Greece

Thursday

Martin Vander Weyer

This Greek catastrophe isn’t Lagarde’s fault but her career is starting to look like toast

The Greek drama took a turn few of us expected last week, when the world thought compromise was imminent. What happens after Sunday’s referendum is anyone’s guess — but recrimination is already flying, much of it aimed at IMF managing director Christine Lagarde. Having inherited the Greek headache from her predecessor Dominique Strauss-Kahn after his resignation in 2011, she has always talked tough — but now stands accused of setting aside IMF rules, as well as long-established blueprints for debt relief and the views of many of the Fund’s own economists, in order to stay aligned with the European Commission and the European Central Bank in the ‘troika’ of bailout negotiators.

Wednesday

James Forsyth

Greek referendum going ahead as Tsipras again urges No vote

After much speculation that the Greek referendum was about to be cancelled, Alexis Tsipras has just appeared on Greek television to confirm that it is going ahead and to urge people to vote No. He said that those saying a No vote would mean Greece leaving the Euro were telling lies. He argued instead, that a No would strengthen his negotiating hand and allow him to achieve a ‘social deal’ which would be easier on the poor and pensioners. Everything now turns on the result of the referendum. If it is a Yes vote, the Syriza-led government will almost certainly resign and one can see how the country’s creditors could do a deal with a new government. But if it is a No, then it is not clear what will happen.

Charles Moore

Why is the FT ordering Greece to do what Germany wants?

‘The Greek people,’ the Financial Times leading article said on Monday, ‘would be well advised to listen closely to the words of Ms Merkel. The plebiscite will be a vote for the euro or the drachma, no less.’ It is interesting how menacing powerful ‘moderate’ institutions can become when popular feeling challenges them. In the eurozone theology to which the FT subscribes, its statement above cannot be true. It is not possible (see last week’s Notes) for a member state to leave the euro, any more than it is for Wales to renounce sterling. Eurozone membership, once achieved, is a condition of EU membership. So the Greeks cannot vote to leave the euro, unless they vote to leave the EU — which even the FT is not claiming is happening.

Matthew Lynn

The sooner Greece leaves the euro, the better

Ten years ago, the Greek minister Yainnos Papantoniou came to London to give a talk at the London School of Economic on the country’s first four years as a member of the euro. A skilled, pro European technocrat, Papantoniou had, more than anyone else, steered his country through dogged German resistance into the single currency. Papantoniou boasted that a history of weak growth and chaotic government had been swept aside, and that Greece was now the equal of Germany and France. What lay ahead, he argued was 'a new dynamic phase for the Greek economy, based on knowledge and modern structures'. A 'bolstering of national self-confidence' would be the natural result. It was an articulate exposition of the view of a whole generation of Mediterranean politicians, eurocrats and bankers.

Tuesday

Ed West

Greeks v Franks – why culture still matters

During the period of the crusades Greeks would refer to western Europeans by the generic term ‘Frank’, derived from the name of the leading barbarian tribe of the west. The word still lives on as a name for white people in Urdu and Hindi – Firangi – as well as Thai and Vietnamese, for whom US soldiers were called Farang (or ‘black Farang’ for African-American troops). According to Norman Stone’s history of Turkey, the word for syphilis in Turkish is likewise derived from Frank (it was also called ‘the French disease’ in 15th century Italy).

Monday

James Forsyth

The Eurozone’s new strategy: hope for a Yes vote in Greece

The question that will be on the ballot paper in Greece on Sunday is rather wordy, so European leaders have been trying to simplify it for Greek voters today. Their message has been vote Yes to the bailout deal to stay in the Euro and No for a return to the Drachma. Their logic is that however much Greeks may dislike imposed austerity, they don’t actually want to leave the Euro. It has become clear today that the Eurozone’s strategy now is not to try and put together a last minute agreement but to instead rely on a Yes vote on Sunday. This would lead to the fall of the Syriza-led government and the Eurozone’s hope is that a deal could then be done with a new, more emollient Greek government. Indeed, there seems to be little hope of a last gasp compromise by either side.

James Forsyth

Jean-Claude Juncker raises the stakes for the Greeks

Jean-Claude Juncker, the president of the European Commission, has suggested that if Greece votes No in the referendum on whether to accept the terms of a bailout, it will be voting not just to leave the Euro but the EU too. Juncker has clearly decided that the best thing to do is to put the pressure on for a Yes vote in the referendum on Sunday. A Yes vote would force the Syriza-led government to resign. At that point, a deal could—potentially—be done with the new Greek government. However, it is worth noting that any new deal would have to get through various Northern European parliaments which could be tricky.

Sunday

James Forsyth

If Greece leaves the Euro, Cameron should start the British renegotiation all over again

Tonight, it is still not clear how the Greek situation will be resolved. The European Central Bank--which is desperate to avoid being dragged into the politics of this situation--has chosen a middle way on its emergency assistance to Greek banks. It has neither ended it—which would have crashed the whole Greek banking system—nor extended it, which would have enabled the banks to stay open and eased the pressure on the Syriza-led government. Greek banks will definitely be closed tomorrow and probably until the referendum on Sunday. The next big question is what happens on Tuesday when the bailout programme ends and a payment comes due to the IMF which Athens will not be able to make.

Saturday

James Forsyth

Greece: ‘The crisis has commenced’

Alexis Tsipras’ gamble in calling a referendum on the bailout deal has failed in two respects. First, it has not prompted Greece’s creditors to offer the country a better deal. Second, they are not going to extend the bailout until the referendum—so, it will end on Tuesday. This means that without capital controls, the Greek banks will not be able to open on Monday morning. As the Irish Finance Minister put it, ‘The crisis has commenced’. We are now waiting for two things. First, will the Greek parliament and president approve the referendum. Second, will the European Central Bank continue to prop up the Greek banks. But, at the moment, it looks as if Greece is heading out of the Eurozone.

Friday

James Forsyth

Greece to hold referendum on bailout deal

The Greek Prime Minister Alexis Tsipras has just announced that there will be a referendum on the proposed bailout deal next Sunday, July 5th. He will ask for the current bailout to be continued until then to allow the Greek people to have their say. The signs from Athens are that Tsipras will campaign for a No vote unless the creditors offer Greece a radically better deal at tomorrow’s meeting. This move from Tsipras will infuriate Greece’s creditors.  It will also, almost certainly lead to the introduction of capital controls for Greek banks until the referendum. If the creditors don’t blink tomorrow and improve the terms they are offering Athens, then it is hard to see how the current deal can win a referendum in Greece.

Thursday

Peter Jones

Hesiod on Grexit anxiety

Why do Greeks want to keep the euro, or remain in the European Union? The combative, creative, competitive, mercantile classical Greeks throve on independence. The farmer-poet Hesiod (c. 700 BC) makes the point about competition by calling it Eris, ‘strife’, which he characterises as painful but also helpful. On the one hand, he said, it creates conflict and discord; on the other, ‘It gets the shiftless working. For when someone whose work does not come up to scratch sees someone else, a rich man, busy himself ploughing and planting and managing his household well, then there is competition between neighbours in the race to riches. This Eris is good for men: potter battles it out with potter, carpenter with carpenter, beggar with beggar and poet with poet.

The Spectator

Portrait of the week | 25 June 2015

Home Tens of thousands took part in a demonstration in London against austerity, and thousands more in other cities. Russell Brand was heckled for being too right-wing: ‘Fuck off back to Miliband,’ protestors in Parliament Square cried. David Cameron, the Prime Minister, explaining his thinking on further benefit cuts: ‘There is what I would call a merry-go-round: people working on the minimum wage having that money taxed by the government and then the government giving them that money back — and more — in welfare.’ The government sold more shares in the Lloyds Banking Group, bringing its ownership to less than 17 per cent.

Charles Moore

The Spectator’s notes | 25 June 2015

People write about ‘Grexit’ and ‘Brexit’ as if they were the same, but they need not be. Grexit is about leaving the euro. Brexit is about leaving the EU. It seems, however, that the Greeks fear that leaving the euro would mean leaving the EU, and so feel paralysed. It simply is not clear what the true situation is. Although Britain has a specific opt-out (as does Denmark), for the other member states, euro-membership is, after a preparatory period is completed, an obligation. Does this mean that, once in the euro, an EU member state cannot leave it? If so, then William Hague’s famous phrase likening it to ‘being in a burning building with no exits’ is exact.

Christopher Caldwell

If Merkel shrugs…

[audioplayer src="http://rss.acast.com/viewfrom22/angelamerkel-sburden/media.mp3" title="Fredrik Erixon and James Forsyth discuss the challenges facing Angela Merkel" startat=36] Listen [/audioplayer]German chancellor Angela Merkel may still be the most formidable politician in Europe, but this week she lost a bit of her reputation as the scourge of Mediterranean debtor nations. Greece’s firebrand leftist premier, Alexis Tsipras, actually gets on well with Merkel, however much his countrymen enjoy burning her in effigy and adorning her portraits with Hitler moustaches. In a recent profile of their relationship in Der Spiegel, Tsipras gushed, ‘She has this East German way of telling you honestly and straightforwardly what she thinks.

Martin Vander Weyer

Contagion of a different kind as Greece wriggles off the hook

The clear winner in the Greek crisis is the author of The Little Book of Negotiating Clichés, whose royalties must have been pouring in as the clock ticked towards midnight while European leaders took positive steps back from the brink and found themselves speaking the same language, perhaps because they were reading from the same page. But assuming this predictable dance results in terms that Prime Minister Tsipras can persuade his comrades to accept before the IMF’s default deadline and the moment when the Greek banking system can no longer seek life-support from the European Central Bank — which is all still quite a big assumption — who will be the loser?

Wednesday

Fredrik Erixon

Greece’s service economy is no match for Germany’s mercantile one

It sounds a bit odd these days but economics was actually invented by the Greeks. Back then, in ancient Greece, the ethos of economics was to keep the house in order and generally manage finances in a way that would make Wolfgang Schäuble blush with embarrassment for extravagant habits. Now economics is about to get a new meaning for Greeks. Perhaps not a science, but Greekonomics is now the art of killing an economy softly. The Greek tragedy is not that it teeters on the brink of default. Greece is going to get its deal – and its euro membership will live to die another day. The deal that is fleshed out in Brussels now will just help to push the country to the next time it needs financial support to pay its creditors.

Tuesday

David Patrikarakos

The one thing that might ensure a Greek deal: fear

On a narrow, sloping street in downtown Athens sits a graffiti-strewn wall that has captured the spirit of a nation. Amidst the spray-painted slogans and flaking posters, a black-and-white stencilled image of Greek Prime Minister Alexis Tsipras looks down benignly (beneath a perfectly-observed monobrow) at passers-by. His arms outstretched, dressed in flowing robes and with a halo circling his head, he is Christ come to redeem Greece. Such is the bitter humour that now pervades the country’s capital city as the prospect of financial implosion nears. Tsipras came to power promising to get rid of austerity and take the fight to Greece’s European partners. Reality, alas, proved less accommodating. The partners didn’t budge. Syriza, the party Tsipras leads, has had to.

Monday

James Forsyth

Greece: The devil will be in the detail

The Greek economy minister Giorgos Stathakis has told Robert Peston in an interview that the deadlock between Athens and its creditors has been broken, that $7.2 billion of funds should soon be released enabling the IMF to be paid at the end of the month. But this judgement seems distinctly premature. First of all, the technical negotiations have yet to take place — and it is all too easy to see how a deal could fall apart then. While the IMF tends to take a tougher line than the European Commission and so might not sign off on this deal. It is also worth remembering that there have been times when the Greek view of what has been agreed has differed distinctly from that of the rest of the Eurozone.

Douglas Murray

A trip to Greece might make Charlotte Church fear national debt

It is amazing what some people are willing to listen to on a Saturday.  I have just watched Charlotte Church’s speech to the small fringe of ‘anti-austerity’ activists in Westminster at the weekend. And my reaction is very much ‘Coo!’  Of course I knew how humourless this portion of the left can be, with their beliefs that Ukip is a ‘fascist’ party and that the current government is secretly selling off all schools and hospitals.  But even I didn’t think that they would wish to spend their weekends hearing lectures on David Cameron’s ‘neo-liberal vernacular’ from Charlotte Church.  Yes, she actually used that phrase in her speech.