Opinion – Greece Calls Referendum on Bailout Terms – WSJ

the logo of syriza

the logo of syriza (Photo credit: Wikipedia)

English: Alexis Tsipras in a press conference ...

English: Alexis Tsipras in a press conference in Komotini. Ελληνικά: Συνέντευξη Τύπου του Αλέξη Τσίπρα στο ξενοδοχείο Ξενία στα πλαίσια της επίσκεψης του στην Κομοτηνή 13.11.2008 (Photo credit: Wikipedia)

This is an important and detailed article from the WSJ. It’s a recommended read!

via Greece Calls Referendum on Bailout Terms – WSJ.

So finally the creditors said, ‘Take it or leave it!’. For domestic political reasons in Germany and in respect to other bailout countries, austerity is still part of the deal. This is despite widespread criticism from mainstream economists and both left and right wing media around the world. This offer is essentially political, rather than economic. It’s a signal to others to obey the rules.

Meanwhile, the response from Mr. Tsipras, the Prime Minister of Greece and the leader of the hard-left, anti-austerity, Syriza party, is to call a referendum in Greece, July 5. This was not a surprise because otherwise the Syriza party would have a questionable mandate to sign such a deal.

Between now and July 5, watch out for the following:

  • Forced introduction capital controls in Greece
  • Closure of  banks until referendum
  • Level of continued support from the ECB for Greece’s banks
  • Campaigning position of government ministers
  • Honesty of political classes in Greece about the increased hardship of a Grexit, and
  • Announcement of a general election

It will be hard for Greece’s pensioners to accept further cuts to their pensions. But they must be convinced that the alternative is no pension, far deeper cuts or payment in IOUs.

It’s a difficult decision for the citizens of Greece but it’s democracy at work.

Thoughts?

3 responses

  1. Continued….
    Dr Alf who has brought us this news refers to opinion from newspapers about the possibility of GREXIT,the risks of contagion and the beastliness of Greece’s creditors.
    Just how sanguine would they be if their advertisers decided not to pay them on the grounds that THEIR banks were being beastly to them?
    We will never know for certain but what we do know is that their lurid headlines sell newspapers and keep television pundits in a job.

  2. There has to be a signal to others to obey the rules and Greece cannot be given special bailout treatment because other countries which have endured just as much and are at least trying would demand the same.

    Whilst there is nobody on earth that can transmute Greeks into Germans or Britons, the Greek people are the ones calling for others to put their hands in their pockets whilst insisting that they are 100% in the right. It does not work that way, not for them nor for the Scots who demand independence, tax raising powers and increases to the Barnett Formula.

    Greeks, whether they like it or not, have to understand that the free ride is over after this next bailout which will come soon enough.

    People who do not contribute to the costs of things really have no right to a say in anything unless their position has been caused by a cataclysmic or unforeseen event that they had nothing to do with.
    That said the Greek people will be “consulted” and the rest of us will be presented with the bill without getting so much as an acknowledgement such is the contempt with which we are held by our political masters who see us as little more than cannon fodder or sheep to be corralled and fleeced.

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