Exit Polls Suggest Syriza Has Won Greek Election

[C0ckney]

I said before that it's not realistic to expect Greece to repay all its debt. However, when you offer debt relief you want to make sure that the debtor doesn't simply continue with the ways that got itself into trouble. Germany wasn't offered debt relief so that it could go straight back to invading its neighbours and slaughtering Jews. And that's consistently been the problem with Greece the past years: they've been given 2 bailouts in which prior debt was written off or restructured, bringing down interests payments as a share GDP to below Italy's. In return they were supposed to carry out reforms to bring their finances on a surer footing, but they've often been incapable and unwilling to do so, even when they're plainly in their own interests as is the case with the land registry farce. And now we have a Greek government that actually wants to go straight back to the old ways while at the same time requesting new loans.

The Greek can get themselves a stable of ponies for every woman and gold-plated Ferrari for every man for all I care, but FFS they have to do with their own damned money.

And again, if they the Troika hadn't bailed out Greece (with loans that were substantially cheaper than market loans), they would have had to default. Then they would no longer have been able to plug the gap with debt, meaning they'd have had to cut back expenses and raise new revenues irregardless, only far more drastically. Within weeks, not years.

Just ****ing default already.

now you see this is exactly what i mean by framing. the way you've written it, it seems like the international community tried its best to save greece, but the incorrigible greeks just wouldn't mend their ways and now find themselves in a desperate situation because of it. it's not surprising that people have the views they do, when the issue is framed thus. however, this view of events has nothing to do with reality.

the problem with greece at start of the crisis was that it had a debt (caused by lax public finances) that it couldn't pay. the plan to 'save' it was not to write off the debt, but to give greece loans and impose conditions that would inevitably shrink the economy; on its face the plan appeared to be absolute madness: a country that couldn't pay its debts being offered more debt as a solution.

it's important to understand the motivations of those involved. default for greece would have meant leaving the euro, possibly the EU; in other words humiliation for any mainstream national politician (and we must not forget just how attached to the EU mainstream politicians in the EU are) who took that course. on the EU side everyone was worried that a greek default and exit would provoke contagion: the other PIIGS leaving the euro and a banking collapse; perhaps you recall the various reports from banks predicting famine, war, and pestilence if greece defaulted, which could be summarised thus: banks say banking collapse would be bad.

if we look at the 'rescues' as if they were intended to resolve greece's problems, then they appear completely unworkable and an abject failure; they appear absurd in fact (and this was pointed out at the time). however, if we look at them as if they were intended to save the euro and shore up the banking system, then they make sense, and have in fact worked. the euro is still standing and banking system, while still somewhat shaky, is in much better shape than it was in 2008/9. the greek people though have paid the price. they were given a plan which couldn't possibly have worked and were blamed for its failure.

[Imran Siddiqui]

Like a payday loan, basically (the we'll lend you money to pay off your other owed money).

Contracting your government spending when you are facing a recession will, of course, destroy your economy.

[C0ckney]

Like a payday loan, basically (the we'll lend you money to pay off your other owed money).

Contracting your government spending when you are facing a recession will, of course, destroy your economy.

yes. you might add that the guy is then blamed for his fecklessness when he can't escape the debt cycle.

as i said the TROIKA's plan for greece worked. greece didn't leave the euros and the banking system is still standing, but the greek people paid the price. it seems they've realised what has happened, even if others haven't.

[Colon™]

...not to write off the debt

50% of the debt Greece owed to banks was written off as part of the 2nd bailout, amounting to €100 billion. The new loans Greece received were of longer maturity and lower rates than previously, never mind what it'd have had to pay the markets for renewing the loans. Again, because of these measures is currently paying less interest as a share of GDP than Italy.

Mind you, it was Greece ITSELF that asked a bailout from the EU and the IMF, in which Germany was very disinclined to participate, and it's Greece that's STILL asking for new loans. Yeah sure, the Greek would rather want that others would simply take over all its debt, no strings attached, but what kind of an incentive is that to bring its finances in order? Surely, this can't be that hard to understand.

[Colon™]

74% of the Greeks do not want to leave the euro...

[Colon™]

Like a payday loan, basically (the we'll lend you money to pay off your other owed money).

Contracting your government spending when you are facing a recession will, of course, destroy your economy.

Reforms are a standard condition for debt relief, I'd have though that you'd be aware of that. Usually the economic blow is softened with a devaluation but that's not possible in Greece due to the euro and the Greeks themselves did not want to leave the eurozone.

[C0ckney]

yes the second 'bailout', when it had become completely obvious to everyone that the debt couldn't ever be paid off, and when the general situation for the euro and banks was looking better, but i was talking about the initial plan. and i blamed greek politicians too.

[C0ckney]

Greece’s new young radicals sweep away age of austerity

From minimum wage to prescriptions, Alexis Tsipras is making good his promises to voters in startling fashion

One by one they were rolled back, blitzkrieg-style, mercilessly, ruthlessly, with rat-a-tat efficiency. First the barricades came down outside the Greek parliament. Then it was announced that privatisation schemes would be halted and pensions reinstated. And then came the news of the reintroduction of the €751 monthly minimum wage. And all before Greece’s new prime minister, the radical leftwinger Alexis Tsipras, had got his first cabinet meeting under way.

After that, ministers announced more measures: the scrapping of fees for prescriptions and hospital visits, the restoration of collective work agreements, the rehiring of workers laid off in the public sector, the granting of citizenship to migrant children born and raised in Greece. On his first day in office – barely 48 hours after storming to power – Tsipras got to work. The biting austerity his Syriza party had fought so long to annul now belonged to the past, and this was the beginning not of a new chapter but a book for the country long on the frontline of the euro crisis.

“A new era has begun, a government of national salvation has arrived,” he declared as cameras rolled and the cabinet session began. “We will continue with our plan. We don’t have the right to disappoint our voters.”

If Athens’s troika of creditors at the EU, ECB and IMF were in any doubt that Syriza meant business it was crushingly dispelled on Wednesday . With lightning speed, Europe’s first hard-left government moved to dismantle the punishing policies Athens has been forced to enact in return for emergency aid.

Measures that had pushed Greeks on to the streets – and pushed the country into its worst slump on record – were consigned to the dustbin of history, just as the leftists had promised. But the reaction was swift and sharp. Within minutes of the new energy minister, Panagiotis Lafazanis, announcing that plans to sell the public power corporation would be put on hold, Greek bank stocks tumbled. Many lost more than a third of their value, with brokers saying they had suffered their worst day ever. While yields on Greek bonds rose, the Athens stock market plunged. By closing time it had shed over 9%, hitting levels not seen since September 2012 and losing any gains it had clawed back since Mario Draghi, the European Central Bank chief, vowed to do “whatever it takes” to save the euro.

By nightfall there was another blow as Standard & Poor’s revised its Greek sovereign rating outlook, taking the first step towards a formal downgrade. The agency warned that a bank run might also be in the offing, noting that “accelerated deposit withdrawals from Greek banks had created “a credit concern”.

Perhaps prepared for the onslaught, Tsipras had also acted. On Tuesday, he met the Chinese ambassador to Athens to insist that while Syriza and its junior partner, the populist rightwing Independent Greeks party, would also be cancelling plans to privatise Piraeus port authority, the government wanted good relations with Beijing. China’s Cosco group, which already controls several docks in Piraeus, had been among four suitors bidding for the port.

On Tuesday, Greece’s anti-austerity finance minister, Yanis Varoufakis, held late-night talks with his French counterpart, again to placate and reassure. “Our priority is to conduct new negotiations with our partners with the aim of reaching a fair, viable and mutually beneficial solution,” insisted Tsipras, at 40 the country’s youngest postwar leader, “so that the country exits the vicious circle of excessive debt and recession.” As he was handed the reins of the finance ministry, by Gikas Hardouvelis, his predecessor, Varoufakis, 53, an academic who has taught economics in Athens, Britain, America and Australia, repeated that message. The new government’s aim was not to spar with its partners but to create a “new relationship of friendship and sincerity”.

There is no denying Athens’s young revolutionaries have hit the ground running – and hit it with a thunderous thud. In some ways no one represents this better than the iconoclastic Varoufakis, whose investiture should go down as a textbook case of what happens when radicals come into town.

If Hardouvelis, had had his way the handover would have been uneventful, if a little lachrymose. “I sincerely wish the new government well,” he said, eyes firmly fixed ahead. “Greece doesn’t have the luxury of waiting until June to conclude [negotiations] with our partners. There are debt repayments that have to be made.”

And then it was Varoufakis’s turn and he was off, rocking and rolling his way through Hardouvelis’s script, demolishing the philosophy of a government that had, he said, thrown the country into a self-perpetuating economic death spiral and all because of a mistake “a huge toxic mistake made in this very building”. There was no looking back and as Hardouvelis nervously looked on – at times relieved, at times alarmed – it was quite clear that there was no stepping back either. Greece sincerely had no intention of clashing with its partners, Varoufakis insisted, but the logic of austerity was such that policies conducted in its embrace could only fail.

“We will rehire the cleaners who were fired from this building,” he said, all guns blazing, as he promised to reinstate the women who have become the face of austerity’s injustice. “And then we will seek a pan-European new deal to reboot [our] economies.”

[Colon™]

Let's see how quickly they'll undo the undone once the learn the rest of Europe isn't going to pay for it.

[Sava]

^^ attitudes like this keep Europe divided and weak

[Hauldren Collider]

I think what keeps Europe weak is when they bankroll poor decision making by countries like Greece.

[Hauldren Collider]

This is going to end very badly. Basically everything they are rolling back was good public policy.

[Hauldren Collider]

Like a payday loan, basically (the we'll lend you money to pay off your other owed money).

Contracting your government spending when you are facing a recession will, of course, destroy your economy.

Not if those public sector workers aren't actually producing anything. Which is true of most of them.

"But wait!" you say. "What about the money that they spend?" OK, then just give everyone a welfare check, and release them from their pointless jobs, and they at least might possibly get productive jobs that produce value while simultaneously leeching off the private sector.

[C0ckney]

This is going to end very badly.

i know right. if they go ahead with all this lefty nonsense the economy will shrink by a quarter and they'll have 50% youth unemployment.

oh, wait a minute.

[C0ckney]

Latvia's unemployment has halved since that peak and the market rate for Latvia 10-years govt bonds is 0.99% (compared to 8.87% for Greece). Meanwhile the Greeks feel they're being opressed because the EU and the IMF have the temerity to set conditions when they're providing many dozens of billions.

i somehow missed this. i think it gives a clue to the differences in our thinking.

i say: 10% of the population had to emigrate and those who remained's wages were slashed.
you say: but now there are more jobs, with lower wages, and look at those low, low bond yields.