"After 90% of the financial aid went to the banks both foreign and domestic, we shall now proceed to sell off our public assets so our banking system doesn't collapse."
Democracy at work, people.
Edit:
Here's the actual agreement:
It was so shortsighted and precocious to put the bailout terms to a referendum. It left them only the option to betray their people. If Greece was playing Poker, they had a 2-7 off suit and tried to bluff with it. Except that everyone knew they had a bad hand.
Greece votes to play the hand they're given and they don't seem to realize that they have no play until they get home broke.
What would you expect Tsipras to do (and how bad is it that the title of the article spells his name wrong) when his people are going to face economic collapse? He got home, sobered up, and realized he had made a really stupid mistake and that even though he doesn't like the terms that he has no better option.
It's democracy. The Greeks put him in office. The Greeks voted to reject the bailout offer last week, and this is a different, although very similar, offer. Democracy fails all the time. Having the mass uninformed electorate making decisions and expecting that they vote to support themselves in the long-run at the cost of their short-run selves is a huge gamble. Tsipras thought he could get away with it, but they have a bad hand and Germany didn't even blink. Not even a week later and they're doing exactly what they should have last week.
You don't get to buy and buy and buy and then skip out on the bill.
Agreed. I don't know why people see Greece as a victim. It is clear that austerity was too tough and the conditions of the bail-out should have been very different, but they still got bailed out when they were in deep trouble. Greece is better off that the IMF & ECB stepped in.
I knew someone deeply entrenched in financial logic would eventually show up and declare the coming sellout of the Greek people well justified. Bonus points for comparing someone who "buys buys buys" and eventually has to pay to the entirely different realm of state finance.
Surprise, the banks are getting saved and public infrastructure is going to be sold to profiteers. Also, the people will bleed. Another fine day in Neolib-land. So nice to always be able to rely on upright citizens explaining how it couldn't possibly be any other way!
Well, thanks for pointing out the typo, I guess. I'm curious, since you asked. How bad was it? On a scale of 1 to 10, where 1 is "banks saved, poor eat dirt" (everything okay) and 10 is "Investors making less return on their investments" (Red alert, end of the world is imminent)?
In my view, being "deeply entrenched in financial logic" (as you put it) simply means having a basic understanding of how our financial system works. Whether we feel the current crisis is a "sellout" or take the stance that Greece is getting exactly what they deserve is beside the point. Markets are indifferent to such opinions - the trick is to learn how to navigate and make the most of the (admittedly) broken system we have.
In that respect, I feel yellowoftops post is spot on. Tsipras never really had a choice. Is it fair that Greece is at the mercy of creditors today? Well, about as unfair as the cheap credit Greece received for no reason other than their initially joining the Euro. Is it fair that the current government is burdened by the past administration? Of course it is - government debt carries over, no matter which party is in power. That's just the way it works.
So, yes - I can sympathise with the flood of news that's surely to continue coming about ordinary Greeks suffering. But blaming the "system", instead of the Greeks themselves, seems to me at least like blaming predatory lending for one's own poverty. The fact that no one forced Greece into the Euro makes this an issue of ignorance more than malice, and such ignorance is not wont to go unpunished.
- So, yes - I can sympathise with the flood of news that's surely to continue coming about ordinary Greeks suffering. But blaming the "system", instead of the Greeks themselves, seems to me at least like blaming predatory lending for one's own poverty.
- Is it fair that Greece is at the mercy of creditors today? Well, about as unfair as the cheap credit Greece received for no reason other than their initially joining the Euro.
- Markets are indifferent to such opinions - the trick is to learn how to navigate and make the most of the (admittedly) broken system we have.
- one's own poverty.
Hmm, you do have a valid point. Guess I was too caught up in defending "how the financial system works is logical" that I ignored your main point - that it is still far from being transparent or fair to the many, many regular folk caught by those decisions. I guess the financial and political elite in my country are doing a (reasonably) good job managing our system, which is why your argument didn't immediately appeal or make sense to me. Thanks for clarifying!
- Bonus points for comparing someone who "buys buys buys" and eventually has to pay to the entirely different realm of state finance.
Greeks don't have a such thing as state finance. That's the whole fault of the Euro to begin with. It's absolutely absurd to have a monetary, but no political or fiscal, union. The ordinary rules of money printing don't work when the state isn't controlling their own money supply. I think if nothing else, this saga has really highlighted the shortcomings of the Euro, and shown it to be what it really was designed to be in the first place: a way for the strong economies of Europe to sell exports easier.
It's not really like there's a lot of room for sovereign decisions left, is it? What can you do if you're handed control of the train in the middle of the trainwreck, long after the chance to change tracks or hit the breaks has passed? I'd simply expect everyone else to stop making things worse for profit and think about how casualties could be minimized. I can't believe how Merkel and Schäuble are acting (Except I can, really, because they are obviously acting in the interest of financial elites). We Germans, of all people, should realize that mistakes can be made. Germany would never have recovered if it wasn't for extensive debt forgiveness. One might argue that the sins of my country included slightly more serious transgressions than fiscal irrsponsibility.
The Greek should work towards an orderly exit of the Euro zone and establishment of a national currency. Make it non-fiat while you're at it. All the "weak" countries should get out. In the interest of German people, as well. As long as the exports are rolling, I suspect our elites will continue to not give a crap about domestic demand. Wages and social policies reflect that.
You can be entrenched in in financial logic (which I don't think it is an insult to be logical) and still agree that making a monetary union without making a political one is a dangerous game. This is a post in which we were discussing that same idea the other day.
However, fixed currencies don't work. They cause deflation when supply of one product constricts supply of money. If you were to work to offset that change and re-value money in new terms of gold, then you're not really bound to a standard anyway and you're working as a central bank. It was abandoned a long time ago because it doesn't work. Any standard (not just gold) should work the same way.
>vote to support themselves in the long-run at the cost of their short-run
I wonder what the average Oxi voter imagined would happen if Greece left the euro, I can't imagine they would have thought that things would increase in the short-term.
They were voting against austerity, which cost them pension and social welfare benefits. Many who were voting against austerity likely also expected that their economy was being held back by austerity measures and wanted growth. They were voting to get growth and benefits.
A few years ago I remember running into a snarky comment that went something like "The EU is the German Empire without the Kaiser".
Not that Greece itself is innocent in all this, but the Eurozone "powers that be" are using this to impose what Naomi Klein calls "the shock doctrine" on Greece.
Noam Chomsky explained that the bottom 70% of the US population has no political control, despite marches, protests and/or votes. Influence increases as income rises, with the final biggest influence going to the top 1% of income earners. This state of political powerlessness for most of the population is called plutocracy.
Greek people clearly thought they were in a democracy, when really they (and I would imagine most of the Eurozone) live and operate in functional plutocracy.
Chomsky was quoted somewhere on Hubski recently...who's the wizard who remembers, and can give us a link?!
deepflows , it was you who made the comment! Thanks for finding the link.
Yes, Chomsky is a smart man; interesting how the best linguists are often also scientists and social justice activists. This sentence could be true any way you write it: the best social justice activists are also scientists and linguists, the best scientists are also linguists and social justice activists. Seems like a whole brain thing.
'best' in this case is defined as: most useful at focusing on the physical, mental, emotional and spiritual health and well-being of individuals and society.
Thinkers like Chomsky always end up at the understanding that some kind of anarcho-syndicalism is required to straighten out the problems with top-heavy power structures, such as politics:
- [anarcho-syndicalism] is a conception of a very organized society, but organized from below by direct participation at every level, with as little control and domination as is feasible, maybe none.
What I like about anarcho-syndicalism compared to straigt anarchy is this part:
- as little control and domination as is feasible
Because I firmly believe that you have to have some degree of control. Someone has to control those who would otherwise drive when drunk, kill for fun and rape for pleasure. Someone has to have the power to deal with people who would harm themselves or others because of mental illness.
Again, with Chomsky:
- “Anarchism is… a tendency that is suspicious and skeptical of domination, authority, and hierarchy… It asks whether those systems are justified. It assumes that the burden of proof for anyone in a position of power and authority lies on them… If they can’t justify that authority and power and control, which is the usual case, then the authority ought to be dismantled and replaced by something more free and just.”
It's not the first time a referendum in the EU hasn't meant anything.
https://en.wikipedia.org/wiki/Twenty-eighth_Amendment_of_the_Constitution_Bill_2008_%28Ireland%29
Referendums and to some degree voting in general only exists because they can lend legitimacy to policy decisions. And if they don't? Time for "realpolitik". Financial realities, you see.
The way I read the whole ting, Tsirpas and Varoufakis knew that the EU had them by the balls. It was either "accept being colonialized" or "crash". But they couldn't accept the conditions since they got voted into office on a promise of putting an end to the exploitation of the Greek people. They were hoping that the Greek would be scared enought to vote "Yes" to the EU plans. That way, they could have accepted the terms and justified it with "the people have spoken". But the Greeks said "Oxi". A day later, Varoufakis resigns. He knew what was comming.
Good point about the timing of Varoufakis' resignation.
>they couldn't accept the conditions since they got voted into office on a promise of putting an end to the exploitation of the Greek people
I really wonder what they were thinking back in Dec/Jan. They campaigned on ending austerity, the people voted "No", months later supporting their campaign promises, and when push came to shove they folded immediately. What were they hoping would happen or what were they hoping to accomplish?
I can't see how this won't end the government. The next election in Greece is going to be...interesting.
Before we all strike the Greek PM for being weak or declaring that democracy has failed, let us remember that the European technocrats pushed the Greeks into this situation (along with, of course, the Greek economy being run by cronyism and corrupt bureaucrats for such a long time) - what choice did Tsipras have? Let his people suffer unimaginably because Germany and its coalition in the EU refuses to really help?
Personally, I blame the financial elites who helped create this situation (Hello, Goldman) and the politicians on both sides who allowed the country to slide further into this no-win situation. Five years ago, this whole situation could have been handled quite less dramatically.
But Goldman, Deutsche Bank & friends were still heavily invested. Sure, it was obvious that the situation wasn't sustainable, but as long as profits were to be made, they were making them. Fast forward to now and the banks have absorbed the so called bailout money while the Greek are left with an impossible situation. Mission "Profits = Private, Losses = Socialized" has been a success once again. How surprising.
So, no, I'm not blaming the current greek PM for being in a situation without good outcomes. But democracy? I don't really see how democracy could fail anyone in the US or the EU. We'd have to actually have it, first. What did fail us once again was our system of financial plutocracy. But that's the whole point of a plutocracy.
I'm reluctant to sound so defeatist about the entire thing. Yes it is a plutocratic system in this sense - in that big banks are really holding sway over governmental decisions. But let's not just go hailing the death of democracy just because the plutocrats are winning at the moment. Democracy has always been a long struggle of the common people versus the elites, like a pendulum, and we've not yet lost that struggle.
Hey, I'll happily grasp at any straw you have on offer. I just can't see it right now. I really don't want to sound defeatist. It's just quite hard to remain optimistic when, year after year of following events, discussing them and looking for solutions, things only ever seem to go in one direction.
Media is under corporate control, money firmly rules the world (phony as our monetary system may be) and the people seem quite content with their bread and games. I'm also not sure we have all that much time left for meaningful change to happen. I mean, sure, there will be change, but I'm not sure it'll be the kind of change you or I envision.
There isn't any historical precedent for the current situation (or is there??). This plutocracy has gone global and I'd say that our democratic systems have been subverted beyond recognition. A catastrophic crisis on a global level will of course shake things up, yet so far our plutocrats have proven quite capable of not letting a good crisis go to waste.
So... how do you see meaningful struggle happening?
Plutocracy went global before - the Gilded Age had various corporations have control over nations in a way that we can't even imagine - yes there was less transnationalism in their activities but even still. What we need is a bunch of leaders (akin to FDR or Teddy Roosevelt) that can utterly subvert the plutocrats and break up these massive corporations again. It has happened before and it can happen again.