06 julho, 2015



Greece on the edge…

As I had expected, the Greeks voted OXI! NO. However, the massive victory (61%) surpassed my best expectations.

Regardless of personal beliefs, it was a remarkable exercise in Democracy, up to Greece’s historical credentials on the issue.

First, because the Greeks asserted their free will in excruciatingly hard circumstances, including strict capital controls.

Second, because they did so defying the will of great powers and international financial institutions.

Third, because they resisted the blatant and unforgivable pressure and blackmail from foreigners such as Schulz, Juncker, Schauble, Dijsselbloem and Merkel. Besides being undignified and illegitimate, these bullying tactics are incredibly stupid because they are most likely to backfire.

Now what?

Well, it is anybody’s guess. Although Varoufakis’ resignation is not a good omen*, Alexis Tsipras has a stronger hand to play. He has got renewed legitimacy – on top of the electoral legitimacy, he has a specific mandate to make a strong stand in Brussels. Concurrently, the Troika’s hopes of an imminent collapse of the Syriza government have vanished for the foreseeable future.

So, much will depend on the Germany’s-Troika’s stance. Tonight, the leaders of Germany and France are meeting in Paris to decide what the Eurozone will do going forward. There are two fundamental options:

1- A vengeful stand. Infuriated by the Greek voters’ defiance, Berlin may choose to punish their daring by keeping the Troika’s terms unchanged. This would probably force Athens to default and resuscitate the Drachma, but it would hurt Germany’s image even further. It would also lead to a period of uncertainty and instability in the Eurozone.

2- After the referendum’s cold shower, a more constructive attitude. This would entail addressing some of Athens’ main aspirations in a way that would give the Greek economy a decent chance to recover and the Greek government the possibility of fulfilling the gist of its democratic commitments to the Greek people.

The first reactions are mixed but are not promising. France and Italy signalled some flexibility but they do not count so much nowadays as they are seemingly incapable of standing up to Germany from whom one has heard no positive messages.

I am mildly pessimistic, because the Germany/Troika approach to this kind of negotiations has consistently been to press and bully their targets into submission (check “Erros da Grécia” at http://tempos-interessantes.blogspot.pt/2015/05/erros-da-grecia.html). Enabling Greece to get away with a fair and reasonable deal, could open a breach in the wall to be explored by others.

Then, we still have to factor in the zealot followers of Germany in Portugal and Spain, whose ruling parties are clearly more interested in their electoral prospects than in the well-being of the Portuguese and the Spanish people.

It will still take the Greeks a lot of courage and resilience to resist and overcome the approaching onslaught. Never showing signs of relenting may be the key to success.


* Shedding Yanis Varoufakis because he is not well liked by his counterparts is a gross mistake. The other countries have to deal with whoever represents Greece. The Greeks certainly do not like the despicable Wolfgang Schauble and that certainly will not lead Mrs. Merkel to dismiss him. Lack of resolve is the last thing Mr. Tsipras can afford to show to his opponents.


P.S. When this post had already been written, I learned that the ECB kept the freeze on the emergency liquidity assistance to the Greek banks. This means that the Greek banks will run out of cash sometime in the next few days, unless the Bank of Greece overrules the ECB’s decision. So, the strategy seems to be to keep on squeezing the Greeks.



“GREEK Q&A” em






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