Saturday, June 27, 2015

Greece's Fate

My head is spinning. I mean as in The Exorcist big time head spinning.

Anxiety over what will happen to their country is front and center on every Greek’s mind.  It’s been that way for quite some time, though only reluctantly verbalized.  A sense of fait accompli, nationalism, denial, or some other coping device may have contributed to hesitancy at expressing such thoughts to outsiders, but that’s no longer the case; many now openly share their doubts, concerns, and fears. 

Just this week The New York Times published a photo essay with quotes from residents of Hydra, an island close by Athens.  I found it sad, but accurate.  Few see a happy ending anytime soon, only a choice between bad and worse. 

As I said, sad.

I saw a quote in another NY Times article a few days back attributed to the head of a European think tank commenting on the EU’s attitude toward Greece:  “‘If it were not for the geopolitical context,’ Mr. Lafond said, ‘they would have let them leave long ago.’”

Sadly, I think he’s right.  And in that rests what is emerging as the most likely scenario for Greece.

It seems that every political pundit, economist, journalist, TV commentator, and blogger has hit the keyboards with prognostications and predictions on where Greece is headed and its implications to the world.  I bet folks are playing the odds in Vegas on the outcome—they certainly are on the Athens stock market in a manner generating such wild swings with every pronouncement on the subject by a government minister that were it a US market, the SEC would be up to its eyeballs in investigations.

But that’s a subject for another time.

So, what do I see as the likely outcome?

Well, for a while I saw a contender for the title of “most likely scenario” being Greece’s Prime Minister announcing he’d fought the good fight against the western hordes, but in order to save his country he reluctantly had no choice but to accept the “odious” terms and give in to the demanded reforms. It would involve him charging forward on a white stallion away from his far left party roots to emerge as the leader of a new centrist government. 

But that fairy tale seems over. It would require the Prime Minister to ostracize the extremists in his party and he’s shown no willingness to do so. 

Which brings me to where I see things headed….

Assuming this grand kabuki theater of under-a-deadline negotiations continues to drag on…and that seems likely with further talks adjourned until today…I think we’ll see the West throwing up its hands and adopting an approach that keeps a lid on things, doing only what’s minimally necessary to protect its geopolitical interests.

In other words, keep the patient on life support.  Give Greece what it needs not to default on its interest payments, allow the Greek government to claim victory for domestic purposes, and let the new government’s policies run their course on the people who elected it.  If the West truly believes that its proposals are better for Greece in the long run than the Greek government’s approach, that’s the West’s smartest play, for it allows Greece to fail to emerge from crisis by reason of its own choices, serving as a stark warning to any EU member state that might otherwise be tempted to consider adopting Greece’s policies and negotiating tactics.

It’s not a pleasant outcome, and one I pray doesn’t happen, but it’s how I’m seeing things today.  Or at least this morning, in sunny beautiful Greece—where tourists are, and will undoubtedly remain, blissfully unaware of all of this.

By the way, to end on a lighter note, does the world know that obviously separated-at-birth siblings, IMF Chair Christine Lagarde and Greece Finance Minister Yanis Varoufakis,

have a sister?



  1. It's sad, no matter what happens. It seems, historically, that drastic changes (in human society) only happen through great upheaval, which means great suffering for a great many people. And Greece (and much of the rest of the world) seem to have boxed themselves into an alley with only one way out...

    But it's always good to hear from you, Jeff, sweet tea or bitter. :-)

  2. The saddest thing to me, EvKa, is how many hard working, intelligent young people now see no future here. Politics is one thing, robbing children of their dreams quite another.

    Always good to hear from you, too, Lemonaid man.

  3. I don't really know enough about it to comment, but I have a question. Does EITHER side have a plan to revive the Greek economy? Or does the whole debate revolve around: How do we get our money back? versus: How do we keep all the special perks of our supporters?

    I suppose I'm naive enough to think that a path out of the current doldrums is worth the perks and the money. Doses of austerity usual make economies worse not better. Unsustainable social benefits are just that. Why is this so hard?

    1. To make things even curiouser, this morning Greece's Prime Minister announced that rather than accepting the lenders' offer of extending the bailout program until November--rather than facing an imminent default--he would be calling for a nationwide referendum on Sunday July 5 at which time the Greek people would vote yes or no on accepting the lenders' "blackmail ultimatum." Not sure if he thinks that will lead the other EU members to blink and give in to what he wants or just give him political cover for what he sees as an inevitable result. Or something else...

      Both sides believe their plans will revive the Greek economy. But some also believe in Santa Claus.

  4. Sister, really? Surely that is a trans brother I'm seeing! More time in Mykonos needed to sharpen your transdar, Jeff....Dr. shrew prescribes another Month, just to see how this shakes out. Indeed, Greeks are facing an impossible choice while there are still sociopaths out there and in here planning how to win big on Greece's losses.

  5. On the day after the Supreme Court's decision on Gay Marriage let's just call herm a Sisbro or Brosis.

    As for the profiteers, a big yes on that. It's a business school exercise on how to profit out of disasters come to life.

  6. Your point about the good, hard-working people and the future is a good one. We know so many who work hard, pay taxes and just want the 'crisis' to be over so life can get back on track. I fear, this 'crisis' will soon be over but I am not sure the direction the track will lead is what these wonderful people have in mind.

    1. Today in Greece, I'd venture to say everyone not in line trying to get money out of ATMs is glued to the television. I have never seen such uniformly long and anxious faces. I take that back, as I lived through 9/11 in NYC. This latest move by the Prime Minister--a call for the first referendum since 1974--has shocked the nation. It will be a tumultuous week if Parliament votes for the referendum to proceed.

  7. Tsipras has a fought a valiant fight, but he is quite right to put it to a referendum. The EU will come out of this with a bloody nose, and maybe a brain injury from which it won't recover.

    The Germans seem to have forgotten history too. It was a direct result of US Banks pulling loans from Germany that led to the rise of National Socialism, a chapter in history that I certainly wouldn't want to see repeated.

    For the EU to issue an ultimatum to a sovereign nation in this fashion is nothing short of dictatorial, and has played right into the hands of the Like of Marine Le Pen and Nigel Farage. They will use this to say to the electorate, "This is what happens when you disobey Brussels" will be there cry, and it's not just Greece, Spain, Italy and Portugal are all still in a tenuous position and this message doesn't bode well for the longevity of the EU.

    My question is this the type of democracy I want? Judging by what I am seeing right, it doesn't even seem like democracy!

  8. Iain, you make serious points voiced here in Greece by some. What troubles me at 3 AM Athens time while I watch the conclusion of the Parliamentary vote on whether or not to go forward with the referendum next Sunday is this: As I mentioned, it will be the first referendum in Greece since 1974 when the nation voted to become a republic. Today the nation is polarized and anxious, and in the coming week should the referendum go forward, rhetoric and tensions will be white hot. And I'm not sure they will cool once the results are in. All parties are in uncharted waters, but Greece I fear faces the gravest risks.

    The vote is in. The Referendum will go forward on July 5th. May God bless the Greek people.

  9. The situation in Greece saddens and scares me in equal measure. It's a crisis that just doesn't seem to have a non-chaotic answer, and no matter what happens, it seems like "regular people" will be hurt.

    1. Honestly, Susan, I think much of the nation is in shock. I'm seeing the same sort of facial expressions as I did in NYC on 9/11. How tense this week will be in large part depends on how the government handles the vote on the referendum. If it pushes hard to characterize an Oxi (no) vote as the only patriotic way to be, I seriously worry about the polarizing repercussions. Apparently there will be no more ECB money flowing into Greek banks, so if a run on the banks starts...

      Where are the Ronins when we need them.

    2. Jeff, It's the polarizing repercussions that I feared as soon as I heard of the referendum tactic. This could be awful, just awful. I hope not, but I am very afraid.

    3. Yes, some misguided souls could channel the accumulated and rapidly increasing anger into very bad places.