DPC Provision store. Caracas, Venezuela 1905
Once again, a look at Greece and the Troika, because it amuses me, it angers me, and also because it warms my cockles, in an entirely metaphorical sort of way. The Troika members love to make it appear (and everyone swallows it whole) as if in their ‘negotiations’ with Greece all sorts of things are cast in stone and have no flexibility at all. Humbug.
First, another great piece by Rob Parenteau (via Yves Smith), who lays it out in terms so simple they can’t but hit the issue square on the nose. For Europe and the Troika, there’s Greece, and then there’s the rest. No money for the Greeks lining up at soupkitchens (not even for the soupkitchens themselves), but $60 billion a month for the bond market. The $200 million anti-poverty law – a measly sum in comparison – that Athens voted in this week is a no-no because Greek government has to ask permission for everything in Brussels first, says Brussels, no matter that that only prolongs the suffering. It’s not about money, in other words, it’s about power, and the Greeks must be subdued.
Both the financial and the political press have by now perfected their picture of Yanis Varoufakis as a combination of some kind of incompetent blunderer on the one hand, and a threat the size of Vladimir Putin on the other, while the rudeness of German FinMin Schäuble is not discussed at all. The media are no longer capable of reporting anything outside of their propaganda models. The ‘middle finger’ video turns out to be a fake, but who cares, it’s done its damage. Parenteau:
So let’s get this straight. The Troika does not have enough money to roll over Greek debt (in a Ponzi scheme like fashion, mind you) – debt that was incurred not so much as a bailout of Greece, but more as a bailout of German and other core nation banks and insurance companies and private investors who made stupid loans to or investments in Greece, but refused to fob them off on their own taxpayers.
But the Troika does have enough money to adequately perform damage control for the eurozone if Greece, because, you know, Greece is a “dispensable” eurozone member – even though ECB lawyers themselves say there is no legal mechanism for disposing of eurozone members in any such fashion.
No money in Greece for humanitarian aid in a country that may be on its way to becoming a failed nation state. No money outside Greece to roll over existing debt, or when necessary to extend and pretend, add more debt on existing debt to service the old debt, Charles Ponzi style. But somehow there is still “sufficient” money to ring fence Greece from the rest of the eurozone once Greece figures out it is dispensable and so must exit.
But that is not even the whole deception. It turns out the ECB does happen to have enough money to buy €60 billion per month of bonds from now until at least September 2016. Which means the same bondholders who are benefitting from the misnamed “bailout” funds used to keep the core nation financial institutions from collapsing under the weight of failed loans, can now count on a monthly government handout, courtesy of the ECB.
Some are more equal than others, in other words. That is true also of Ukraine, which gets to issue bonds guaranteed by the American taxpayer. If Greece could do that, they‘d have a way out of the dark pit austerity has thrown it in. And Greece isn’t even killing its own people…. But then Kiev doesn’t need to be subdued, it’s already being ruled exclusively by US stooges.
To come back to Schäuble lack of basic civil manners for a moment, it’s of course not true that Germany has an ironclad case against the Greek demands for WWII reparations. If it did, none of the rudeness would be necessary. And aside from that, even if the case was indeed closed, Germany would still need to be open and respectful and way more civilized than it is at present. WWII is a very black chapter in world history, and it’s not some very remote event. Even if post-WWII German schoolchildren never learned anything about what their parents and grandparents had done.
Maybe there’s a task here for the world Jewish community. Schäuble’s attitude smacks of denial, much more than respect for victims and their surviving family members. And besides, there were a lot of Greek Jews who became victim of German atrocities.
But to focus for now on the purely legal side of the matter, there’s at the very least a large grey area:
A growing number of legal experts are supporting Greece’s demands over the German war reparations from the country’s brutal Nazi occupation during World War II. Despite the official German refusal to address the issue, legal experts say now Athens has ground for the case. The hot issue is expected to be brought up by Greece’s newly elected Prime Minister Alexis Tsipras during his official visit to Berlin on Monday, where he is scheduled to hold a meeting with the German Chancellor Angela Merkel. [..]
The Greek leftist-led coalition government has repeatedly raised the issue causing Germany’s firm reaction as expressed by German Finance Minister Wolfgang Schaeuble, who recently warned Athens to forget the war reparations, underlining that the issue has been settled decades ago. Central to Germany’s argument is that 115 million deutschmarks have been paid to Greece in the 1960s, while similar deals were made with other European countries that suffered a Nazi occupation.
At the same time, though, lawyers from Germany and other countries have said the issue is not wrapped up, as Germany never agreed a universal deal to clear up reparations after its unconditional surrender. The German answer on that is that in 1990, before its reunification, the “Two plus Four Treaty” agreement was signed with the United Kingdom, the United States, the former Soviet Union and France, which renounced all future claims. According to Berlin, this agreement settles the issue for other states too.
“The German government’s argument is thin and contestable. It is not permissible to agree to a treaty at the expense of a third party, in this case Greece,” international law specialist Andreas Fischer-Lescano said, as cited by Reuters. Mr. Lescano’s opinion finds several other experts in agreement. One of them, the Greek lawyer Anestis Nessou, who works in Germany highlighted that “there is a lot of room for interpretation. Greece was not asked, so the claims have not gone away.”
Merkel had better start taking the matter very serious, and in a very respectful way to boot. Because no matter how well oiled the publicity spin machine is, Schäuble’s attitude, mirrored by many of his countrymen, will awaken in countries all across Europe the realization that they don’t want this from Germany, they won’t be ruled by Berlin, and they won’t stand for more German uncivilized behavior either. The memories are far too fresh for that.
As I said the other day, Merkel had better take the reins in all this, because she risks blowing up the entire European Union if she lets things slip further. Let Greece go, if only by trying to force it into some sort of debt servitude which the Greek people deem unacceptable on moral grounds, and the EU project will start shaking on its already feeble foundations.
There’s only one thing that can save the Union now: for Merkel to show compassion, with the Greeks, and with all other weaker members. And to stop the anti-Greek propaganda, immediately. Or else. It’s nonsense to pretend that this is merely a business issue, as is made clear by Parenteau above: there is very clearly plenty space to negotiate solutions with Greece that preserve everyone’s dignity. Refuse that, and you can kiss the EU goodbye. There’s alot more that plays into this than mere money issues. Ignore that, and you might as well dismantle the Union right now.
And there are indeed other approaches too. Like that of the German couple, whose story I picked up some 24 hours ago on RT, and which has since appeared on a whole scale of media:
A German couple visiting Greece have handed over a check for €875 to the mayor of the seaport town of Nafplio, saying they wanted to make amends for their government’s attitude for refusing to pay Second World War reparations. Nina Lahge, who works a 30-hour week, and Ludwig Zacaro, who is retired, made the symbolic gesture and explained that the amount of €875 would be the amount one person would owe if Germany’s entire war debt was divided by the population of 80 million Germans.
“If we, the 80 million Germans, would have to pay the debts of our country to Greece, everyone would owe €875 euros. In [a] display of solidarity and as a symbolic move we wanted to return this money, the €875 euros, to the Greek population,” they said.
They apologized for not being able to afford to pay for both of them. “We are ashamed of the arrogance, which our country and many of our fellow citizens show towards Greece,” they told local media in Nafplio, southern Greece. The Greek people are not responsible for the fiasco of their previous governments, they believe.
“Germany is the one owing to your country the World War II reparation money, part of which is also the forced loan of 1942,” they added. The couple was referring to a loan which the Nazis forced the Greek central bank to give the Third Reich during the WWII thus ruining the occupied country’s economy. The mayor of Nafplio, Dimitris Kotsouros, said the money had been donated to a local charity.
And a perhaps even better story comes, almost entirely under the radar, through Kathimerini. Turns out, where Brussels and Berlin spend their time blaming Tsipras and Varoufakis for everything that happens, Norway, not an EU or eurozone member, steps in to alleviate the worst of the suffering:
Athens Mayor Giorgos Kaminis, Norwegian Ambassador Sjur Larsen and the president of nongovernmental organization Solidarity Now, Stelios Zavvos, on Wednesday inaugurated a new program to provide support to the Greek capital’s poor. The Solidarity & Social Reintegration scheme comprises a food program benefiting 3,600 households, as well as a space provided by City Hall and managed by Solidarity Now where the organization will provide social, medical and legal aid, among other services.
“The aim is the immediate relief of those in need by providing food, medical care, social services, legal support, help finding employment, and support for single-parent families, children and other vulnerable groups,” said Larsen, whose country has donated 95.8% of the €4.3 million needed to fund the program. The other donors are Iceland and Liechtenstein.
Note: Brussels and the IMF have refused to do what Norway does. They have also refused to let the elected Greek government take care of its own people, without first asking permission to do so. It’s an insane situation, if you ask me. And I don’t see why the Greeks would stand for it any longer. If they vote to leave the eurozone, and perhaps the EU, they will have a hard time for a while, for sure, and it will be made much harder by the Troika, simply out of spite.
But they would face an at least equally hard time if they choose to stay inside the shackles Brussels and Berlin want to lock them in. The EU is supposed to be made up of independent nations. And while it’s certainly true that that is perhaps its fatal flaw, trying to take away that status from the Greeks will drive them away, and warn other countries as well that they could be next in line for the same shackles.
We’re looking at economic warfare here, and there can be no doubt that it will end with only losers on all sides. Unless Merkel wakes up and smells the roses.