Greek elections 2015’s version.

[SeanF]

While I agree that a lot of damage has been done to southern Europe, I am not sure what the reason has been. The south has prospered over many years. Or so it looked like at this time. Much more than,say, Germany. Many southern countries (not sure about Greece) still have much more property per capita than in the North.

It's only now that everyone seems to know how awful everything always has been.

What I am afraid of is, that the Euro and of course austerity is identified as the only problem that needs a solution. There must be something else that is not right.

Anyway, lets see whether Tsipras is smarter than us. The immediate stop of privatization is very commendable. I am not so sure about the employing of all those public employees. Are they the useful ones or those who just have been in the job because of party affiliation and/or corruption? Not that it matters too much, the state ought to feed it's citizens one way or another.

The South boomed, because Euro membership allowed them to borrow money at German interest rates, and then they went bust when they couldn't repay these debts.

The theory was that Euro membership would force Italy, Greece, Portugal, and Spain to become more competitive, by preventing them from devaluing their currencies, the traditional means by which they had remained competitive. In a way, that has happened, as all four countries now have primary budget surpluses, and balance of payments surpluses. The cost has been massive unemployment, particularly youth unemployment, eye-watering cuts in public spending, and sharp reductions in real wages.

[The Marquis de Leech]

Have I understood this correctly?

Greece is incapable of ever being productive enough to pay for the lifestyles its citizens demand.

It is incapable of doing so while tied to the Euro.

[Bright Blue Eyes]

Well, this is an interesting tactic from the new Greek Prime Minister:

http://m.democracynow.org/headlines/2015/1/27/40421

How much has Germany already transfered to Greece? How will this "you owe us reparations for WWII tactic" play with the German electorate?

65 billions or thereabouts, not counting the help from the EU where Germany pays 27% of all tabs.

And of course the reparations have been settled since 1953 and again in 1991. The only issue that may have some merits are 11 billions about a forced loan, which could be constructed to be different from the reparations settled in those two treaties. Theoretically.

Nobody's ever going to touch that stuff though. There are so many legal inconsistencies, it would probably cause WWIII. Like Germany getting half of Poland back while Poland gets half of their eastern neighbours. All stuff that has long been cooperatively settled but would prove to be illegal according to international law. Half the world has done legal somersaults to avoid that issue.

That tactic isn't received well. Most people want to count the reparations against the debts of Greece and then kick Greece out of the Euro, demand every debt to be paid in full and not a single cent of help for Greece anymore, starving children be damned.

[Jon's Queen Consort]

Simply Greek politicians' stuff.

Τhe ex Prime minister Antonis Samaras didn't *handed* the prime ministership as usual, to the new prime minister.. But his associate gave it to new prime minister's associate. Like a 5 yo doesn't give up a toy that is not his.

Also another of the ND ex ministers, Adonis Gergiadis before the elections had said that if SYRIZA will be #1 he will leave from Greece. Since he didn't acted like he said some people made a site which counts the time till he leaves Greece http://www.koolnews.gr/wp-content/uploads/2015/01/istoselida-dioxnei-adonis-georgiadi-480x360.jpg

[Maithanet]

As an American who has only followed the Greek crises to a limited extent, I don't understand why Greece would want to stay on the Euro. Yes, leaving would be terrible. But if their currency devalued, at least tourism would increase(which is the country's #1 industry), so they wouldn't be totally broke, only somewhat broke. And what is the alternative? Is there a light at the end of the tunnel where Greece is actually able to regain a sound economic footing? Because lurching from one crisis to the next indefinitely seems like the worst possible plan.

[SeanF]

As an American who has only followed the Greek crises to a limited extent, I don't understand why Greece would want to stay on the Euro. Yes, leaving would be terrible. But if their currency devalued, at least tourism would increase(which is the country's #1 industry), so they wouldn't be totally broke, only somewhat broke. And what is the alternative? Is there a light at the end of the tunnel where Greece is actually able to regain a sound economic footing? Because lurching from one crisis to the next indefinitely seems like the worst possible plan.

There possibly is light at the end of the tunnel within the Euro (Greece now has a primary budget surplus, and a trade surplus), provided they're willing to accept flat living standards, and very high unemployment for the next 20 years or so.

Leaving the Euro, and reinstating the drachma would cause all kinds of mayhem in the short term, but would very likely lead to a rapid recovery within the medium term.

[Bright Blue Eyes]

As an American who has only followed the Greek crises to a limited extent, I don't understand why Greece would want to stay on the Euro. Yes, leaving would be terrible. But if their currency devalued, at least tourism would increase(which is the country's #1 industry), so they wouldn't be totally broke, only somewhat broke. And what is the alternative? Is there a light at the end of the tunnel where Greece is actually able to regain a sound economic footing? Because lurching from one crisis to the next indefinitely seems like the worst possible plan.

Greece got like 500 billions untaxed capital offshore and the like.

Anyway, leaving the Euro won't help - the debts aren't in Drachma. Greece would have to get hard currency to repay them.

[Maithanet]

There possibly is light at the end of the tunnel within the Euro (Greece now has a primary budget surplus, and a trade surplus), provided they're willing to accept flat living standards, and very high unemployment for the next 20 years or so.

Leaving the Euro, and reinstating the drachma would cause all kinds of mayhem in the short term, but would very likely lead to a rapid recovery within the medium term.

Flat living standards and very high unemployment for the next 20 years sounds astonishingly bad.

Anyway, leaving the Euro won't help - the debts aren't in Drachma. Greece would have to get hard currency to repay them.

They would default on those debts. I thought that was assumed to go along with any Eurozone exit. They would have trouble accessing capital at anything like reasonable rates for the next 50 or so years. That still seems like a small price to pay to avoid the scenario above.

[Alarich]

I don't know if Greece would recover so easily

1. Their debt is not in Drachma, but in Euro.

2. The new debt, that Greece would necessaily incur to finance the public sector spending would come at huge interest-rates.

3. The rapid devaluation of the Drachma will make imports extremely expensive, probably cutting back most of their "currency" advantage at least in the export-sector.

[kiko]

I think that Greece has to go the way of Iceland. They have enough resources to go their own way. Tourism and farming are their biggest assets anyway. Not sure,how much logistics is providing. I have the feeling that most of the earnings don't stay in the country. If it does - even better.

Iceland seems to be able to survive with fishing and ignoring angry creditors. Why shouldn't that work for Greece as well?

That would mean no more Olympic games and tanks in the foreseeable future. But those people who suffer right now probably won't care.

[paddington]

If Greece leaves the Euro, won't that increase the pressure for say Italy, Spain leaving?

[arya_underfoot]

It is incapable of doing so while tied to the Euro.

So then why are they so attached to the euro? The hope that the German taxpayer will keep on subsidising their lifestyles?

[Jon's Queen Consort]

So then why are they so attached to the euro? The hope that the German taxpayer will keep on subsidising their lifestyles?

So you believe that the Greek people have done nothing and they are expecting from others?

Most Greek people, from those I know anyway, want Greece out of EU for various reasons. Is Europe going to let Greece exit?

[Galactus]

So you believe that the Greek people have done nothing and they are expecting from others?

Most Greek people, from those I know anyway, want Greece out of EU for various reasons. Is Europe going to let Greece exit?

I suspect many wouldn't mind Greece leaving; It would provide a strong warning example.

[Galactus]

People turn to the populists when the "mainstream" is so awful. The Euro has done immense damage to the inhabitants of Southern Europe. Unsurprisingly, they resent it.

Greece has seen GDP per head fall by 30% since 2008. That's a far sharper decline than even the USA experienced in 1929-32.

Considering a large portion of the problem was fake Greek statistics....

[Jon's Queen Consort]

I suspect many wouldn't mind Greece leaving; It would provide a strong warning example.

Or could also be a example for other countries who feel oppressed by the EU. Also if what is discussed in many *cycles* inside and outside of Greece happen, Greece asking for War reparations from Germany, then other countries will do the same. For some reason I don't believe that Germany can handle it. Also there is the matter of the illegal immigration. Now the illegal immigrants pass from Greece to the rest of the Europe, if Greece exit EU the illegal immigrants will have to go through Italy. For some reason I don't believe that Italy would be thrilled with that.

[Ser Scot A Ellison]

Does anyone see any validity to Greece's prospective war reparations demand from Germany?

[Jon's Queen Consort]

Does anyone see any validity to Greece's prospective war reparations demand from Germany?

In midDecember I listened it at the news. According to those news some French, Austrian and British newspapers had started to rake up the matter again in Europe. However it was never really dead in Greece.

[Ser Scot A Ellison]

JQC,

Should Russia be able to demand reparations from France for Naploeon's invasion?

[Jon's Queen Consort]

@SSAE, did I ever said that I agree? I don't think so.

For me it should be either: a. Greece just exit from EU, go back to Drachma and exploit their industry or b. follow the Iceland economic model.