Daily Mail: Greek election leaves Eurozone in crisis: Far Left sweeps to victory with vow to end austerity years as EU braces for 'catastrophe'
* Syriza soars ahead of ruling New Democracy with predicted 149 seats - just short of 151 it needs to rule outright
* PM Antonis Samaras conceded defeat after warning of 'catastrophe', adding: 'The Greek people have spoken'
* Syriza's leader, aged just 40, promised to 'restore the country's lost dignity' and 'clash with old establishments'
* Euro hit 11-year low hours after the result, which also put Nazi-influenced far right party Golden Dawn in third place
WNU Editor: Cannot say that I am surprised. Syriza leader Alexis Tsipras election message was very clear .... to a country that has been devastated by economic mismanagement he vowed that Greece would not respect its agreements on paying down its debts while promising an end to austerity and .... implying a return to better times. What is my prediction .... he is going to fail. Greece is broke .... and half the country is unemployed or under-employed. Credit markets are all but dried up .... and what is being given is done with strings attached. The entrepreneurial class has all but been destroyed by high taxes, regulation, and corruption .... and I do not expect better times for this group with a former Communist now dictating policy. But Greece's actions will have repercussions .... failure to respect its agreements will result in Greece being kicked out of the EU and barred from credit markets. The impact on the EU/IMF/World Bank/and international lenders will be profound .... they are facing a $300 billion hit .... and this in turn will impact those countries and institutions that lent the money in the first place. Expect these institutions to start running around for a bailout and/or emergency funds soon. As for Greece itself .... they are going to be facing some very hard times ahead. Countries that get frozen out of international credit markets end up suffering greatly .... and for a very long period of time. And for Greece .... that long time is going to be a decade or two.
More News On Today's Elections In Greece
Tsipras declares end to 'vicious cycle of austerity' after Syriza wins Greek election – live updates -- The Guardian
Tsipras pledges end to ‘vicious cycle of austerity’ at victory speech in Greece -- Euronews
Greece election: Anti-austerity Syriza leader Tsipras vows to end 'pain' -- BBC
Tsipras moves to form anti-austerity Greek government after crushing victory -- Reuters
Anti-Austerity Party Wins Greek Election -- VOA
Greece’s anti-austerity Syriza party officially wins parliamentary elections -- RT
Greek radical left wins election, threatening market turmoil -- Al Jazeera
Samaras: "my conscience is clear" says defeated Greek PM -- Euronews
Greece elections: Syriza and EU on collision course after election win for left-wing party -- The Independent
Euro Slides to 11-Year Low After Greece’s Anti-Austerity Party Wins -- Sputnik
How Europe reacted to Syriza's win -- The Telegraph
Euro, stocks slip as Greece set to reject austerity -- Reuters
Syriza Win in Greek Vote Sets Up New Europe Clash -- WSJ
Syriza victory: Turning point for EU? -- Chris Morris, BBC
6 comments:
Sounds like the Greeks
want to be Europe's
Venezuela. It will
be interesting to see
what the Germans do
now.
ofs
JOIN BRICS ,
I agree with WNU Editor that this is a profound development. It is remarkable how calm the markets and political comments are regarding Syriza's victory, so far. I think the European markets, media, and political elites all share the following assumptions:
1. Syriza is bluffing. Almost all European politicians talk tough, but in practice are pretty flexible (less politely, they are flaccid, squishy, and weak). When the actual negotiations happen, Syriza will deal.
2. The EU, ECB, IMF, and Germans are bluffing. This is the mirror image of #1. When Juncker, Merkel, et. al negotiate with the Greeks, the Europeans will deal. Syriza likely thinks that #2 is true.
3. The European establishment wants Greece in the EU so much that they will let Greece off the financial hook. In this view, the importance of the EU project (i.e. once in the EU, always in. Think Hotel California) trumps whatever it costs to keep Greece in. The EU establishment wants to avoid setting a precedent that a country can leave. In this view, the real worry of the EU Establishment is not Greece but Spain, Portugal, and Italy. Syriza likely believes #3.
4. The consequences of Greek default and exit from the Euro or the EU altogether are so horrible everyone will avoid Grexit.
I think that all of the foregoing assumptions are unwarranted, for the following reasons:
A. It is not clear (to me at least) that the Germans will ask their taxpayers to work hard so that the Greeks don't have to. Even Chancellor Merkel will have a tough time selling that one to her voters.
B. Greece is already fiscally unsustainable. It is not only about debt restructuring; it is about Greece's current fiscal insolvency. Greece sells far less than they buy and they need loans just to preserve their current purchases. To me, Greece is like a person who spends twice his annual income. To carry on, Greece needs continual fresh loans.
C. If the EU establishment caves to Greece, then no one (Spain, Portugal, Italy) will agree to austerity in the future.
D. Syriza may be different than the typical flaccid European politicians. They really mean to ask (1) for debt forgiveness and (2) fresh loans to continue current consumption, while (3) abandoning reform. Of course this does not make economic sense, but Syriza are Marxists, so why is anyone surprised?
E. The austerity imposed on Greece has been harsh, and Greece's economy has been limping along, almost in a depression, for years with no end in sight. Whether or not they stay in the Euro or EU, Greeks face years of poverty. If they leave the Euro or the EU, Greece will reissue drachmas. That currency will plunge, setting off inflation that will reduce every Greek's standard of living. Arguably, the pain will be sharper, but faster.
F. Syriza will blame all the pain the Greeks endure in future on the EU Establishment. This will be useful to get re-elected in a few years. Syriza's Marxist economic policies will not improve Greek's economy, but Syriza is more concerned with power than economic success.
In light of A-F, I can easily imagine Greece exiting the Euro, the EU, or both. Once the markets, the commentators, and the EU's political class recognize this, I expect the European markets, and the Euro, to fall.
Thank you for your remarks Publius. Could not have said it any better.
Publius, for the very reasons you have listed there is no direction the Eu can now go that will save itself.
After the elections and the promises he made to get elected (by a big margin) Syriza must either get debt forgiveness or take Greece out of the EU, but he must do it quickly for the tactic of blaming the EU for Greek economic collapse to be effective. There are three other possibilities to consider, coup de etat, assassination, or Syriza being bought off. These are possible but in my opinion unlikely.
If Greece goes then the rest of the pigs will too, but most assuredly Britain.
If there is debt forgiveness then good bye Merkel and Germany.
As an after thought I now believe the timing of the recent EU Quanitative Easing was directly related to this election.
I agree James. There are many reasons on why the recent EU Quantitative announcement was made .... but Greece was certainly one of them.
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