Jul 272015
 July 27, 2015  Posted by at 7:06 am Finance Tagged with: , , , , , ,  7 Responses »

LoC Old Patent Office model room, Washington DC 1865

There’s always a great irony in anyone at all coming under pressure for doing exactly what they should be doing. Still, it happens a lot. The irony gets that much greater when the party in question is a government, and a much maligned one at that.

Of course Syriza had to look into options, possibilities, eventualities if ever the moment might come that Greece had to (were forced to) move beyond the euro. They would have been entirely in fault, and entirely remiss, if not outright criminally negligent, if they had never looked into this.

And of course this had to be done in secret. There is no other way. The proof is in the pudding: just look at the reactions to Varoufakis’ explanation to a group of investors of how he went about Tsipras’ pre-election-victory green light for exploring ‘beyond euro’ scenarios.

Just imagine what political opponents and international media would have made of it all had they known back in December. There are simply far too many ill-informed and/or sensationalist and/or political-gains-hungry voices out there to not do these things in secret.

These are the very same voices that now seek to use that very same secrecy to try and lay blame on Tsipras and Varoufakis. In a world where openness and honesty have been put out by the curb with so many other human and moral values, this is inevitable. But that cannot mean the research should never have been done.

Tsipras could not possibly have avoided -and remember this took place at least a month before his election victory, which was by no means assured- having the research done. And he could not possibly have avoided having it done in secret.

So what do all these people want now? Varoufakis implies he’s prepared for treason charges. That would be rich. It would mean treason charges for Tsipras too. And for anyone in Brussels or Berlin who’s ever had any ideas about Greece moving beyond the euro. Try Schäuble.

Hey, maybe we can indict the entire eurozone structure for not having studied, in depth, the consequences of a eurozone nation moving beyond the currency. Isn’t that precisely the kind of negligence that is the foundation of much that is going wrong vis-à-vis Greece?!

Many aspects of this latest drama should make clear not where Syriza went wrong, but where the entire eurozone structure is an abject failure for everyone involved. Let’s have an independent commission look into how on earth it is possible that a cabal of unelected movers and shakers gets full control over the entire financial structure of a democratically elected eurozone member government. By all means, let’s see the legal arguments for this.

What this episode shows us is not Tsipras et al bending the law, it shows us to what extent Brussels and Frankfurt have moved into de facto entirely lawless territory. Or rather, to what extent they have jockeyed themselves into a position where they can make up the laws as they go along.

Still, none of this means that Tsipras and Varoufakis ever wished to do things in secret, or that they ever coveted some secret revolutionary scheme that would have gone beyond the wishes of their voters.

They simply did the homework required of a party that could expect to perhaps come to power, and do so on a controversial mandate of halting the austerity seemingly inherent in the eurozone model, while not leaving the eurozone. That homework also, necessarily, meant looking at what to do with the central bank, the Mint, everything involved in the financial system.

The fact that these things were taken into consideration doesn’t mean Syriza was planning a coup of any kind at any moment in time (as is being loudly suggested), it just means they were thorough. If you want a coup, look instead at the Troika having wrestled control over Greek domestic finances. That’s a coup if you ever saw one.

There were always a number of possible outcomes, and being forced to move beyond the euro was always one of them (just as the present third bailout at gunpoint was). The Syriza team are not at fault for having explored this, they would have been at fault if they had NOT done it.

As for the details, they may look a bit on the edge, but since it’s always been clear from the outset that replacing an entire currency system with another, especially when that means a move away from a common currency, would be extremely time-consuming (perhaps a year or so), researching one form or another of an electronic or digital currency to help fill the gap makes far too much sense for the other side to try and exploit it to deride Syriza.

In the end, that’s just dumb.

We don’t know who leaked the tapes and/or transcripts to Kathimerini, and it doesn’t matter much either. It’s infinitely more important that what Varoufakis and his very small team of confidants sought to explore, A) had to be done in such stifling secrecy, and B) has not already been done -at least not out in the open- by the much larger teams available in Brussels, Frankfurt and Washington. Over the past 20 years or so, that is (talk about negligence).

That Varoufakis’ handful of confidants had to hack their own computer system in order to do what the Syriza government HAD to do, beyond any doubt, that is: try to avoid utter chaos if or when the ECB would shut down the Greek banking system, is an indictment of the entire eurozone, and the legal ‘liberties’ it has voted itself; it is by no means an indictment of Varoufakis, or Tsipras, or anyone in Syriza.

Nevertheless, that is exactly what you’re going to be reading and hearing in days to come. Greek opposition politicians, Greek media, as well as international media, will seek to grab this opportunity to hold the world upside down before your very eyes, and then convince you that what you see is the world as it really is, as it’s supposed to be.

That way, everyone involved think they can hide their own deficiencies and half-truths and (semi-)illegal acts behind the very, very rare, and very few people who do not wish to engage in any such acts. That is the world on its head.

For background, see:

Varoufakis Claims He Had Approval To Plan Parallel Banking System (Kathimerini)

Greece Rocked By Alleged Secret Plan To Raid Banks For Drachma Return (Guardian)

Varoufakis Reveals Cloak And Dagger Greece ‘Plan B’, Awaits Treason Charges (AEP)