The Telegraph: Greek deal in sight as Germany bows to huge global pressure for debt relief
Angela Merkel faces a defining moment in her political career as chorus of voices push for Greek debt relief.
Germany is at last bowing to pressure as a chorus of countries and key institutions demand debt relief for Greece, a shift that could break the five-month stalemate and avert a potentially disastrous rupture of monetary union at this Sunday’s last-ditch summit.
In a highly significant move, the European Council has called on both sides to make major concessions, insisting that the creditor powers must do their part as the radical Syriza government puts forward a new raft of proposals on economic reforms before a deadline expires tonight.
WNU Editor: What a difference a few days make. The Greek government submits a plan that 61% of the Greek population voted against on Sunday, but with the proviso that they want to borrow more money. The Germans appear to be backing down after being put under heavy pressure from their EU partners .... accepting the fact that maybe some debt write-offs need to happen. As to what is my take .... the damage has already been done. It will be years before the Greek government can borrow money from international markets. Companies that export goods to Greece will not give credit .... or will under strict terms. Many of the Greek banks have been severely damaged .... expect major bank failures around the corner .... With cash fast running out, Greek bank failures loom (Financial Times). Greece will now owe even more money .... and I am doubtful that they will institute the reforms that they need .... as a result .... it would not surprise me if by next year they are looking for another bailout.
More News On The Greek Debt Crisis
The Latest: Greece seeks 53.5B euros in new bailout package -- AP
Greece sends reform plan to EU promising new tax hikes -- Reuters
Greece proposes tax hikes, spending cuts, pension reforms -- AP
Greek Plan Accepts Austerity to Get Debt Relief -- NYT
Greece submits last-ditch request for a bailout -- Washington Post
Greece debt crisis: Eurozone receives economic reform plan -- BBC
Greece submits new reform plan as clock ticks down -- CNN
Greece submits debt proposals to creditors - Eurogroup -- RT
Greece eyes austerity in fresh EU bailout bid -- Al Jazeera
Greece's Tsipras to sell last-ditch deal to reluctant party -- AP
Greek parliament to vote on new cuts-for-cash plan to break deadlock -- The Guardian
Eurozone under pressure over Greek debt drama -- Chris Morris, BBC
Poorer than Greece: the EU countries that reject a new Athens bailout -- The Guardian
8 comments:
A looong way from being over. Now we'll have a deal that for political reasons Tsipras can't and won't live up to, but he did get the one thing he wanted most, another 8-12 months in power and to him anything is possible. Merkel, for the same reason got her 8-12 months also, but it is a reprieve with no future, politically or economically. This agreement will now assure the rise of the conservative anti-Euro political movement to center stage and power. Germany and the EU are now publicly held hostage to debtor nations and a political fantasy. Portugal, Spain, and Italy I am sure have absorbed the appropriate lessons from this and will act accordingly. For those who blame bankers for this they should remember that the political environment must allow them to exist and operate as they have been for the last 40yrs.
With the recent events in Europe, the fracture of the Chinese economy, and the withdrawal into political and economic self absorption of the US, the economic, political and military center of gravity (to use a smarty pants term) is moving firmly toward Russia. Whether or not it gets there and how it is used by the Russians is a story for the future to tell.
James,
You are correct that the economic, political, and military center of gravity is moving toward Russia. Where I might disagree with you is I think it already has. In fact, with the Chinese economic situation this may eliminate the only power that could conceivable threaten the Russians assuming they actually wanted to. In fact, Russia is likely on the cusp of becoming the greatest power in both relative and absolute terms the world has ever seen. There seems little that could conceivably happen to alter this trajectory.
While I agree with he suggestion that what Russia does with this power is story for the future (probably not the far future), to me the trends do not look promising but people do "evolve" in terms of beliefs and attitudes over time. Essentially people and nations are not the same today that they were 5, 10, 15, 20 years ago or whatever. As such, how Russia will behave with this power over the mid to long term may not be able to be known right now.
What does seem clear is Russia is the most powerful nation the in the world today or at the very least are headed that way and are likely on the cusp of becoming the most powerful nation the world has ever seen in both relative and absolute terms with little to nothing on the visible horizon that can alter this and they view the United States as enemy #1. To say this is not a good situation for us is arguably one of the biggest understatements of all time.
How do we address this? A time honored tradition when one nation/state is faced with hostility from a more powerful nation state is to "sue for peace." This would seem our best option. While this does NOT mean we should capitulate to them on ANYTHING and EVERYTHING they might want us to do, it will mean an acknowledgment of the current geo political power structure and acting accordingly.
B. Poster,
Though I agree with many of your points, I am not quite prepared to go as far you do as to Russia's relative strength in the world and on a historical basis. Now in a given situation of place and circumstance, yes I would say you are absolutely right. Here are my questions when it comes to Russia, first just how strong and durable is their political system, i.e. is it a one man show (Putin) that would decline or collapse with his complete absence or is it a case that it doesn't matter who's #1? Can the system take a sever shock administered from the exterior (limited nuke exchange) or interior (country wide revolt) and still operate? How does Russia's political system really work? Where do low level candidates come from and how do they enter government? These are many questions that in my opinion have not only been not answered, but not even properly addressed. Who is Medveded? Who does he represent? Is the rule of law really alive in Russia for the every day person or is it all a mirage? Countries that have had long historical success by and large have had a strong rule of law and a deep strong political make up, A good example is Great Britain, though a somewhat spent force today has had a long successful run and shouldn't be counted out in the future. So basically I can say I really don't know and await developments.
James,
Thank you for the reply to my post. I agree that we do not "know" the answers to the very interesting questions you pose, however, as WNU often points out correctly I believe we can observe trends. I will attempt to share my thoughts on the questions you pose.
"just how strong and durable is their political system?" I would say very strong. As shrewd as Mr. Putin is, it would seem unlikely to me that he has not thought of a "secession plan." Given America's current economic and political situation, Russia's system is probably stronger and more durable than that of the US.
"Can the system take a severe shock...?" I think it can easily absorb any military attack that the could be thrown at it. As to a country wide revolt, it seems inconceivable to me that Mr. Putin's agents would not crush any such revolt in the cradle before it even got started.
"Where do low level candidates come from and how do they enter government?" It seems unlikely that anyone would be able to enter the Russian government without being vetted by the top officials such as Mr. Putin and his close associates.
"How does Russia's political system really work?" Mr. Putin is old KGB, has expressed nostalgia for the Soviet Union, and I'm told has praised Josef Stalin. As such, the system does not seem terribly different than old Soviet days. Perhaps they have more elections but with Mr. Putin's control of the media and the government it seems inconceivable that anyone could arise to challenge him without his authorization or those closes to him.
"Who is Medvedev and who does he represent?" It seems his views closely parallel those of Putin. He may be part of the "secession plan" that I think is likely in place.
As to how long lasting the Russian situation is will depend upon at least one major factor. As I understand it, the native Russian population is not currently reproducing at replacement rate. While Russia appears on the cusp of becoming the greatest power the world has ever known, if they are not there already, in both relative and absolute terms and this situation is accurate regarding their reproductive rates, they may not remain in this situation for an extended period.
With that said, if Russia is a "dying animal", dying animals can be very dangerous. In this case, the "animal" happens to be the strongest, the fastest, the most well connected, and the most cunning animal in the "forest." This would be all the more reason to, at a minimum, get out of their way.
Russia has three major problems right now. Sanctions, low oil prices, and apparently failing to reproduce at replacement rate. As for sanctions and low oil prices, these are temporary and the reproduction rate is easy enough to solve. Given their prior history, I'd expect them to solve this problem. I'm pretty sure Russian leaders wake up every morning thanking whatever god or gods they believe in that the problems Russia faces are no where near as severe as those faced by America.
Finally with regards to sanctions. if I were in a leadership position in America, I would act in both word and deed to end the sanctions regime against Russia. While I would not expect the EU to go along with this, it should lessen the effects of sanctions and hopefully it would quell some of the animosity felt towards us by them.
I will attempt to address your "rule of law" question in another post.
I'm not quite certain of what you mean by "rule of law." If we mean freedom to criticize the government, its officials up to and including POTUS, its foreign policy or pretty much anything else about it we wish with impunity, then "rule of law" in America has probably never been better than it is today. This is especially so if one wants to criticize anything "Republican." As for Russia, some reports indicate that criticism of Mr. Putin or his government can be a very dangerous proposition with no safe place on earth to do so.
Now if we mean by "rule of law" that the average person can count on justice in their daily lives, then the "rule of law" in the US, to put it charitably, is weak. For example, judges can and in many cases do interpret laws to suit their own political views, people can be jailed for petty drug offenses. Additionally people have had their property confiscated and ransacked for what would seem, on the surface, to be miscarriages of justice.
While I cannot say for certain about Russia, I suspect Russia currently performs much better in this area. In other words, if one works hard, takes care of their family, doesn't hurt someone, and does not criticize the government "rule of law" is probably much better in Russia than in America. The operative word here is "probably" as I do not know.
What I think can be said with absolute certainty is America did not become a great nation under the ridiculous regulatory environment it currently operates under with so many ridiculous rules and regulations. If it is to become great again, this will need to be addressed sooner rather than later.
In summary, if you mean by "rule of law" the right to criticize leadership, vote to change things, petition the government, insult the government and its top officials, call for their removal with arguably very enraging language, then the "rule of law" in America is thriving and may never have been better!! This is especially so if one wishes to attack all things "Republican." In Russia, however, it seems such things could end in death. Now if we mean a sane regulatory environment Russia probably performs much better.
You mention Great Britain. I think the same generalities regarding freedom of political dissent being able to be carried out with impunity with little risk combined with the type of ridiculous regulatory environment that we have in the United States. I also would not count them out either. For that matter, I would not count America out either.
Perhaps the freedom of political dissent is our ace in the hole so to speak. With that said, this is being eroded some and would likely be further eroded if certain people get their way with unfettered and uncontrolled immigration. Also, I would not rule out the possibility of overreach by America's enemies. For example, why don't we have deal with Iran signed yet? With the Americans despirately wanting a deal, ANY deal, with Iranians having the Russians and to a lesser degree the Chinese with them, and with the EU nations generally hostile to America's interests it should be easy for the Iranians to get anything and everything they want. It seems to me someone may have overreached to a degree that made even the Europeans or the American negotiators uncomfortable. This is not to say the deal will not happen but its clearly taken longer than it seems it should have. Given the tendency of these people to overreach in the past, I think it reasonable that they may do so in the future. If we are smart, we can take advantage of this situation. With enough prayer and some intelligent decision making there is hope for America yet!!
B. Poster,
I am still not prepared to agree. The questions I posed still remain unresolved to me. I firmly believe that no one (not even the Russians themselves) really know the answers to the relative strength of their political systems and that only coming events may give us the answers. Yes, I know Putin is ex-KGB, but I maintain (from observation mostly) that he is not your standard ex-communist security apparatchik Stalinist, this guy is a different breed of cat, Russian through and through and somewhat of the mystical bent type. The "rule of law" I refer to is the more mundane property rights type enjoyed by the British and US for the last 220+yrs. I'm not sure about your "dying animal" allusion, I have maintained for the last two yrs here that the Russia of today bears no resemblance to the Russia of even 25yrs ago, though the western politicians and media seem hell bent on treating them as such. That's all for the moment, I haven't much time (and my thoughts show it). We agree on many points Poster, but not necessarily all.
James,
Thank you for the replies to my posts and the dialogue. I know what you mean about not having much time. I agree we do not really "know" the relative strength of the Russian political system. Since these systems change over time, I'm not even sure we "know" the relative strength of ours.
Thank you for clarifying what you meant about rule of law. These property rights have had a great deal to do with enabling America and Great Britain to build some of the most successful economies the world has ever known. These property rights have significantly eroded in the last few years at an accelerating rate. If you were to try and build an "America" under the current system of property rights that exist in America today, I'm not sure it could be done.
As for these types of rights in Russia, I'd suspect they are much better in Russia today than they are in America today but must admit I don't know. Time permitting I will conduct some research on this.
As for Russia not being the same country it was 25 years ago, this is no doubt correct. America is not the same country it was 25 years ago. People are constantly changing. Since nations are made up of people, they change over time as well. I'd expect Russia and Russians to be on different in this regard.
On the geopolitical manifestations of the changes over the last 25 years, Russia is far stronger relatively speaking than it was 25 years ago, Russia's allies are far stronger than they were 25 years ago, relatively speaking America is far weaker than it was 25 years ago, America's allies including the "West", the Gulf Arab states (if we count the Arab states as allies), Japan, Australia, Canada, etc. are all weaker today than they were 25 years, with the possible exception of Israel all of America's allies are weaker today than they were 25 years ago, America has fewer allies today than it did 25 years ago, and Russia has more allies today than it did 25 years ago. Form this alone, I think it clear we need a new strategy. Additionally Russia seems to be, at least in Russian government circles, led by extreme paranoia. A sound strategy will need to take this into account as well.
Finally, as far as our allies mentioned above countries like Australia and Canada seem to be taking positive steps to address their situations and may in fact be stronger now than they were a few years ago. While some of allies mentioned above may be stronger now, the general trend seems to be the "West" is much weaker while adversaries and potential adversaries are stronger.
Sorry about the multiple posts here. Back to the original topic. "Germany backs down. Greece blinks..."
Prediction: Before this is over. Greece will get EVERYTHING they state want from Germany and the EU, they will get demands met that they never made in public, and will get some goodies thrown in that they thought about but never stated in public or private that they wanted!!
The reason: To allow Greece to exit the Eurozone would likely mean an exit of the EU. Other nations might follow and the EU project would be doomed. Germany cannot allow this. They or at least German government has to much self image invested in the EU to allow such a move. The problem is they fail to recognize the EU is a doomed project anyway. Often times when people when people make bad decisions they get a great deal invested in them and it becomes difficult for them change course.
Time will tell if any of these predictions are accurate.
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