Greek Referendum Poll

[Admiral Yi]

If you cut public spending in most European countries, you also take away purchasing power that keeps people in jobs in the private sector and amount to economic growth and tax base.
Austerity measures only worsen and excerberate the consequences of economic crisis. One things' declining exports, but if you can't keep national demand up, where are you going to get revenues?

Is this for me?

[Crazy_Ivan80]

Therefore there is no political will in the West to make sure Greece succeeds.

Greece will only succeed if the Greeks want it to succeed. So far they haven't. No amount of Western money will change that if they Greeks themselves don't change their attitude towards their state. So why waste more money?

You make a good German 

Greece didn't succeed because they didn't want to?  The extreme austerity of the past years had nothing to do with the failure?

extreme not implementing what they promised, not opening up their closed shop of an economy and not reforming their state-apparatus. As I've said in the other thread: the Greek state is a cesspool of clientilism and nepotism. It has been for a long time. Because of that -or maybe it's the reason why the greek state is so badly organised- the Greek citizenry has not reason to trust their state, and acts accordingly. The last few decades have not shown an inclination amongst the Greek electorate to elect parties that want to clean up this mess.

If Greece wants to stop defaulting every 30 years or so they'll have to change. A lot. This is going to be very hard. It would be much much harder, and the changed they'd need to make far more radical,  if they had to get funding at normal market rates rather than the easy on the wallet rates they're getting from the other eurozone-members.

[The Minsky Moment]

Your point being? Greece and the Eurozone should solve their matters according to concepts of American private law? If so, it's Chapter 11 and liquidation for Greece I guess.

That wasn't my point but now that you mention it Chapter 11 -- which is not a liquidation -- would be a big improvement.

[Zanza]

Greece didn't succeed because they didn't want to?  The extreme austerity of the past years had nothing to do with the failure?

Greece was already very sick when the doctors from the Troika prescribed their blood-letting. Austerity surely made matters worse, but the root cause of Greece's malaise is way older than 2010.

No argument.  I like your metaphor. Like Middleage medical practitioners, once the Troika became involved the chances of a positive outcome diminished significantly.

The perverse thing was that the combined the Middle Ages practice with 21st century life support and homeopathic medicine.

[crazy canuck]

Greece didn't succeed because they didn't want to?  The extreme austerity of the past years had nothing to do with the failure?

Greece was already very sick when the doctors from the Troika prescribed their blood-letting. Austerity surely made matters worse, but the root cause of Greece's malaise is way older than 2010.

No argument.  I like your metaphor. Like Middleage medical practitioners, once the Troika became involved the chances of a positive outcome diminished significantly.

The perverse thing was that they combined the Middle Ages practice with 21st century life support and homeopathic medicine.

 

[crazy canuck]

Therefore there is no political will in the West to make sure Greece succeeds.

Greece will only succeed if the Greeks want it to succeed. So far they haven't. No amount of Western money will change that if they Greeks themselves don't change their attitude towards their state. So why waste more money?

You make a good German 

Greece didn't succeed because they didn't want to?  The extreme austerity of the past years had nothing to do with the failure?

extreme not implementing what they promised, not opening up their closed shop of an economy and not reforming their state-apparatus. As I've said in the other thread: the Greek state is a cesspool of clientilism and nepotism. It has been for a long time. Because of that -or maybe it's the reason why the greek state is so badly organised- the Greek citizenry has not reason to trust their state, and acts accordingly. The last few decades have not shown an inclination amongst the Greek electorate to elect parties that want to clean up this mess.

I wonder how difficult it might be for any nation to reform its political system and politics in a period of a few years.    And then I wonder how much more difficult it will be now.

[frunk]

If Greece wants to stop defaulting every 30 years or so they'll have to change. A lot. This is going to be very hard. It would be much much harder, and the changed they'd need to make far more radical,  if they had to get funding at normal market rates rather than the easy on the wallet rates they're getting from the other eurozone-members.

If they are that dysfunctional why the hell are they in the Euro?  Kick them out, let them inflate away their debt and get their house in order and review their situation in 10-15 years.  The rest of the Eurozone isn't going to get them to straighten up and fly right by forcing austerity down their throats, not unless they are willing to take direct control of the civil service and political system.  It will succeed at making many people bitter and resentful of Germany, the Euro and the European system in general.  This is a greater threat to the Euro than letting one state leave (or for that matter working out a less severe program for Greece's problems).

All of the bailouts have just been a way to prolong the pain without improving anything apart from the perspective of the original creditors.  I'm predicting that even if Greece passes the set of reforms that things won't change much on the ground.  There will still be widespread corruption, the Troika will have to decide if there is "enough" reform that it meets their demands or there will have to be another set of negotiations for even greater oversight/control versus Grexit.

[Zanza]

I wonder how difficult it might be for any nation to reform its political system and politics in a period of a few years.

As Germany has been taken as an example before...
Four years between the end of the Third Reich and the establishment of Germany's current liberal democracy. The Greek crisis is already in its fifth or sixth year...

[Zanza]

If Greece wants to stop defaulting every 30 years or so they'll have to change. A lot. This is going to be very hard. It would be much much harder, and the changed they'd need to make far more radical,  if they had to get funding at normal market rates rather than the easy on the wallet rates they're getting from the other eurozone-members.

If they are that dysfunctional why the hell are they in the Euro?  Kick them out, let them inflate away their debt and get their house in order and review their situation in 10-15 years.  The rest of the Eurozone isn't going to get them to straighten up and fly right by forcing austerity down their throats, not unless they are willing to take direct control of the civil service and political system.  It will succeed at making many people bitter and resentful of Germany, the Euro and the European system in general.  This is a greater threat to the Euro than letting one state leave (or for that matter working out a less severe program for Greece's problems).

All of the bailouts have just been a way to prolong the pain without improving anything apart from the perspective of the original creditors.  I'm predicting that even if Greece passes the set of reforms that things won't change much on the ground.  There will still be widespread corruption, the Troika will have to decide if there is "enough" reform that it meets their demands or there will have to be another set of negotiations for even greater oversight/control versus Grexit.

I think you are preaching to the choir.

[crazy canuck]

I wonder how difficult it might be for any nation to reform its political system and politics in a period of a few years.

As Germany has been taken as an example before...
Four years between the end of the Third Reich and the establishment of Germany's current liberal democracy. The Greek crisis is already in its fifth or sixth year...

But as you rightly noted before.  That transition was enforced by the occupying forces - in both the West and the East.  With the added benefit of having the support of the US in the West

[crazy canuck]

If Greece wants to stop defaulting every 30 years or so they'll have to change. A lot. This is going to be very hard. It would be much much harder, and the changed they'd need to make far more radical,  if they had to get funding at normal market rates rather than the easy on the wallet rates they're getting from the other eurozone-members.

If they are that dysfunctional why the hell are they in the Euro?  Kick them out, let them inflate away their debt and get their house in order and review their situation in 10-15 years.  The rest of the Eurozone isn't going to get them to straighten up and fly right by forcing austerity down their throats, not unless they are willing to take direct control of the civil service and political system.  It will succeed at making many people bitter and resentful of Germany, the Euro and the European system in general.  This is a greater threat to the Euro than letting one state leave (or for that matter working out a less severe program for Greece's problems).

All of the bailouts have just been a way to prolong the pain without improving anything apart from the perspective of the original creditors.  I'm predicting that even if Greece passes the set of reforms that things won't change much on the ground.  There will still be widespread corruption, the Troika will have to decide if there is "enough" reform that it meets their demands or there will have to be another set of negotiations for even greater oversight/control versus Grexit.

I think you are preaching to the choir.

[Zanza]

Now that's something Syriza should reform...

[Zanza]

Schäuble is now openly defying Merkel and is telling the press that Grexit would have been a much better solution. I wonder if she'll tolerate that for long.

[Legbiter]

The IMF says Greece will need a lot more debt relief and regular transfers from Mutti.

A secret International Monetary Fund study showed Greece needs far more debt relief than European governments have been willing to contemplate so far, as Germany heaped pressure on Athens on Tuesday to reform and win back its partners' trust.

The IMF's stark warning on Athens' debt was leaked as Greek Prime Minister Alexis Tsipras struggled to persuade deeply unhappy leftist lawmakers to vote for a package of austerity measures and liberal economic reforms to secure a new bailout.

The study, seen by Reuters, said European countries would have to give Greece a 30-year grace period on servicing all its European debt, including new loans, and a dramatic maturity extension. Or else they must make annual transfers to the Greek budget or accept "deep upfront haircuts" on existing loans.

The Debt Sustainability Analysis is likely to sharpen fierce debate in Germany about whether to lend Greece yet more money, while it will be seen by many in Greece as a vindication of the government's plea for sweeping debt relief. A Greek newspaper called the report a slap in the face for Berlin.

German Finance Minister Wolfgang Schaeuble made clear in Brussels on Tuesday that some members of the Berlin government think it would make more sense for Athens to leave the euro zone temporarily rather than take another bailout.

An orderly Grexit would be a bargain it seems.

http://www.reuters.com/article/2015/07/14/us-eurozone-greece-idUSKBN0P40EO20150714

[Razgovory]

So?  This doesn't change the fact that no austerity means more money is needed.

See, this is what confuses me.  Yi talks about Austerity working if it actually increases debt, then exactly what is it accomplishing?  Greece could increase it's debt without wrecking it's economy.