Monday, July 13, 2015

Greek and the Euro continued

There was a real chance for things to change last week in Greece.  As I mentioned, it would have been very painful, but there was chance to move beyond the terrible status quo.  Into something temporarily worse, perhaps, but what happened- a last minute deal which forces Greek PM Alexis Tsipras to renege on all of his bluster, and which renders pointless the referendum he held last week- is not a best-case scenario. 

          History, I think, will not be kind to Mr. Tsipras.  This entire ordeal is master class in political assery.  Yes, the Greek economy has avoided a disastrous default, but Tsipras’ position is weaker for the months of posturing and fist-shaking, his European partners are pissed off, the population is pissed off, and whatever political capital he had accumulated has evaporated overnight.

          What’s more, we’ll be here again. This is not the first time Greek has been “rescued” from the brink by EU funding.  And it won’t be the last as long as nothing changes.  The old line about insanity meaning doing the same thing over and over again but expecting the different results applies here.  As long as the terms don’t change, Greece won’t really recover.  It might work its way back to some kind of stability, but unsustainable debt is unsustainable debt.  You can keep a starving man alive by throwing him a handful of crackers every once in a while, but don’t tell me that’s a solution.     

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