start making too much sense in this insane world and nail guns start shooting without a carpenter...stange days.
Should have sent a CC: to Federal Reserve Bank, Wash. DC
Hats off to Alexis.
Greece is once again demonstrating she's a cradle of democracy. When everybody else is drowning in a perpetual credit-debt blabber, Greece can still retain a broader picture of the society within a much richer context.
Careful of your man crush. Though I think he has correctly characterized the problem, he has offerred no solutions, at least not in this article. Also, theory is easy but life is hard, and he will have all kinds of pressures, influences, and unexpected things to deal with. We'll see how he flows moving forward. What ever he does, there are no easy and painless so;utions. I wish him best of luck... he will need it.
Question 1: Is there anyone here who actually knows EU banking law and is familar with all the relevant treaties?
if so,
Question 2: What prevents Greece from re-introducing the Drachma, without (officially and externally) abandoning the Euro?
(since any solution, will inevitably involve either compromise, or a parting of paths- either amicable or hostile)
UR, not all of them to the most infinite detailed commentary, but yes:
there is nothing that prevents a member country to issue it's national currency on the side. in the eurozone, even private currencies are allowed and circulate freely
the point is debt, denominated in EUR, and taxation, currently denominated in EUR, too
there is nothing preventing a country to split some, by taxing some(thing) in EUR and some(thing) in Drachma, for example
further, nothing prevents a country like Greece to tax only in Drachma, and then exchange for EUR for debt service. since three quarters of the debt does not pay interest until 2023...
markets would go apeshit, then they generally don't understand much of this. diplomatic partners would be possibly a bit taken aback
the main question is this: where is the difference, at the end? because you either balance your budget or you borrow. that's the issue
(complicated by the fact that Tsipras could just refocus the Greek spending priorities without having to go to markets or EU partners for fresh funds)
-------
all things EU and EUR are based on treaties where sovereigns keep their sovereignty. it's an often misunderstood basic principle, mostly because most people have difficulties with the understanding of what treaties and sovereignty are. de facto, even treaties are, at the end, "living agreements". nevertheless:
in the most basic terms, the return of national currencies was always part and parcel of the EUR project. it's an important optionality. but a national currency needs either funds or taxation or both
the German Rentenmark, for example, was temporarily founded on all German private land. a kind of huge temporary mortgage. if Greece finds the risk is worth it... it could go this path
which could include a Drachma for internal national purposes only, btw. South Africa used a similar model
Restructuring the existing debt load and kicking the can to 2023 does no good if Greece cannot meet its current obligations. Everyone agrees that the inability to devalue at the national level within the EUR framework is a handicap. The last restructuring transformed the current period debt into into long debt, so the immediate issue is the (new and recurring) current period debt. If they are borrowing and paying in Drachmas, the NBG has more control over situation which would provide "flexibility" to officials in Athens. Whether they would actually seize the opportunity, is another issue.
This guy is a politician ? Rather amazing to hear the truth and good sense from one.
The Indian philosopher Sarkar wrote about the various groups which rule a civilization. The West has been dominated by the Acquisator types, the 'money junkies' for some time now. The rest of the population is fooled by the b.s. used to exploit and dominate them.
Thus the banksters (money junkies) can use ''loans' of Nothing, made up outta thin air - to manipulate the vast unaware. They use the same Nothing to appropriate the labor of people - including the intellectual propagandists in schools, the media & in the courts. They hire (with Nothing) the warrior types - physically capable but limited in viewpoint - in the military and police to enforce their tyranny on the general population.
Sarkar wrote that eventually the ruling group becomes so corrupt and impoverishes the people so much, that the regime falls.
About time !
https://en.m.wikipedia.org/wiki/Law_of_Social_Cycle
This "nothing" you refer to, is the power to command.
A faggot and a Commie huh?
Let's see what he asks for and he doesn't want something. Some great leader that wants another country to fix his problems. There's no distinction between asking for more debt and debt relief. He's just another politician promising everyone the world. His mouth is writing cheques his ass can't cash.
Let's hope he doesn't get on any small planes.
Man crush,eh?
This guy is a snake oil salesman far better than Obama,but his ultimate message is as invidious as his obvious model,The One,ie "just suspend reality,and Utopia will come"
What a jerk-off..
Nazi were fighting against Jewish Bolshevism in USSR and Zionist Banking Mafia in Britain and the USA. Greek people were fighting against German people.
Yesterday, Greek people had a very good life borrow money from Germany and enjoying their parasitic existence. Today, Greece is very upset that this life is over and they have to pay their credit cards debts. I don't feel sorry for them. They got exactly what they deserved.
A declaration of war against all Germans and Germany. Okay, Greeks, if you want war you can have it.
Not sure how someone can come up with that conclusion after reading the letter. In any rate, the Greeks can always turn eastward if the Euro's don't want to play ball... and stick the banks and their derivatives with the bill.
auf wiedersehen assholes