• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

Greece's Tsipras calls referendum to break bailout deadlock

donsutherland1

DP Veteran
Joined
Oct 17, 2007
Messages
11,862
Reaction score
10,300
Location
New York
Gender
Male
Political Leaning
Centrist
From Reuters:

Greek Prime Minister Alexis Tsipras called a referendum on bailout demands from foreign creditors on Saturday, rejecting an "ultimatum" from lenders and putting a deal that could determine Greece's future in Europe to a risky popular vote.

After a week of acrimonious talks in Brussels, where Tsipras dismissed proposals from the lenders as "blackmail", the 40-year-old prime minister said parliament would meet on Saturday to approve holding a referendum on July 5.

Greece's Tsipras calls referendum to break bailout deadlock | Reuters

Leadership requires difficult choices at times. Unfortunately, the Greek Prime Minister decided to punt on his leadership responsibilities by delegating what is a grave decision to the general public, who almost surely lack the details related to Greece's fiscal situation, the EU/ECB/IMF offer, and understanding of the consequences involved. At the same time, he has shown little urgency with the scheduling, as the Greek Parliament would meet to discuss a referendum to be held on July 5, which is after the June 30 deadline for Greece's IMF payment.

Even if the Greek Prime Minister believes his punt will give him absolution from the consequences should Greece wind up in arrears to the IMF, it won't. His inability to lead lends further explanation to the chaotic path he has taken over the past several months, which has eroded Greece's small leverage, undermined the good faith others had, and imposed the Greek people to a deepening economic contraction and banking system risks. At a time when Greece needs a leader, it has a Prime Minister who lacks leadership capacity. This only compounds Greece's already terrible situation.
 
What a intensely cowardice thing to do.

He's leaving it up to the Greek people so he doesn't have to take responsibility when this blows up in his face.

He can tell the Greek people " hey guys, dont look at me, this is what you voted for ".

Unbelievable.
 
The ECB in particular has been working to sabotage the government of Greece, who were elected on a manifesto of renegotiating the impossible debt burden. There have been poorly concealed approaches to the defeated rightwing Greek parties on forming a government when the present one falls. Tsipras threatened to call a referendum 2 weeks ago, but now it's crunch time. Twice in the last week hopes have been raised and dashed of a resolution. The Greek people are well aware of what the catastrophic results of the austerity conditions they've already suffered, as imposed by the lenders have been, before another 8billion Euros of further cuts in this deal arrive, and will vote accordingly.

Paul Mason has been calling it fairly accurately so far.
Greece: a deal nobody believes in | Paul Mason | Paul Mason
 
I think the concept of holding a referendum on the issue is just. The people who are impacted the most by this are the Greeks, and it's only fair that they should have a say in their fate, rather than have the EU continue to push austerity on them.

Given that SYRIZA is polling even better now than in January, and that with the support of other anti-austerity parties, they have about 60% of the vote, I'd expect a no on the referendum at this point.
 
The ECB in particular has been working to sabotage the government of Greece, who were elected on a manifesto of renegotiating the impossible debt burden. There have been poorly concealed approaches to the defeated rightwing Greek parties on forming a government when the present one falls. Tsipras threatened to call a referendum 2 weeks ago, but now it's crunch time. Twice in the last week hopes have been raised and dashed of a resolution. The Greek people are well aware of what the catastrophic results of the austerity conditions they've already suffered, as imposed by the lenders have been, before another 8billion Euros of further cuts in this deal arrive, and will vote accordingly.

Paul Mason has been calling it fairly accurately so far.
Greece: a deal nobody believes in | Paul Mason | Paul Mason

The ECB has provided emergency assistance to Greece's banks that surpasses 60% of Greece's GDP. I don't think the current Greek government is in a strong position to criticize the ECB for its efforts.

The IMF has suggested that debt relief be included, but in exchange for structural reforms. Prime Minister Tsipiras has, in the end, turned out to have offered very little in the way of structural reforms, while branding the IMF "criminal," even as its suggested approach is vastly more generous than either the EU or ECB positions, both of which don't seek debt relief.

I feel badly for Greece's people, as I don't disagree about the high costs of austerity. However, ineffectual leadership has played a role in exacerbating the situation. Had a more flexible leader been in office, I suspect that not only would more generous terms have been agreed than what are now available (as some of the economic contraction might have been headed off), but a serious negotiation leading to the kind of debt relief envisioned by the IMF would also have been well underway.
 
I think the concept of holding a referendum on the issue is just. The people who are impacted the most by this are the Greeks, and it's only fair that they should have a say in their fate, rather than have the EU continue to push austerity on them.

Given that SYRIZA is polling even better now than in January, and that with the support of other anti-austerity parties, they have about 60% of the vote, I'd expect a no on the referendum at this point.

Well of-course you do.

If Syrzia says jump, Socialist say how high. The Greek people already voted, they elected or they thought they elected a leader. Not someone who's looking for a way to pass off his responsibility by holding a referendum.

He's looking to cover his ass Politically.

But then again, this was the same guy who tried to extort his way out of this mess by claiming Germany owed Greece 300 Million euro's in " Nazi war crime " fines unpaid.
 
Well of-course you do.

If Syrzia says jump, Socialist say how high. The Greek people already voted, they elected or they thought they elected a leader. Not someone who's looking for a way to pass off his responsibility by holding a referendum.

He's looking to cover his ass Politically.

But then again, this was the same guy who tried to extort his way out of this mess by claiming Germany owed Greece 300 Million euro's in " Nazi war crime " fines unpaid.

You're correct in that it is a smart move for Tsipras politically speaking. Is there any reason to suggest that a referendum is not what the Greek people want? Anti-bailout voters obviously want their voice heard, and pro-bailout voters would almost surely prefer the chance to vote in a referendum rather than the Greek government flat out telling the EU 'no.'
 
From Reuters:



Greece's Tsipras calls referendum to break bailout deadlock | Reuters

Leadership requires difficult choices at times. Unfortunately, the Greek Prime Minister decided to punt on his leadership responsibilities by delegating what is a grave decision to the general public, who almost surely lack the details related to Greece's fiscal situation, the EU/ECB/IMF offer, and understanding of the consequences involved. At the same time, he has shown little urgency with the scheduling, as the Greek Parliament would meet to discuss a referendum to be held on July 5, which is after the June 30 deadline for Greece's IMF payment.

Even if the Greek Prime Minister believes his punt will give him absolution from the consequences should Greece wind up in arrears to the IMF, it won't. His inability to lead lends further explanation to the chaotic path he has taken over the past several months, which has eroded Greece's small leverage, undermined the good faith others had, and imposed the Greek people to a deepening economic contraction and banking system risks. At a time when Greece needs a leader, it has a Prime Minister who lacks leadership capacity. This only compounds Greece's already terrible situation.

The EU/IMF have been pushing the idea that Tsipras has been behaving waywardly, not negotiating in the best interests of the Greek people and not being serious about market reforms. That's simply propaganda. The package that the Greek government has proposed is austere, probably too austere for the Greek public to accept, because Tsipras and Varoufakis have gone so far towards giving the lenders what they are demanding. There doesn't appear to be any substantive basis on which the EU/ECB/IMF negotiators should reject the Greek proposal. It strikes me, and I suspect Tsipras, that they aren't serious about negotiating a deal that the Greek people can accept. They are offering no debt relief, only more austerity, for a people who have had nothing else for the past 8 years.

Trying to present the stalemate as coming from the Greek side pushing a radical left-wing agenda is playing politics. Tsipras is rightly calling their bluff and demonstrating that they are not out of touch with the position their people hold. I'd say the EU/ECB/IMF position is one that is promoting a Grexit. They want Greece out of the Eurozone (and thereby out of the EU) and have not been negotiating in good faith.

It's rather ironic that the use of a referendum on a single, albeit major, issue is being portrayed as a lack of leadership when everyone on the right has been applauding the UK Tories' EU-exit referendum plans, the consequences of which are considerably more complicated, difficult to explain and debate than the Greek government's negotiating position. That's a red herring if ever I saw one!
 
Had a more flexible leader been in office, I suspect that not only would more generous terms have been agreed than what are now available (as some of the economic contraction might have been headed off), but a serious negotiation leading to the kind of debt relief envisioned by the IMF would also have been well underway.

I think for 'flexible' you really mean a weaker one. What exactly to you think Tsipras has held out on in terms of structural reforms? I think the negotiators are trying to punish Greece for having elected a left-wing government; they've already been sounding out the positions of the centre-right political opposition, looking to see what difference getting rid of Syriza would make to the negotiations. Hardly democratic, but then these aren't democratic institutions we're talking about.
 
The IMF is partly to blame for what happened in Greece: because they allowed the Greeks to borrow more than 200% of the country's quota (which is determined by each country's capital contribution to the IMF) which was the IMF stated limit for everybody,and then moreso than any other country- in fact I believe its over 1000%.

But unless Tsipras's party enacts major reforms (such as downsizing government spending and reforming tax collections to increase revenue) and so far it seems to have no intention of doing so, then this new government really is no better than the government it replaced.
 
But unless Tsipras's party enacts major reforms (such as downsizing government spending and reforming tax collections to increase revenue) and so far it seems to have no intention of doing so, then this new government really is no better than the government it replaced.

That's simply not true. That's exactly what they have proposed and exactly what the Troika have rejected. Tsipras proposed tax increases, extending pension age to 67 and cutting a number of government ministries, downsizing military and police spending and increasing staffing of departments that enforce anti-tax-avoidance measures. It's Troika propaganda to suggest that they are not doing everything humanly possible to address systemic problems.
 
It appears they have a point about the legality of the debt and restructuring plan taken on by previous governments too...

" As Greece and its international creditors race to agree on a bailout deal, the issue of the legality of Greek debt has been raised. The Greek parliament’s Truth Commission on Public Debt has released a report that rejects the legitimacy of the large sovereign debt restructuring. It alleges that a substantial part of the country’s €320 billion debt is illegal and “odious”.

The Truth Commission was set up by the Greek parliament in April 2015 with a mandate to audit the legitimacy of the Greek debt in light of Greek, EU and international law. The report concludes that Greek foreign debt should not be legally enforceable. As yet, it has no legal standing, but may well fuel Greece’s objections to its bailout plan in the weeks to come. ... "

" ...“Odious” originates in a highly regarded international law theory coined by Alexander Nahum Sack. The idea proclaims that public debt contracted against democratic principles by a regime for purposes other than the best interests of the nation, should not be enforceable. This is the case of colonial debts or debts incurred during a dictatorship. It refers to the legitimacy of the debt, which is lacking among those who dealt out the loans in the first place.... "

https://theconversation.com/explainer-could-greeces-debt-and-bailout-plan-be-illegal-43650
 
It's rather ironic that the use of a referendum on a single, albeit major, issue is being portrayed as a lack of leadership when everyone on the right has been applauding the UK Tories' EU-exit referendum plans, the consequences of which are considerably more complicated, difficult to explain and debate than the Greek government's negotiating position. That's a red herring if ever I saw one!

There's a big difference between a party's holding a referendum on an issue when there is time for clear, reasoned-debate, and one's calling a referendum when a crisis is unfolding to evade making tough decisions. The Greek Prime Minister took the latter course.

Not surprisingly, the Greek people have not gained any confidence in the wake of Prime Minister Tsipras' abdication of leadership responsibility. Instead, he appears to have touched off an all-out bank run. From Bloomberg.com:

Two senior Greek retail bank executives said as many as 500 of the country’s more than 7,000 ATMs had ran out of cash as of Saturday morning, and that some lenders may not be able open on Monday unless there was an emergency liquidity injection from the Bank of Greece. A central bank spokesman said it was making efforts to supply money to the system.

“I’m here to take my mother’s pension out before the machine runs out of cash,” said Erato Spyropoulou, who was standing in a line of about eight people at one of National Bank of Greece SA’s ATMs. “It’s very worrying what’s happening because people don’t know what they’re being asked to vote for. It’s the last nail on Greece’s coffin.”


Greeks Line Up at Banks and Drain ATMs After Tsipras Calls Vote - Bloomberg Business
 
For what it's worth, here is where things stood:

http://online.wsj.com/public/resources/documents/062415Greek.pdf

One big issue was pension reform (see p.3). Its early retirement concept was based on disincentives and a phase-in by 2022. However, it was not clear that the proposal was near universal. There was troubling language concerning an exemption for "other special categories" which was undefined and rejected by the EU/ECB/IMF. The creditors accepted the proposal that those in "arduous professions" and mothers with disabled children could retire early as was appropriate.

What were those "other special categories?" No definition was given. No number of persons was introduced. Was Greece really proposing to reduce early retirement for only a small fraction of its workforce? The actual extent of what Greece was providing was not known and not knowable from the language of the Greek proposal.
 
There's a big difference between a party's holding a referendum on an issue when there is time for clear, reasoned-debate, and one's calling a referendum when a crisis is unfolding to evade making tough decisions. The Greek Prime Minister took the latter course.
That's not at all what he's doing. What he's doing is to show the Troika, and the world in general, that the Greek government's position is precisely the reflection of the will of the Greek nation. He's already drawn very stiff opposition to the extent to which he has compromised towards the Troika's position. Were he to agree to their entire position then he might well have to resign, which would have the same effect as defaulting, since there would be a period of leaderless government until a new election could take place.

The Troika knows this, but they are playing a largely political game. They want Syriza out of government, they'd prefer a right-wing government that will apply austerity in the way that they dictate.

Not surprisingly, the Greek people have not gained any confidence in the wake of Prime Minister Tsipras' abdication of leadership responsibility. Instead, he appears to have touched off an all-out bank run.
It's not the government's position that's causing the run on the banks; it's the threats from the Troika that are doing that.
 
For what it's worth, here is where things stood:

http://online.wsj.com/public/resources/documents/062415Greek.pdf

One big issue was pension reform (see p.3). Its early retirement concept was based on disincentives and a phase-in by 2022. However, it was not clear that the proposal was near universal. There was troubling language concerning an exemption for "other special categories" which was undefined and rejected by the EU/ECB/IMF. The creditors accepted the proposal that those in "arduous professions" and mothers with disabled children could retire early as was appropriate.

What were those "other special categories?" No definition was given. No number of persons was introduced. Was Greece really proposing to reduce early retirement for only a small fraction of its workforce? The actual extent of what Greece was providing was not known and not knowable from the language of the Greek proposal.
No. You'd only draw that conclusion if you had a political agenda to refuse any condition that you didn't come up with. I don't believe there was any package of proposals that the Greeks could come up with that the Troika would have accepted. They've decided some time ago that Grexit is their preferred option.
 
What a intensely cowardice thing to do.

He's leaving it up to the Greek people so he doesn't have to take responsibility when this blows up in his face.

He can tell the Greek people " hey guys, dont look at me, this is what you voted for ".

Unbelievable.

I have to disagree with you on this.

I see nothing wrong with letting the people decide their fate.

Sure, it maybe cowardly, but almost all politicians are cowardly...so nothing new there.

I think there should ALWAYS be a referendum for major national decisions...no matter what the politicians intentions really are.
 
If I was him I would demand Germany pay reparations for World War II. Problem solved.
 
No. You'd only draw that conclusion if you had a political agenda to refuse any condition that you didn't come up with. I don't believe there was any package of proposals that the Greeks could come up with that the Troika would have accepted. They've decided some time ago that Grexit is their preferred option.

Why did the Greek Government propose exempting "other special categories" and not define them? There's reasonable understanding what constitutes "arduous professions" and the population of mothers with disabled children. One can estimate the impact of pension reforms from exempting those two groups, which is reasonable. But one can't estimate the impact from an undefined "other special categories." That was a key pension-related sticking point that the creditors rejected. A mature Greek leader would have then countered with specificity and then the parties would be able to evaluate the pension reform proposal. No such specificity was forthcoming. Days later, the Greek leadership would punt to try to evade its responsibilities.

If anything, Grexit might well be the Tsipiras' government's preferred option. It made unsustainable campaign promises. It tried to extort reparations from Germany. It vilified the IMF, which is the party who has gone farthest on debt relief e.g., restructuring.

It has now punted at the moment where decision is needed. It has shown little regard that the consequences of its punt could be effectively the same as if it had rejected the EU/ECB/IMF proposal.
 
If I was him I would demand Germany pay reparations for World War II. Problem solved.

That issue was settled in a 1990 treaty. Germany owes no further money to Greece from World War II.
 
That can be changed I think.

http://money.cnn.com...ages/index.html

I don't see how Syriza can "lose" politically here, whereas Merkel & minions have nothing to gain. Except maybe contempt.

There is no welfare state a la Germany or Sweden in Greece. If you are out of a job for more than a year (or maybe 9 months) apparently you do not receive anything, not even foodstamps.



The idiot politicians like Merkel do not enjoy the suffering of the poorer half of the Greek population. They simply do not care about them. What they cannot admit is that the austerity measures have utterly failed (they have rather worked as the worked everytime and everywhere and exactly as predicted by some economists, i.e. they made the situation worse) and they want to avoid a similar development in Portugal (or God forbid, Spain). So Greece might be thrown to the dogs to avoid a leftist development in e.g. Spain at all costs.
 
Why did the Greek Government propose exempting "other special categories" and not define them? There's reasonable understanding what constitutes "arduous professions" and the population of mothers with disabled children. One can estimate the impact of pension reforms from exempting those two groups, which is reasonable. But one can't estimate the impact from an undefined "other special categories." That was a key pension-related sticking point that the creditors rejected. A mature Greek leader would have then countered with specificity and then the parties would be able to evaluate the pension reform proposal. No such specificity was forthcoming. Days later, the Greek leadership would punt to try to evade its responsibilities.

If anything, Grexit might well be the Tsipiras' government's preferred option. It made unsustainable campaign promises. It tried to extort reparations from Germany. It vilified the IMF, which is the party who has gone farthest on debt relief e.g., restructuring.

It has now punted at the moment where decision is needed. It has shown little regard that the consequences of its punt could be effectively the same as if it had rejected the EU/ECB/IMF proposal.

You appear to believe that a negotiation involves nothing other than that the 'weaker' party capitulate to the stronger party and deal with the consequences. The Greek position is that to accept the Troika's position, which doesn't involve any debt relief, would inevitably lead to default and Grexit. That's the Troika's position on the Greek proposal, so I guess Grexit is going to happen irrespective. Better that the Greek electorate get to determine the way that will happen, and express their disgust at the institutions that have forced it to happen, when it didn't need to. Let's hope that the consequences of the Greek default are as serious on the creditors as they will certainly be for the Greek people.
 
There is no welfare state a la Germany or Sweden in Greece. If you are out of a job for more than a year (or maybe 9 months) apparently you do not receive anything, not even foodstamps.
That the situation in most of the southern European nations. Here the government suspended all welfare benefit payments for 3 months last year. they said that they would be repaid, but that hasn't happened yet. Those who blame government debt in southern Europe on a bloated welfare state really don't know what they're talking about.

The idiot politicians like Merkel do not enjoy the suffering of the poorer half of the Greek population. They simply do not care about them. What they cannot admit is that the austerity measures have utterly failed (they have rather worked as the worked everytime and everywhere and exactly as predicted by some economists, i.e. they made the situation worse) and they want to avoid a similar development in Portugal (or God forbid, Spain). So Greece might be thrown to the dogs to avoid a leftist development in e.g. Spain at all costs.
It would be a serious miscalculation to assume that Grexit will persuade southern European voters that they need to stick with the austerity policies that are killing economies and blaming it on the poor. Or to assume that people are so stupid as to believe that the Grexit wasn't as much the fault of the Eurozone economic imperialists as it was their domestic stooges who built up the debts in the first place.

Let's be absolutely clear that it is neither the Greek people, nor the Syriza government who bear any responsibility for their predicament. It was the political oligarchies, their criminal and corrupt banking institutions and the creditor institutions who allowed the debt to spiral beyond the ability of the country to manage them. As so many people have said before, it has been the privatisation of profit and the nationalisation of private debt that has brought this about.
 
That issue was settled in a 1990 treaty. Germany owes no further money to Greece from World War II.

Not true. The Greeks never agreed to that 1990 treaty. In actual fact, they were never asked to. They have never accepted the 2+4 agreement and hence have never cancelled the war reparations debt that Germany still owes.
 
Back
Top Bottom