The austerity mongers, who have essentially ravaged economy after economy around the world, are on the brink of destroying Greece. But, Yanis Varoufakis, Greece's finance minister, isn't ready to be broken.
Yesterday, the austerity mongers had another hack at Greece:
IT WAS 18 against one on February 16th, for the second time in less than a week. The Eurogroup of finance ministers presented Yanis Varoufakis (pictured right), their Greek colleague, with a draft statement that he rejected as “absurd” and “unacceptable.” The meeting, which had been billed as a last chance for Greece to reach a deal with its creditors before its current bail-out expires on February 28th, broke up acrimoniously. Later, the Greek government claimed that an earlier version of the statement, which it deemed acceptable in principle, had been replaced with a “radically different text” demanding that the bail-out be extended.
Jeroen Dijsselbloem (pictured left), the Dutch Eurogroup chairman, brushed aside Mr Varoufakis’s objections, insisting that there was still “time and ample room” to agree a deal. The bridging loan that Greece is seeking was simply a different word for a bail-out extension, he said. But Alexis Tsipras, the radical left prime minister whose Syriza party won last month’s Greek election on an anti-austerity platform, would lose credibility both with voters and, more important, his party’s far left if he were to climb down. Observers in Athens predict more posturing before Mr Varoufakis makes a last-minute U-turn and agrees a deal.
To be clear, the vote does not tell the story. The pressure being exerted on Greece comes principally from Germany--the most obsessed of all austerity mongers--and the International Monetary Fund, whose historic role is to impose austerity measures in return for badly needed loans and, then, no matter the circumstances, keep its boot pressed firmly against the neck of any country that dares utter a peep. And they are surely being rooted on by the Pete Petersen's of the world who run around
hyping multiple phony debt and deficit crisis scenariosas a cover for slashing-and-burning society's social spending and principled spending on the needs of people.
Germany:
Earlier Monday, the German finance minister, Wolfgang Schäuble, told German radio that he was “very skeptical” about the chances of a deal. He also accused the anti-austerity Greek government of behaving “pretty irresponsibly.” Mr. Schäuble said Mr. Tsipras was “insulting those who have helped Greece in the past few years.”...
In response to Mr. Schauble’s remarks, the Greek government spokesman, Gavriil Sakellaridis, told a Greek radio station, “I could also say that Germany’s behavior is irresponsible, but I don’t want to trade characterizations.” He added, “Who is irresponsible and who is responsible is subjective.”
Athens wants “a solution on the political level,” Mr. Sakellaridis said. “We don’t see this like a game of poker. Neither are we bluffing.”
The IMF:
Christine Lagarde, the managing director of the International Monetary Fund, which has a lending agreement with Greece until early 2016, also prodded Greece to accept a continuation of the bailout.
“If an extension is sought by the Greek authorities from the Eurogroup and addressed with a commitment to continue to consider the current program, then we continue to work together,” she told the same news conference. But by failing to stick to commitments that the I.M.F. still needed to assess in a coming review, Greece would risk not receiving its loan disbursements, she suggested.
In the midst of all the calls for more austerity from Germany and the IMF,
Varoufakis penned a thoughtful and, for The New York Times, humorous oped today. Varoufakis spent a lot of time in his academic career writing about and thinking about game theory. But, he says this negotiation isn't about game theory with bluffs and strategies played out in some abstract way:
The great difference between this government and previous Greek governments is twofold: We are determined to clash with mighty vested interests in order to reboot Greece and gain our partners’ trust. We are also determined not to be treated as a debt colony that should suffer what it must. The principle of the greatest austerity for the most depressed economy would be quaint if it did not cause so much unnecessary suffering.
I am often asked: What if the only way you can secure funding is to cross your red lines and accept measures that you consider to be part of the problem, rather than of its solution? Faithful to the principle that I have no right to bluff, my answer is: The lines that we have presented as red will not be crossed. Otherwise, they would not be truly red, but merely a bluff.
But what if this brings your people much pain? I am asked. Surely you must be bluffing.
The problem with this line of argument is that it presumes, along with game theory, that we live in a tyranny of consequences. That there are no circumstances when we must do what is right not as a strategy but simply because it is ... right.[emphasis added]
And:
One may think that this retreat from game theory is motivated by some radical-left agenda. Not so. The major influence here is Immanuel Kant, the German philosopher who taught us that the rational and the free escape the empire of expediency by doing what is right.
How do we know that our modest policy agenda, which constitutes our red line, is right in Kant’s terms? We know by looking into the eyes of the hungry in the streets of our cities or contemplating our stressed middle class, or considering the interests of hard-working people in every European village and city within our monetary union. After all, Europe will only regain its soul when it regains the people’s trust by putting their interests center-stage.[emphasis added]
Stand strong, Greece.
And added, from The Wall Street Journal, posted a few minutes ago (1:48 PM EST):
Greece will seek an extension to its rescue deal from the rest of the eurozone Wednesday, an official with knowledge of the situation said, marking an apparent shift in the standoff between Athens and its creditors that has raised questions over the country’s future in Europe’s currency union.
The extension could be for a period of four to six months to prevent the current loan agreement from expiring at the end of the month, the official said, adding the conditions of the request were still under negotiation.
The comments came shortly after Greek Prime Minister Alexis Tsipras gave a defiant speech in Parliament in Athens, saying his government would move to immediately dismantle overhauls mandated by its bailout program and calling for European leaders to hold a summit on his country’s funding needs. On Monday, eurozone finance ministers gave Greece an ultimatum to request an extension, after abruptly cutting short negotiations over what conditions could be attached to new aid.