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The Silent Anschluss: Germany Formally Requests That Greece Hand Over Its Fiscal Independence

Tyler Durden's picture


Update 2: the first local headlines are coming in now, from Spiegel: Griechenland soll Kontrolle über Haushalt abgeben (loosely Greece must give up domestic control), and Kathimerini: Germany proposes Greece relinquish some fiscal powers, sources say

Update: Formal Greek annexation order attached.

It was tried previously (several times) under "slightly different" circumstances, and failed. Yet when it comes to taking over a country without spilling even one drop of blood, and converting its citizens into debt slaves, Germany's Merkel may have just succeeded where so many of her predecessors failed. According to a Reuters exclusive, "Germany is pushing for Greece to relinquish control over its budget policy to European institutions  as part of discussions over a second rescue package, a European source told Reuters on Friday." Reuters add: "There are internal discussions within the Euro group and proposals, one of which comes from Germany, on how to constructively treat country aid programs that are continuously off track, whether this can simply be ignored or whether we say that's enough," the source said.' So while the great distraction that is the Charles Dallara "negotiation" with Hedge Funds continues (as its outcome is irrelevant: a Greece default is assured at this point), the real development once again was behind the scenes where Germany was cleanly and clinically taking over Greece. Because while today it is the fiscal apparatus, tomorrow it is the legislative. As for the executive: who cares. At that point Goldman will merely appoint one of its retired partners as Greek president and Greece will become the first 21st century German, pardon, European colony. But at least it will have its precious euro. We can't wait until Greek citizens find out about this quiet coup.

More from Reuters:

The source added that under the proposals European institutions already operating in Greece should be given "certain decision-making powers" over fiscal policy.


"This could be carried out even more stringently through external expertise," the source said.


The German demands for greater control over Greek budget policy comes amid intense talks to finalize a second 130-billion euro rescue package for Greece, which has repeatedly failed to meet the fiscal targets set out for it by its international lenders.


It is likely to spark a strong reaction in Athens ahead of elections expected to take place in April.

"Strong reaction?" Is that the politically correct parlance for "civil war" these days? We must be out of the loop on that one...

The specific language that strips Greece of its sovereignty and which will be plastered over every front page in the Greek media tomorrow:

Budget consolidation has to be put under a strict steering and control system. Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time. A budget commissioner has to be appointed by the Eurogroup with the task of ensuring budgetary control. He must have the power a) to implement a centralized reporting and surveillance system covering all major blocks of expenditure in the Greek budget, b) to veto decisions not in line with the budgetary targets set by the Troika and c) will be tasked to ensure compliance with the above mentioned rule to prioritize debt service.


The new surveillance and institutional approach should be formulated in the MoU as follows: “In the case of non-compliance, confirmed by the ECB, IMF and EU COM, a new budget commissioner appointed by the Eurogroup would help implementing reforms. The commissioner will have broad surveillance competences over public expenditure and a veto right against budget decisions not in line with the set budgetary targets and the rule giving priority to debt service.” Greece has to ensure that the new surveillance mechanism is fully enshrined in national law, preferably through constitutional amendment.

And here is the full formal pre-annexation order:


In the meantime, Greeks are already practicing the switchover in the national dance:


And after.


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Sat, 01/28/2012 - 06:47 | 2105223 Kevlar Akubra
Kevlar Akubra's picture

The Greeks make nice pastries and lamb

The Germans make cars for da man

We could all clearly see

What was going to be

The end for the EEC plan

Sat, 01/28/2012 - 07:45 | 2105269 Mitzibitzi
Mitzibitzi's picture

My personal opinion is that we'd probably all be better off if Europe, including the UK, DID merge into one huge superstate, with the German model applied to it.

Only fly in the ointment is... it wouldn't be German policies, common-sense and business practices that would end up being implemented across Europe. It'd be the banks / corporations and their 'must squeeze every drop of blood from the debt slaves' mentality, as always.

Never going to happen, though. There are too many people Europe-wide, if more concentrated in some countries than others, that have gotten used to the easy life. Most of those peeps ain't gonna easily take to the idea that they might actually have to work for a living, or that they should do it for more than 20 years before retiring in comfort. Will take some severe and widespread combination of War, Death, Famine and Pestilence before the message starts to sink in.

Sad, really.


Sat, 01/28/2012 - 08:00 | 2105276 Mitzibitzi
Mitzibitzi's picture

And, before the red arrows start to pile up, my point is that the idea that the majority can have an easy life, with their consumption far outweighed by their production, was a stoopid one to start with. If you want some limited governance, crime prevention, firemen, doctors and nurses, etc, then EVERYBODY else must produce more than they consume to support them, as they are essentially non-productive in even a loosely capitalist society.

Big-Anything (agri, oil, pharma, banking, government, whatever) is incompatible with that. They all prefer massive operations with a maximum of automation and a minimum of manpower (except government, which would like to employ everyone in society inefficiently and pay them all from the public purse - not exactly easy to finance that one, so it's equally retarded!), refusing to invest in almost anything that can't be run on a huge scale. This takes a huge chunk of what should be productive capital out of the economy and puts it in the hands of a few. Who keep it, despite already being rich beyond the dreams of avarice.

Small is beautiful, in that regard. But if you must have big, and it seems humans in general prefer that, I'd sooner run it with 'the Germans' in charge than 'the Greeks'.

Sat, 01/28/2012 - 07:47 | 2105270 Laretes
Laretes's picture

Hey, let us win at at least one war alright?

Sat, 01/28/2012 - 08:44 | 2105290 lolmao500
lolmao500's picture

LOL. This time, don't attack Russia and you'll win.

Sat, 01/28/2012 - 08:25 | 2105284 hero HNL
hero HNL's picture

This is very good for Greece....get rid of a corrupted, wall street-controlled govt & replace it with a dictatorial govt.

Dictators install law & order and that is what the Greeks need.....or else the whole world will end up like california. Much better than becoming dysfunctional like the ussa & the Germans can rule with an iron hand.





Sat, 01/28/2012 - 08:34 | 2105286 Pizza man
Pizza man's picture

Gosh, not so many comments about how the fucking GREEKS shat in their own bed and slept in it, year after year. ..If I was going to have to bail out a bunch of lazy assholes, i would extract some HARD assurances 1) I could get piad back and 2) They don't take my cash and then hold default over my head for more cash. Say what you will about our German cousins, but you cannot call them stupid.

Sat, 01/28/2012 - 08:46 | 2105293 lolmao500
lolmao500's picture

The Greek got fucked by Goldman Sachs cooking the books and the government giving empty promises. Yeah it's half the Greeks fault for believing that crap, but guess what, the US and most of the western world is in the same state of affairs.

Sat, 01/28/2012 - 08:34 | 2105287 Pizza man
Pizza man's picture

Gosh, not so many comments about how the fucking GREEKS shat in their own bed and slept in it, year after year. ..If I was going to have to bail out a bunch of lazy assholes, i would extract some HARD assurances 1) I could get piad back and 2) They don't take my cash and then hold default over my head for more cash. Say what you will about our German cousins, but you cannot call them stupid.

Sat, 01/28/2012 - 09:11 | 2105312 Gavrikon
Gavrikon's picture

They were stupid enough to loan money to the PIIGS.  Fuck the German banks.  They are just as stupid as thoe in the US.

Sat, 01/28/2012 - 08:34 | 2105288 Raskolnikoff
Raskolnikoff's picture

Easier would be to just let whoever loaned to this country take their losses. Natural Selection while maybe suspect in the biological world sure would solve many problems in the financial world.

Sat, 01/28/2012 - 08:58 | 2105304 lolmao500
lolmao500's picture

Yep. Whoever gave money to Greece, WELL TOO FUCKING BAD BITCHES, YOU MADE A BAD INVESTMENT! Time to lose your money now!

Sat, 01/28/2012 - 08:54 | 2105300 pauhana
pauhana's picture

The European Commission has just announced an agreement whereby English will be the official language of the European Union rather than German, which was the other possibility.   As part of the negotiations, the British Government conceded that English spelling had some room for improvement and has accepted a 5- year phase-in plan that would become known as "Euro-English".

In the first year, "S" will replace the soft "c". Sertainly, this will make the sivil servants jump with joy. The hard "c" will be dropped in favour of "k". This should klear up konfusion, and keyboards kan have one less letter.  There will be growing publik enthusiasm in the sekond year when the troublesome "ph" will be replaced with "f".. This will make words like fotograf 20% shorter.

In the 3rd year, publik akseptanse of the new spelling kan be expekted to reach the stage where more komplikated changes are possible.   Governments will enkourage the removal of double letters which have always ben a deterent to akurate speling. Also, al wil agre that the horibl mes of the silent "e" in the languag is disgrasful and it should go away.

By the 4th yer people wil be reseptiv to steps such as replasing "th" with "z" and "w" with "v".

During ze fifz yer, ze unesesary "O" kan be dropd from vords kontaining "ou" and after ziz fifz yer, ve vil hav a reil sensi bl riten styl.   Zer vil be no mor trubl or difikultis and evrivun vil find it ezi TU understand ech oza. Ze drem of a united urop vil finali kum tru.   Und efter ze fifz yer, ve vil al be speking German like zey vunted in ze forst plas.
If zis mad you smil, pleas pas on to oza pepl.

Sat, 01/28/2012 - 09:30 | 2105328 lolmao500
lolmao500's picture

That was brilliant!

Sat, 01/28/2012 - 13:19 | 2105520 frosty zoom
frosty zoom's picture

millions of dollars are squandered every year because of the stupidity of english spelling.

think every office, every day, all those spell-checks.

plus, it's cruel to little kids  --  we make kids feel guilty because they can't spell "the tough coughs as he ploughs the dough".

your proposal would save billions.



Sat, 01/28/2012 - 18:36 | 2106065 akak
akak's picture

I once tried to explain the concept of the English language "spelling bee" to a Spanish speaker --- they were at first dumbfounded, then appalled, then amused; no such activity or even concept exists for them, as Spanish is almost perfectly phonetic, so once you know how to pronounce a word, 99.9% of the time you know how to spell it.

Sat, 01/28/2012 - 09:09 | 2105310 Gavrikon
Gavrikon's picture

Great, now Greece now has more motiviation to exit the Euro.  Since the German bank where I work has put 15% of us on the street in order to keep the big bosses' bonuses high, I couldn't care less what happens to the banks.  Fuck them.  GO ahead and default, dear Greek people!

Sat, 01/28/2012 - 09:19 | 2105320 supermaxedout
supermaxedout's picture

Whats the f.. is the problem?

Greece is bankrupt and the existing government is not capable to make the necessary radical changes. .

The governemt structures  in Greece are corrupt beyond imagination. Thus the state is stuck and paralyzed to offer anything to the Greek population.  So there is simply no local structure existing capable to make progress to the better.

To give up the right of the budget to the EU or Germany if one wants to say so is not a big thing for the Greeks. Simply for the fact, that when you dont have a money than you dont have a budget. So the fact is, that Germany has to give the money (more or less) to finance the Greek state. This means they want to know how its spent and if it does make sense, to ensure that one day the Greek state is self sustainable at least to a great extent. Then the job is done.

There is no practical alternative. You can not give money to the Greek government and expect its used in a way it works for the population overthere. This is simply not working as the past showed.  So somebody else has to do it. Who else could that be? Who is giving the money instead of the EU or to be more precise Germany? Nobody!

Thats why Im sure, that the overwhelming part of the Greek population is happy that the country is more or less governed from outside through the budget restrictions. At least for a time till more effective structures are implemented.  In three to five years the turnaround in Greece can be managed. Greece is not poor and has rich natural resources and a population willing to change the structures of the state to the better.  Its one of the most beautiful countries in this world. So the future looks not bad at all. Its just not happening overnight and its a hard piece of work for Greece but they can do it for sure.

Sat, 01/28/2012 - 09:38 | 2105341 moonstears
moonstears's picture

How's things in Davos? Umm, so you think Euro accountants will make sure that the Greek common man gets the Eurobucks and that the Greek people will rave for this crackdown on their sovereign government, by outsiders. Hey, I've smoked a little dope in my time too, but it doesn't REALLY make you smarter, or drive better, you're just stoned. Remember this. IMO.

Sat, 01/28/2012 - 10:11 | 2105363 hourglass86
hourglass86's picture

If Greece is bankrupt then WTF ARE UK,USA AND JAPAN???? ROFL

Sat, 01/28/2012 - 09:29 | 2105326 rsnoble
rsnoble's picture

New Jersey votes to outlaw guns jan 30. Get the word out:

Sat, 01/28/2012 - 09:36 | 2105338 lolmao500
lolmao500's picture

I spread it, thanks!

Sat, 01/28/2012 - 09:32 | 2105332 HD
HD's picture

Using the German logic - shouldn't US tax payers be in full control of Citi, BOA, AIG and the rest?

Sat, 01/28/2012 - 09:39 | 2105342 lolmao500
lolmao500's picture

They should have been put down like the rabid dogs they are.

Sat, 01/28/2012 - 09:37 | 2105339 props2009
Sat, 01/28/2012 - 09:41 | 2105343 lolmao500
lolmao500's picture

Bullish :

New U.N. draft resolution gives Syria 15 days to comply OR ELSE

Sat, 01/28/2012 - 09:55 | 2105352 HD
HD's picture

Yea, or else Syria. Bet they don't want else. There will be else breaking loose all over the place and nothing they can do about it.


"Adopt further measures" I guess that means the UN will unfriend Syria on facebook.

Sat, 01/28/2012 - 10:10 | 2105361 Greekanal
Greekanal's picture

You guys dont understand anything


The Jews who run ECB and EU are not showing their faces and they just use Merkel and Germany as a decoy to take the blame and hate from Greece and other middle age countries.


Same thing and same people behind the fraud in Occupied States of America and now same plan for Occupied European Union

Sat, 01/28/2012 - 12:48 | 2105461 frosty zoom
frosty zoom's picture


no, no, no!


Sat, 01/28/2012 - 10:16 | 2105367 Karl Napp
Karl Napp's picture

Transfer the money and shut up bloody Germans!! Freedom for Greece.

Sat, 01/28/2012 - 10:16 | 2105368 Karl Napp
Karl Napp's picture

Transfer the money and shut up bloody Germans!! Freedom for Greece.

Sat, 01/28/2012 - 10:20 | 2105372 The Count
The Count's picture

Greece is up.

Italy is on deck.

Portugal is in the hole.

Spain is in the deep hole.

Sat, 01/28/2012 - 10:33 | 2105376 HD
HD's picture

 Okay...did anyone else find that whole thing dirty?

Sat, 01/28/2012 - 11:33 | 2105399 The Alarmist
The Alarmist's picture

I advocate for a forced disposal of Greece to Turkey. The EU countries can use the money that was going to go to the EFSF and ESM to bail out their own banks (hey, this was where the money was going anyway, but this way cuts out the pesky middlemen) for the "losses" they will take on their Greek debt, and the EU gets the added benefit of calling this a nice consolation prize to Turkey for turning it away from EU membership.

Sat, 01/28/2012 - 11:35 | 2105402 lolmao500
lolmao500's picture

Yeah... I'm sure people are gonna like that.

And giving away people like that is sick.

What's next... eastern Europe go back to Russia when they go bankrupt? Southern US to Mexico? Etc..?

Sat, 01/28/2012 - 11:53 | 2105411 PORTA PORTA
PORTA PORTA's picture

'Germany Was Biggest Debt Transgressor of 20th Century'

SPIEGEL ONLINE: Mr. Ritschl, Germany is coming across like a know-it-all in the debate over aid for Greece. Berlin is intransigent and is demanding obedience from Athens. Is this attitude justified?


Ritschl: No, there is no basis for it.


SPIEGEL ONLINE: Most Germans would likely disagree.

Ritschl: That may be, but during the 20th century, Germany was responsible for what were the biggest national bankruptcies in recent history. It is only thanks to the United States, which sacrificed vast amounts of money after both World War I and World War II, that Germany is financially stable today and holds the status of Europe's headmaster. That fact, unfortunately, often seems to be forgotten.

SPIEGEL ONLINE: What happened back then exactly?

Ritschl: From 1924 to 1929, the Weimar Republic lived on credit and even borrowed the money it needed for its World War I reparations payments from America. This credit pyramid collapsed during the economic crisis of 1931. The money was gone, the damage to the United States enormous, the effect on the global economy devastating.

SPIEGEL ONLINE: The situation after World War II was similar.

Ritschl: But right afterwards, America immediately took steps to ensure there wouldn't be a repeat of high reparations demands made on Germany. With only a few exceptions, all such demands were put on the backburner until Germany's future reunification. For Germany, that was a life-saving gesture, and it was the actual financial basis of the Wirtschaftswunder, or economic miracle (that began in the 1950s). But it also meant that the victims of the German occupation in Europe also had to forgo reparations, including the Greeks.

SPIEGEL ONLINE: In the current crisis, Greece was initially pledged €110 billion from the euro-zone and the International Monetary Fund. Now a further rescue package of similar dimensions has become necessary. How big were Germany's previous defaults?

Ritschl: Measured in each case against the economic performance of the USA, the German debt default in the 1930s alone was as significant as the costs of the 2008 financial crisis. Compared to that default, today's Greek payment problems are actually insignificant.

SPIEGEL ONLINE: If there was a list of the worst global bankruptcies in history, where would Germany rank?

Ritschl: Germany is king when it comes to debt. Calculated based on the amount of losses compared to economic performance, Germany was the biggest debt transgressor of the 20th century.

SPIEGEL ONLINE: Greece can't compare?

Ritschl: No, the country has played a minor role. It is only the contagion danger for other euro-zone countries that is the problem.

SPIEGEL ONLINE: The Germany of today is considered the embodiment of stability. How many times has Germany become insolvent in the past?

Ritschl: That depends on how you do the math. During the past century alone, though, at least three times. After the first default during the 1930s, the US gave Germany a "haircut" in 1953, reducing its debt problem to practically nothing. Germany has been in a very good position ever since, even as other Europeans were forced to endure the burdens of World War II and the consequences of the German occupation. Germany even had a period of non-payment in 1990.

SPIEGEL ONLINE: Really? A default?

Ritschl: Yes, then-Chancellor Helmut Kohl refused at the time to implement changes to the London Agreement on German External Debts of 1953. Under the terms of the agreement, in the event of a reunification, the issue of German reparations payments from World War II would be newly regulated. The only demand made was that a small remaining sum be paid, but we're talking about minimal sums here. With the exception of compensation paid out to forced laborers, Germany did not pay any reparations after 1990 -- and neither did it pay off the loans and occupation costs it pressed out of the countries it had occupied during World War II. Not to the Greeks, either.

SPIEGEL ONLINE: Unlike in 1953, the current debate in Germany over the rescue of Greece is concerned not so much with a "haircut", but rather an extension of the maturities of government bonds, i.e. a "soft debt restructuring." Can one therefore even speak of an impending bankruptcy?

Ritschl: Absolutely. Even if a country is not 100 percent out of money, it could still be broke. Just like in the case of Germany in the 1950s, it is illusory to think that Greeks would ever pay off their debts alone. Those who are unable to do that are considered to be flat broke. It is now necessary to determine how high the failure rate of government bonds is, and how much money the country's creditors must sacrifice. It's above all a matter of finding the paymaster.

SPIEGEL ONLINE: The biggest paymaster would surely be Germany.

Ritschl: That's what it looks like, but we were also extremely reckless -- and our export industry has thrived on orders. The anti-Greek sentiment that is widespreadin many German media outlets is highly dangerous. And we are sitting in a glass house: Germany's resurgence has only been possible through waiving extensive debt payments and stopping reparations to its World War II victims.

SPIEGEL ONLINE: You're saying that Germany should back down?

Ritschl: In the 20th century, Germany started two world wars, the second of which was conducted as a war of annihilation and extermination, and subsequently its enemies waived its reparations payments completely or to a considerable extent. No one in Greece has forgotten that Germany owes its economic prosperity to the grace of other nations.

SPIEGEL ONLINE: What do you mean by that?


Ritschl: The Greeks are very well aware of the antagonistic articles in the German media. If the mood in the country turns, old claims for reparations could be raised, from other European nations as well. And if Germany ever had to honor them, we would all be taken the cleaners. Compared with that, we can be grateful that Greece is being indulgently reorganized at our expense. If we follow public opinion here with its cheap propaganda and not wanting to pay, then eventually the old bills will be presented again.


SPIEGEL ONLINE: Looking at history, what would be the best solution for Greece -- and for Germany?

Ritschl: The German bankruptcies in the last century show that the sensible thing to do now would be to have a real reduction of the debt. Anyone who has lent money to Greece would then have to give up a considerable part of what they were owed. Some banks would not be able to cope with that, so there would have to be new aid programs. For Germany, this could be expensive, but we will have to pay either way. At least Greece would then have the chance to start over.

Interview conducted by Yasmin El-Sharif

Albrecht Ritschl, 51, is a professor of economic history at the London School of Economics. Born in Munich, he previously taught as a professor at the University Pompeu Fabra in Barcelona, the University of Zürich and Berlin's Humboldt University.


Sat, 01/28/2012 - 11:54 | 2105412 Great Depressio...
Great Depression Trader's picture

Watched Greek news last night (sat morning in Greece) where they go thru all the newspaper headlines and not A SINGLE MENTION OF THIS! Of course it doesnt really surprise me as for the last year the info we get from ZH gets reported on Greek tv a few weeks later.

Greek news basically report on the demands of the troika, the cuts on workers, unemployment and the perennial tax evation.

Sat, 01/28/2012 - 12:07 | 2105421 Irish66
Irish66's picture

I was reading English version of Greek newspaper and no news of this either.

Sat, 01/28/2012 - 12:14 | 2105426 lolmao500
lolmao500's picture

They'll just announce it when it's signed and all.

Sat, 01/28/2012 - 12:19 | 2105428 loveyajimbo
loveyajimbo's picture

We should get together with the Krauts this time... China, russia and even Japan are turning against us... we need allies.  France will surrender as soon as they hear a car backfire, Tiawan is too small, Austrailia does not nhave any military, Africa is already Chinese...


But who would want Greece?  I would take Spain or Portugal...


Ron Paul makes sense sometimes, yes?

Sat, 01/28/2012 - 12:38 | 2105434 Schmuck Raker
Schmuck Raker's picture

Some Greeks might welcome Regime Change...

A commentary published yesterday on by Nikos Xydakis:

The nation’s bankrupt ruling class is a complete stranger to ability, to willpower, and to cognizance of the historical moment. All it has is an unquenchable thirst for power --even if it means exercising it among ruins.

Any hope for recovery presupposes this elite’s exit from the political stage so as to make way for fresh forces. It may be humiliating, but a strong intervention of foreign officials in our domestic affairs would accelerate this process.

No, I'm not suggesting it would be for the best. I just think it's important to keep in mind that there is always more than one point of view to be considered.


Sat, 01/28/2012 - 13:43 | 2105566 frosty zoom
frosty zoom's picture

as of this post there are 42 matches for "hitler" on this page.

well, 43 now..

we need to counterbalance this:

reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  reagan  

Sun, 01/29/2012 - 09:27 | 2107042 Schmuck Raker
Schmuck Raker's picture

The Holy Trinity of idol worship remains incomplete:

Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis Elvis


Sat, 01/28/2012 - 13:58 | 2105608 PORTA PORTA
PORTA PORTA's picture

Oil n Natural Gaz resources of Hellas/Greece...

This is the name of the game..




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