A lot of people here seem to have no clue about what's happening in Greece.....

[brooklynite]

In reading responses to the news from Greece, I find that a lot of people are responding emotionally (Screw the banksters! Screw Germany! The Greeks are standing up to the 1%!) and showing no apparent understanding of what’s going on. International finance isn’t my area of expertise, so I went to someone for whom it is: my wife, a respect Tax Attorney with a specialty in international financial transactions. So allow me to clarify some important points.

1. Who’s to blame?

Answer: just about everybody. Yes, previous right-wing Greek Administrations did shady deals with investment banks, and got stung during the 2008-2010 recession. However, it’s not enough to blame them and “the 1%ers&quot . Greece has three additional problems: a relatively weak economy (Greece has very few industries, and imports a lot of its food), public spending (a high proportion of government salaries and generous, early retirement pensions) that’s not commensurate with its economic health, and a notoriously low tax compliance philosophy that runs throughout Greek society. Financial restructuring is necessary but likely incredibly painful to the Greeck population, and thus incredibly dangerous for the Greek Government.

At the same time, the ECB and the foreign entities (particularly German) who’ve been providing “temporary” financial support have been stubborn by demanding a full payment of Greek debts, as well as restructuring the Greek economy. My wife’s view is that it’s functionally impossible to pay them off completely, and Greek’s creditors should recognize that. On the other hand, if they offer a sweetheart deal to Greece, what happens when payments come do for Spain, Portugal or other at-risk States?

2. What about the referendum?

The referendum held last weekend was a huge mistake. It allowed the Greek Government to avoid the immediate hard questions by rallying national pride and “sending a message” to the EU, while leaving the Greeks with no alternative solution, and hardening the resolve of their creditors to demand a settlement. As a result, Tsipras is faced with a likely set of harder terms (on both repayment and Government spending) than he was facing last week; if he gives in he’s likely to lose his political support; and if he refuses; Greece's funding will be cut off, and they'll be dropped from the EuroZone. Bottom line: this was not a “victory” for the working class; it was an invitation to a duel where one person’s gun has no bullets.

3. Why can’t Greece just stop paying the evil banks?

Two questions: why can’t it stop paying the European Central Bank (equivalent of the Federal Reserve) or the IMF and why can’t it stop paying the Greek banks? The second question first: the Greek banks, which weren’t the ones involved in the shady dealing above, loaned a lot of money to the Greek Government from their deposit assets, and the Greek Government can’t pay them back. THAT’s why the banks have been closed for a week: the Government ISN’T paying them, and they don’t have the cash on hand to pay back depositors (including small businesses and pensioners); in the current crisis, they’d collapse if there was a run on them. They HAD been receiving cash infusions from the ECB, but like the Treasury Dept printing money, there’s a risk of European inflation if too many bills are in circulation, so the infusion was supposed to be a temporary measure which was paid back. Needless to say, that’s not happening.

As to why it can’t just refuse to pay the “big banks”? Effectively, that would mean a default on its loans. Greece is sovereign, so the ECB can’t come in and seize their cars and houses, but it would mean two things: expulsion from the EuroZone and the inability to borrow for the foreseeable future. Some people here think that returning to the Drachma would be a sign of independence. But the problem is that that there would be no value BEHIND the Drachma. It would plunge in value against the Euro, and anyone providing imports would want cash up front and a high exchange rate, if they’d accept them at all. Others have suggested that Greece should just continue to use the Euro unofficially, as some nations (generally in the Caribbean us the US Dollar). That works in a small nation where there a large influx of bills from tourists; it would be next to impossible to keep the economy running with whatever spare Euros happen to be available.

4. What needs to happen now?

Serious negotiating on everyone’s part, without any political posturing. Greece must be prepared to cut Government spending and pensions, NOT because they’re not necessary, but because they’re not affordable. Until it can find a way to jumpstart economic activity AND find a way to collect tax revenue from every social class, it will have to cut its spending accordingly.

Meanwhile, the EU and Greek’s creditors have to recognize that they won’t be getting full payment any time soon, and will need to either restructure the loans to cut some of the indebtedness, or reduce interest rates to a point that Greece can afford to pay them (a level that I don’t think is practical).

[SidDithers]

1. DU rec...

Good post.

Sid

[Wellstone ruled]

2. Thamks for the post.

As someone who criticized the Greek Banks,fully understand what has to be do to turn this mess around. Much like Italy, Greece has a reputation or a blood sport for avoiding paying taxes. This has to be addressed,have acquaintances from Greece whom laughed about how they would avoid paying taxes and rest assured they could not wait for their Pensions at age 55. Like you say,more to this mess than we see.

[A HERETIC I AM]

3. Nicely done.

Well written. Tell your wife Thanks!

I find it amusing how many Du'ers seem to think that the average Greek citizen is somehow a victim when, as you point out, not paying taxes is virtually a national pastime.

I wonder if they have anything close to an IRS or if employers report wages like we do here via the W-2 form. I'm thinking no, as I read there are many, MANY people, both middle class and above that claim annual salaries of 12,000 Euro so they are below the tax threshold.

Someone posted the other day a claim that the "banksters" sold Greece bonds of some description and loaned them the money to buy them. A more absurd idea I haven't read in quite some time. That and the repeated calls for just letting the banks collapse.

Yeah, and take many millions of peoples life savings with it. That point never seems to get mentioned.

FWIW, I lived in the Athens area in the 1960's. The house we lived in was one of only two on the street, cut into a hillside. Now it is elbow to elbow, according to Google's street view.

[zipplewrath]

8. A bit of a logical fallacy.

I understand that your point was to counter all the "Greece is a victim" position here. But you fail to explain that this is the case of the "drug dealer versus the addict" situation. The creditors need to take a serious haircut here. The people of Greece have already begun to pay their price. But now the "Krugman solution" needs to be implemented. Stimulus to the point that Greece can ultimately get out of the hole they're in.

[A HERETIC I AM]

23. When I lived there in the 60's....

There were unfinished construction projects all over the place. It seems to me that back then there wasn't a whole lot of bank lending going on, or if there was, they never lent enough to finish a project. Even the house I lived in had a basement that was still littered with construction debris. People just built with the money they had on hand and when it ran out, they would mothball the project until more funds were available.

The Greeks have a unique way of looking at things. It is charming in a way, but as the OP points out, they have no major industries that export - no Greek automobiles, for example. When I lived there the entire city - well most everything anyway, SHUT DOWN for 2 or 3 hours around noon. They would eat a huge lunch then take a nap. Then they would come back to work and stay at it till sundown.

I may have failed to point out something you would have liked to see, but the fact is, both rich, poor and middle class Greeks, as well as businesses and institutions brought this on themselves. There were plenty of stories only a couple years ago of the corruption and graft that was rampant thru out Greek society when the EU was flush and the banks wanted to lend money. Sure they took it! So did the Americans when money was cheap and easy to get. That's exactly what drove the housing bubble. In spite of what many DU'ers want to admit, the "great recession " was caused by the greed of the average American just as much as it was caused by the people facilitating them.

Your statement that the "creditors need to take a serious haircut here" is already happening/happened. There is a big problem with that however. It will be a hot day on Mt. Olympus before they will get much more. Most people that buy bonds don't really like it too much when they don't get their money back, much less promised interest payments.

So you have a country with the population roughly that of the LA Metroplex that consists of people who don't pay taxes as a matter of course and seem to think the government just farts money like magic. Outside entities start throwing money at them and they gobble it up! Huh. Imagine that.

I think they need whatever it takes to stabilize their economy. I don't want to see the average Olive Orchard worker suffer, don't get me wrong. But they need some bottom-up reworking if they expect to be a modern economy.

[zipplewrath]

33. you realize your experience is now roughly 50 years old.

A lot has changed, especially in the last 7 years or so. All I'm really saying is what Krugman is trying to say. Bad debts are just that and Greece SHOULD have a hard time getting loans for a while. But in the interim, they need some stimulus so that everyone benefits, including their creditors. Otherwise it's going to look more like 1930's Germany than 1990's Canada.

[A HERETIC I AM]

51. Of course I do!

Fair enough.

I am getting tired of posting on this website though.

I've never been prolific, but it is as if a contrary opinion has no merit in the least.

Of course, that isn't new, just more pronounced these days.


Yes...I'm 56. I'm old, but I can still do the math.

[JackRiddler]

107. Not only 50 years old

But flat-out wrong. About then, and about now. The prejudices of the Greek right wing presented as reporting.

[JDPriestly]

75. On this I agree:

Greece "need[s] some bottom-up reworking if they expect to be a modern economy."

But I disagree that lenders and borrowers are on an even playing field in terms of responsibility for a loan.

The lender is responsible for insuring that it/he/she lends responsibly especially when lending other people's money.

The banks were utterly irresponsible over the past more than 40 years with regard to their role in the world's and the Greek and our economies.

Bankers are supposed to be the people who understand how money works, how it is earned and spent. They are the keepers of the safety and health of the economy.

Your post utterly ignores the reality of the pressure that banks placed on people to loan beginning during the Reagan administration.

Prior to the crash and even for a time after it, we received letters offering credit cards, second mortgages, money, money, money nearly every day.

Banks are supposed to assess the ability of a borrower to repay a loan before granting the loan. That is where our system failed prior to the 2008 crash. Because of the derivatives, because bankers believed they could dice and slice risk so that lousy loans, loans given to people with no ability to repay could be coupled with good loans, loans given to people who would assuredly repay, they could afford to take risks that were unwise and too great for the economic reality. That is the fault of the bankers, not of the individuals who thought that if the bank deemed them credit-worthy, they probably were.

I recall the bankers of the 1960s, before the crash of the savings and loan industry in the 1980s. They were cautious and protected the money that depositors entrusted to them.

Our banks and investment houses today no longer acknowledge or deem important their role in taking responsibility for investing and loaning money in a way to make our economy more sure-footed, more secure and more prosperous. They seem to just view their roles as to make as much money for their bank as possible in order to insure ever higher salaries for themselves.

I disagree with you completely with regard to who is responsible for the crash and for the poor decisions made by the banks.

Who is responsible when a child of 10 gorges out on candy and gets a tummy ache? The parents or people who allowed the child to gorge out. The bankers are the parents or should be the parents and protectors of our economic health. Instead they have turned into candy gougers themselves. Our banking system is immature. The banks need some parents to get them to eat their peas and behave well.

Banks are supposed to be the conservative forces in our economies. They have not been that since the Reagan financial circus began.

Hopefully, Bernie Sanders, with his common sense approach to everything can bring the banks back to their senses.

The fiasco in Greece is a tragedy in which all parties played sinister roles except perhaps those Greek people who did not borrow money, but who worked and now can't have the pensions they earned.

By the way, a lot of Greek people work outside Greece during their most productive years. And that is one of the problems. A lot of Greek people earn money in places like Germany and that is why they don't pay Greek taxes.

[Munificence]

168. You know

you are trying to lay the blame on "the banks" (and they are evil bastards in my mind) but yet to see that this past crash was because our government said to the banks: "Loan to everyone that can breath and we will back you". Gov wanted everyone to be a homeowner so they told the banks to loan to folks that could not normally afford a home, had no down payment and paid a lot of interest only loans. Our government is responsible for this.

The folks that could barely pay their mortgage were then getting offers to "pull the equity out of your home" and low and behold they refinanced in a bubble (the one our gov created), used the cash to buy "crap" to keep up with their neighbors and then it all came crashing down.

0%-3% down is back....how many years is gonna take this time?

[JDPriestly]

178. The banks had to know what would happen with that policy.

The rules about qualifying for loans were there. The banks ignored them and helped people cheat.

Why do I say the banks had to know it was a bubble? Because I knew.

I stood in front of my neighbor's house and the two of us talked about how we couldn't believe the prices of houses in our neighborhood, what our neighbors houses were selling for. The housing prices skyrocketed but the wages had stagnated.

The housing bubble was as obvious as the dot.com bubble in the Clinton era.

Wages weren't rising. Prices of housing in middle class or working class neighborhoods like mine can only realistically rise as wages rise. And wages weren't rising.

Banks had to know. They know how much money people have in savings and checking accounts. They knew. They cheated.

When you have more information or more insights or more economic power, you are more responsible for what you do and for the effects of what you do. That's just the fact. That's backed up over and over by history and by human experience. With great gifts come great responsibilities. The banks had the gifts but did not take the responsibility. Individual homeowners for the most part did not have enough perspective, not the kind of information or understanding that bankers were supposed to have. The banks simply cheated. And that is inexcusable.

[hill2016]

181. well by that government

(1) The government bears even more responsibility as they have even more insights, information, and economic power.

(2) If banks were strict about credit, they could be accused of redlining or disparate discrimination. How do you reconcile that?

[JDPriestly]

183. That was the Bush government -- anti-regulation.

It doesn't do any good to be lenient about credit because those who borrow have to repay the loans. And the ability or likely ability to repay a loan should be the only question about qualifying for a loan.

[hill2016]

184. well

according to the recent supreme court decision, disparate impact does apply to the fair housing act

Which means that if banks only look at the ability or likely ability to repay a loan they could be guilty of unintentional discrimination against certain protected classes

[JDPriestly]

185. Unless they are redlining communities by racial prevalence, individual loans are and should

be given according to the borrower's ability to pay. It is not a kindness to any would-be borrower to give them a loan they can't repay.

We did not qualify for much of a house when we bought ours. We did not have the income. That's the way it is. Race has nothing to do with requiring people to prove they have the income to buy the house for which a loan is being made.

[DFW]

59. There is a lot of maintaining of fiction to be done

The creditors do indeed "need to take a serious hair cut," but in fact they already have--long ago, in fact. Anyone who thinks any of this debt will really be repaid is taking hallucinogenic drugs. It gets carried on the books so that balance sheets don't suddenly look like Old Mother Hubbard's cupboard, but it's a fiction. Everyone knows it's a fiction, but like the emperor's new clothes, no one wants to be the first to say out loud that there's nothing there.

To get the country going again, I agree, a stimulus is needed. Now comes the hard part. Where will this stimulus come from? From creditors who have already thrown good money after bad five times in a row? Probably not. From the ECB? Their rules prohibit them from propping up failed banks. From German taxpayers? You mean those people who the Greeks called Nazis and saw their popular first woman chancellor portrayed by Greeks with a Hitler moustache? That is going to be a hard sell, if the attitude of my solidly SPD/Greens voting German wife is any indication. Obama got a stimulus because first of all, the red states needed a stimulus, too after Cheneybush, and second of all, he had a Federal Reserve. Greece has no reserve anything. They are flat broke as a country, and it is a good thing for them it is tourist season with Germans, Brits, French, Dutch, Americans and Scandinavians overrunning the place with summer vacation cash. At least the tourist industry will be solvent for a few months. The Greeks will soon have no choice but to crawl to the Germans again asking for more money to throw down their drain, and the Germans might well say, "you're asking us Nazis? you must have dialed the wrong number, right?"

[JDPriestly]

81. Except that a healthy Greece is in Germany's interest.

Greece is a hop, skip and a jump away from Syria and Turkey and ISIS, and I'm sure that Angela Merkel is very aware of that.

Greece simply has to be propped up one way or the other.

Greece needs more than a loan. It needs an economic development plan and mentoring.

Remember, Greece only left the Ottoman Empire in 1821. That is how close Greece is to the Middle East and the turmoil there. Greece had a military junta at least in 1973, and I think 1974. The junta did not allow Greek people to bring in or receive foreign newspapers, not even the London Financial Times. It was pretty repressive in that respect.

So Greece in terms of development is not on a par with other European countries of the North. But its location makes it essential to the security of Northern Europe.

Greece has to be helped. It will receive a bail out. It needs an economic development plan, not the imposition of austerity. The austerity made it harder for Greece to repay its debts.

Going back to the Drachma might be good for Greece.

Watch the videos on this topic by Bill Black and by Richard Wolff. They have a lot of expertise. Bill Black has experience with the savings and loan bailout here. He knows the score when it comes to banking.

The US has a terrible balance of payments deficit, and Bush II fought two wars without paying for either of them. Both were fought "off" the budget on borrowed money for all practical purposes. Our country's economic position is not all that great. We should be careful who we criticize.

And we should remember that Germany, ironically, was forgiven enormous debts after WWII, even though it was the bad actor in both WWII and WWI and that's what the debts were for -- it's cruel invasions of other countries and its racist killings. Yet the world forgave Germany its debts. Germany will forgive Greece' debts or suffer the consequences.

The best solution I have heard of so far is that an international congress be held on debt repayment. That is what needs to happen. It isn't just Greece and Germany that need restructuring.

Might I add that Greece is what happens when countries pretend that all countries are equal in terms of their economic worth and ability to compete with each other. Greece is what happens when countries give up all devices that protect their economy, that reflect the needs of their economy, to a system that holds the individual country responsible for its solvency but expects that company to compete against companies with greater trading advantages.

It's the same problem we have. Our currency is overvalued. Therefore we cannot compete in terms of exports with countries that make sure their currencies are undervalued. Yet we pretend that we are all trading freely and blame ourselves when our products and services are undercut by other countries. Who benefits from that system? People with a lot of money who can profit at the expense of countries they sell out. And that is what has happened in Greece to a great extent. Entering the TPP market will tear down our own economy even further, make us even less competitive and create an economic downturn here once again.

We should not look down on Greece. We could be Greece in 20-30 years.

[DFW]

87. Some of that yes, some I disagree with

The world definitely did NOT forgive Germany its debts, not all of them anyway. After bleeding it dry (and the Soviets looting Berlin in 1945, much of which I have personally seen since 1990, when some rogue KGB guys made off with every gram of gold they took from the Reichsbank), some debt was forgiven. By no means all. That is a fiction spouted by Greeks who want Germany to forget all their debt today. Germany was bled dry after 1918, which is one of the reason the Nazis were able to rise in the 20 years following. Juliusturm gold coins still come on the market out of France and Belgium even now.

Going back to the drachma might indeed be good, albeit painful, for Greece. The Germans are close to done with giving them euros. The euro made it easier for Greeks to buy a Mercedes, all 0.5% of them that could afford it. And it isn't Germany that needs restructuring, just Greece. One radical step would be for all people holding worthless Greek IOUs to publicly admit they are indeed worthless. Forgiving the debt would be fatal for the Greeks in the absence of a complete structural overhaul of their economy, and, in part of their society. For that to happen, they would have to swallow their pride and let the EU or some outside authority do it for them, as they never will do it themselves. Not Syriza, not the center-right, and certainly not Golden Dawn. Throwing more money at Greece without forcing a restructuring is like that classic definition of insanity. Tsipiras will dance around the issue as long as he can, but he will fail if that is all he is willing to do. At some point an angry mob will haul him out in front of an ad hoc firing squad. Not figuratively, but like Ceauşescu, the real thing. They do that in Balkan countries.

We should, too, look down on Greece. They are a classic example of what should NOT happen to a country. If its financial institutions are completely dysfunctional, and it produces nothing the world wants and needs, collapse is almost inevitable. It is a classic example of an avoidable disaster that happened because the whole spectrum of their politicians stuck their collective heads in the sand. Tsipiras drew the short stick because the storm clouds came to a head on his watch, but he has showed no more inclination to pull his head out of the sand than any of the other ostriches that preceded him

We will only be Greece in 30 years if our means of production come to a halt, agricultural production dies from a lack of water, and our currency is looked over by a foreign entity. That doesn't give us carte blanche to act like irresponsible buffoons with the economy like Republicans usually do, but it does mean that we have had centuries to build an economy with some safeguards. The Greeks chose not to install them. Fair enough, but they shouldn't scream too loudly when the inevitable result manifests itself.

[JDPriestly]

99. Western European and American values about good government developed

over centuries. Lots of mistakes were made. WWII and WWI were mostly German mistakes.

The Napoleonic Wars and reverting back to monarchy every so many years were a couple of France's big mistakes.

We have made mistakes too.

But I think that the reality of domination by the Ottoman Empire, domination over a Christian country by a country that held Greece in contempt, is a cultural legacy that makes it hard for Greece to organize a rational government. Greece needs a development plan along with either forgiveness or stretching out the debt repayment.

Germany enjoyed the forgiveness of a lot of its debt from 2 world wars. That's just history.

Here: a couple of experts on economics and economic history on Greece's debt and Germany's debt forgiveness after WWII.

Thomas Piketty: Germany Shouldn't Be Telling Greece To Repay Debt
http://www.huffingtonpost.com/2015/07/06/piketty-germany-greek-debt_n_7735866.html

Richard Wolff on the crisis

Economist Richard Wolff on Roots of Greek Crisis, Debt Relief & Rise of Anti-Capitalism in Europe

http://www.democracynow.org/2015/7/7/economist_richard_wolff_on_roots_of

And William Black , U. of Missouri, who was a leader in dealing with the US S&L crisis.

TRNN: "US Hedge Funds Get Bailed Out if Greeks Pass Bailout Referendum"/Bill Black & Michael Hudson

http://www.democraticunderground.com/1017275705

[DFW]

113. Forgiveness will become involuntary and stretching out the debt is a myth

It will never be repaid. Ever. The sooner that is dealt with, the better. I'm aware of Piketty and Wolff, not Black--that one I'll try and find time to check out. Not today, as we are packing for 2 months in the USA. I barely have time for this.

We see eye to eye on the effect of the Turkish occupation, but I still see no way to rectify its lasting effects. We can't forcibly alter the Greeks' mindset, and yet, that is the ONLY way out of this. It's not just their debt they need restructured, it's their whole society. It must be done if they are to move forward. They won't do it on their own, and no one is going to force them. Ergo....?

Germany did enjoy much forgiveness for its war debts (by NO means all, not by a long shot, that part is just propaganda)--more so after WWII (wisely so, as it provided the economic engine which pulled many of its former enemies out of the soup in the postwar period, notably France, Italy, and Yugoslavia). The harsh imposition of conditions after WWI was one of the main causes of WWII, though GB and F were foolish to think Hitler would ever be contained by negotiation. Stalin was so greedy for half of Poland, he was blinded to Hitler's ambitions in the east as well. Considering what could have happened to Germany and Austria had there NOT been a WWII (i.e. the Nazis getting the atomic bomb first), I guess we should just accept history for what it is/was and not try to change it.

We definitely have made mistakes, too. I just wish we'd make a bigger effort at learning from them as opposed to the Bush doctrine of solving them by saying we never made any in the first place.

[zipplewrath]

174. I so wish that I was not on an extended trip

I have so much to say as about the idiocy of the government's procurement system, that is inappropriate to most threads.

[DFW]

189. You could spend a week on that subject

--and still not repeat yourself.

[magical thyme]

88. "From the ECB? Their rules prohibit them from propping up failed banks."

Except they have no problem ignoring their rules when it comes to Bulgaria, not even in the Euro Zone.

ECB to extend backstop to Bulgaria on Greek ructions -Bloomberg
http://www.reuters.com/article/2015/07/03/eurozone-greece-ecb-bulgaria-idUSL8N0ZJ22U20150703

[timdog44]

77. I think you found it.

First thing I noticed was the HRC emblem on the OP. That was my "give me a break moment". A bank supporter and a paid off bank supporter to boot. I used to think that I would vote D no matter. NOT. The solution, no matter the reason it started, in Greece is to forgive the debt. That is the only way they can become productive again. And don't blame the victim. And HRC is against that. If she gets the nomination I am going to vote for me. Timothy J Smith, Channahon, Illinois. Just so you can vote for me too if you want to. She will not be any different than Jeb Bush. I am ashamed of her. She is not a (D) but a (d). The creditors and their supporters need to take a haircut here. America first in all, and this means forgiving Greece.

[unblock]

21. fair enough to point out the greece is corrupt and inefficient, but we all have problems there.

america is rife with corruption, du is chock full of posts about rich people and corporations evading taxes, mostly "legally", albeit by having corrupted the legislative and enforcement processes.

it's not a "problem" for the u.s. federal government because we're a rich enough nation that we can support a fair amount of corruption and still pay the bills. wealth is a huge enabler!

but it does mean that it's a bit silly to overly focus on greece's particulars in this area. the problem is not so much corruption and lax enforcement per se, the problem is that it is simply a far weaker economy than others in the eurozone. people tend to pay their taxes more when they have money, when the economy is strong; not so much when the economy looks like what greece's looks like these days.

should they step up enforcement? sure, of course. easy to say, but sure, of course. but as long as the austerity regime persists, it would be like getting blood from a stone.


imho, better enforcement and carefully selected revenue generators have to be combined with debt forgiveness and extension, along with a stimulus sufficient to get the greek economy moving again.

[erronis]

28. And I think most Americans would be surprised at how little income is reported in the US

It is only the lowly wage earners that are forced to report all their earnings via federal forms. If you fail to report/pay you will be docked and shamed.

Anyone earning income in the high five upwards is looking for loopholes. Sometimes these are part of the tax code and are actually benevolent. If you have enough money to secure the services of a tax avoidance counselor you can find lots of ways to move funds around so the IRS or other agencies can't see them and wouldn't really want to go to prosecution.

This is just reported 1040 income. The IRS is not very diligent about non-reported or even 1099 income. They can't afford to be. The current congress has done whatever it can to prevent government agencies from investigating their constituent shenanigans. You have to be pretty damn egregious (and uncovered by some presso) to be hauled before any legal bar.

The US has learned well by every other country that had taxes and tariffs imposed upon it. The sheep will bleat and the lords will frolic.

Greece, France, England - thank you. You have taught us well!

[Fumesucker]

90. The frolicking lords hate it when the sheep frolic too

That's why Greece is being made an example of, the sheep had the temerity to frolic the same way as the lords and that makes the national character of Greece horrible in the eyes of the lords.

[Taitertots]

63. What is the lost tax revenue as a percent of GDP?

Hint It's orders of magnitude too small to help solve/prevent their current troubles.

[JDPriestly]

70. Some important economists explain:

http://www.democraticunderground.com/10026952900

http://www.democraticunderground.com/1017275705

As I understand it, government employees in Greece have to pay their taxes.

Greece needs reform, but not just austerity. It needs a serious economic development plan. It also needs debt forgiveness -- as Germany did after WWII.

A Greece that can protect itself from invasions and massive immigration is indispensable to a secure Northern Europe. Greece will not be allowed to fail. It should not have been allowed to fail to the extent that it has.

The Greek crisis is not a game of "Shame on you, you lazy bums." Remember, Greece was under the heavy hand and rule of the Ottoman Empire until 1821. As recently as 1973-74, it was ruled by a Greek military junta.

Greece needs help, but not just a financial bail-out. It needs to reconsider its tax system, its property ownership system, many, many things. A better legal system in terms of recording property ownership and imposing taxes appropriately is, according to some news reports needed.

The oligarchs in Greece are at fault in this sense: they profited greatly from the chaotic Greek governments that they supported. The Frankfurter Allgemeine reported that rich Greeks took the bail-out money or some of it and hid it around the world including buying properties in Bulgaria.

The Germans are at fault for having allowed their banks to purchase or accept Greek debt without questioning the Greek system.

An economic development program that includes not just fiscal reform but also legal restructuring and reform and a workable tax system that makes sure that income is taxed, including the income from wealthy shippers.

But Greece, because of its geography and geology is a poor country. It has valuable ports and is very close to Turkey and as Richard Wolff points out in the video, Syria and ISIS.

No matter the morality of the matter, Germany is foolish to underestimate the worth of Greece to Germany itself. Germany has already made too many mistakes in its relationship with Greece to try to turn its back on the country now.

[Agnosticsherbet]

4. This is a great source to understand what is going on,

made better by not being in the two main camps concerning the Greek Crises.
The first camp being that the Greeks are rebelling against he mean awful wicked 1%'er banks.

The second Camp being that the Greek crises is a direct result of a spendthrift nation living on easy debt getting its just deserts.

Thanks.

[quickesst]

5. Thanks to you...

...and your wife. Well done.

[FlaGatorJD]

6. Thanks a lot

Great coverage of the topics and options.

[think]

7. Why fail to mention Goldman Sachs by name since they were obviously very involved.

It's extremely obvious that Goldman Sachs used legal loopholes to skirt the law and hide the debt of the Greek government and make huge profits while doing so:

http://www.spiegel.de/international/europe/greek-debt-crisis-how-goldman-sachs-helped-greece-to-mask-its-true-debt-a-676634.html

http://www.bbc.com/news/world-europe-17108367

http://www.bloomberg.com/news/articles/2012-03-06/goldman-secret-greece-loan-shows-two-sinners-as-client-unravels

[Recursion]

15. Why does it matter which firm the Greek govt paid to do that?

[think]

31. The 1st question the OP addressed was who was to blame. Doesn't Goldman Sachs share in that blame?

Why are you so defensive about naming a bank that acted in a manor that could be considered less than ethical?

A bank that not only acted questionably in the Greek debt debacle but as Democratic Senator Carl Levin claimed misled Congress and duped Clients here in America:

Goldman Sachs Misled Congress, Duped Clients, Levin Says

by Robert Schmidt - April 14, 2011 — 6:36 PM EDT

April 14 (Bloomberg) -- Goldman Sachs Group Inc. misled clients and Congress about the firm’s bets on securities tied to the housing market, the chairman of the U.S. Senate panel that investigated the causes of the financial crisis said.

Senator Carl Levin, releasing the findings of a two-year inquiry yesterday, said he wants the Justice Department and the Securities and Exchange Commission to examine whether Goldman Sachs violated the law by misleading clients who bought the complex securities known as collateralized debt obligations without knowing the firm would benefit if they fell in value.

The Michigan Democrat also said federal prosecutors should review whether to bring perjury charges against Goldman Sachs Chief Executive Officer Lloyd Blankfein and other current and former employees who testified in Congress last year. Levin said they denied under oath that Goldman Sachs took a financial position against the mortgage market solely for its own profit, statements the senator said were untrue.

“In my judgment, Goldman clearly misled their clients and they misled the Congress,” Levin said at a press briefing yesterday where he and Senator Tom Coburn, an Oklahoma Republican, discussed the 640-page report from the Permanent Subcommittee on Investigations.

Read more:
http://www.bloomberg.com/news/articles/2011-04-14/goldman-sachs-misled-congress-after-duping-clients-over-cdos-levin-says

[Rex]

20. The people that caused the global economic disaster don't want to talk about lenders, just the

spenders. That way it looks like only one side is to blame. Class warfare at it's finest and some seem to be a little upset about getting called out.

As if the population of the world doesn't know by now how fucked up and criminal the 1% of the world are. Let them keep on bleating about those bad old spenders. Nobody in the real world that was effected (spenders) believes a word from the 1% club.

They are proven snake oil salesmen, nobody is fooled. They created a smart consumer class and now have to eat crow over Greece. Tough shit right? I for one love watching the elite squirm under the microscope and find it even funnier that they think we will just let this pass.

Not a chance.

[elleng]

24. Robert Reich discusses it:

People seem to forget that the Greek debt crisis -- which is becoming a European and even possibly a world economic crisis – grew out of a deal with Goldman Sachs, engineered by Goldman’s Lloyd Blankfein. Several years ago, Blankfein and his Goldman team helped Greece hide the true extent of its debt -- and in the process almost doubled it. When the first debt deal was struck in 2001, Greece owed about 600 million euros ($793 million) more than the 2.8 billion euros it had borrowed. Goldman then cooked up an off-the-books derivative for Greece that disguised the shortfall but increased the government’s losses to 5.1 billion euros. In 2005, the deal was restructured and the 5.1 billion euro debt was locked in. After that, Goldman and the rest of Wall Street pulled the global economy to its knees – whacking Greece even harder.
Undoubtedly, Greece suffers from years of corruption and tax avoidance by its wealthy. But Goldman Sachs isn't exactly innocent. It padded its profits by catastrophically leveraging up the global economy with secret, off-balance-sheet debt deals. Did any of its executives ever go to jail? Of course not. They all got fat bonuses and promotions. Blankfein, now CEO, raked in $24 million in 2014 alone. Meanwhile, the people of Greece struggle to buy medicine and food.
Doesn't seem right, does it?

https://www.facebook.com/RBReich?fref=ts

[erronis]

34. Thanks. Everywhere I look I see the stench of rampant capitalism

Which is only a way of bloodsuckers extracting whatever they can --- to do what?
Increase their portfolios?
Increase their bragging rights?
Add another digit to their net worth while consigning a whole country to debt and poverty?
Tell their mistresses and their spawn how wonderful they are?

Will their mausoleum make their bones more eternal than the ones they have consigned to early graves?

[think]

40. Thank you! Robert Reich's comments on GS's involvement are golden! /nt

[Calista241]

122. Greece owes over 320 billion euros.

Using your 5.1 billion euros number, Goldman is responsible for about 2% of Greece's total debt.

It would appear that Greece has a much larger problem than getting swindled by Goldman Sachs.

[stevenleser]

123. But a convenient bogeyman makes this whole thing so much easier.

Why are you spoiling the fun?

[Calista241]

133. Ah yes, when in doubt, blame a bank.

You'll get all kinds of Recs and agreement.

[think]

136. When a bank colludes to conceal a country's debt they shouldn't take any blame?

[stevenleser]

139. That poster asserted out that GS was involved with 2% of Greek debt. That barely warrants a mention

Trying to suggest that this means they were behind this whole thing is silly, no?

[think]

141. Who suggested GS is completely to blame? No one here has suggested that.

Goldman Sachs however, did play a very important part in hiding the debt so that the Greek government could then acquire much more debt beyond the 2% Goldman Sachs is DIRECTLY responsible for.

No one here has said Goldman Sachs is completely to blame but you by implying others here have.

And the fact that you and others try to dismiss that Goldman Sachs did play an important role in the Greek debt crisis is frankly disturbing...

[Calista241]

140. I didn't say that either.

But the scale of the problem is so much bigger than what 1 bank did back in 2005.

People are focusing on just this one aspect, and they're missing the vast majority of the problems.

If they fined GS the 5.1 billion plus interest, and threw the CEO in jail, there's still this huge pile of stinking shit to take care of.

[think]

144. Goldman Sachs started intervening in 2001 not 2005. And GS's role in hiding that debt allowed

the Greek government to acquire much greater amounts of debts which exacerbated the problem to the extreme levels that now makes the debt untenable.

No one is saying it's all Goldman's fault. Obviously the former Greek government is centrally to blame. However what Goldman Sachs did to help the former Greek government mask their debts is certainly questionable on an ethical level.

And Goldman Sachs isn't just some bank. It's one of the most powerful banks on earth and was directly involved in financial shenanigans that lead to the US melt down in 2008.

[Rex]

124. GS has it's enablers, just because you know...the enormously wealthy need to be defended

by nobody usernames on a political forum. I guess someone is buying their bullshit excuses, thankfully it is nobody on this forum.

[greatauntoftriplets]

9. Excellent explanation.

[unblock]

11. great post, though i disagree about the referendum --

first, i think everyone's making way too much of it. it had no particular legal weight, it was a rejection of terms that were already off the table. the creditors are taking it as an excuse to claim they are highly offended, but that's petty and silly. they can't expect debtors to like it when creditors demonstrate very little flexibility, never mind what the greek economy has been like for the last five years or so.

second, i completely disagree that it works against tsipras. getting a rousing endorsement of your view strengthens your negotiating position, that's pretty basic. tsipras is now in a position to play good cop with the greek voters being bad cop. he most certainly can go back to the greek people with tough reforms provided that he achieves clear concessions from the creditors. e.g., we'll impose a partial value added tax on the greek islands, etc., in exchange for forgiveness of x% of the debt and extension of payments on the rest. i.e., the kind of geniune deal that actually works in the long run that europe has been avoiding for years.

had the voters voted the other way, tsipras would have been reduced to begging for scraps from the creditors, just as his predecessors did, and then syriza would have taken to be one big joke on the greek people.


ultimately, for the euro to work, the stronger economies need to recognize that they have to, one way or another, subsidize the weaker ones. that's the way it works everywhere, including america, where stronger states effectively subsidize weaker ones. it's either that or the weak states need their own currency.

[Fred Sanders]

29. The opinion also lost me dismissing the referendum as a "huge mistake", forgetting that having

the majority of your people clearly backing you in negotiations is NOT weakening the hand.

[unblock]

36. we, i understand why the *creditors* are calling it a huge mistake...

they're obviously going to try to undermine tsipras's stronger hand.

but that's not an impartial read of the situation.

[Adrahil]

48. I think it is a mistake, insofar as....

I think many Greeks now expect the cash spigot from the government to start flowing. It's the end of austerity! Right? But the basic problem remains.... the Greek government doesn't have enough money to pay its obligations, and now, having defaulted on loans, others are reluctant to give them any more.

I think the Greek public is not going to get what they expected to get.

[unblock]

49. i don't think the greeks are expecting magic, i think they know there will be pain regardless.

but i think they're willing to accept pain that puts them on a path to a stronger economy; so far austerity has proven to be painful while only making the situation worse.

they surely understand what leaving the euro would mean -- rapid devaluation of a new drachma, wiping out a huge amount of greek wealth and savings in a matter of days. but eventually that would make greek goods and tourism dirt cheap for everyone else, and so, a boom in exports and tourism. that kind of pain is a proven remedy. austerity within a common currency is not.

[Adrahil]

53. In my experience, the public is not so nuanced in its thinking.

When people start to go hungry, they will become disillusioned.

Now, if Tsirpas actually has a PLAN to get to a sustainable economy, that could change things. Right now all I hear is "no more austerity" and "give us enough money for 3 years." I sure as hell wouldn't give them any more money based on THAT. But maybe he has something more concrete in mind.

I agree that austerity on its own is a loser. It doesn't work. it never works.

[unblock]

54. some austerity and righting of the ship has already happened, and there are other plans

he's advanced proposals. i'm not in a position to judge them, but he has put proposals out to the troika, who of course have roundly rejected them.

unfortunately, the devil's in the details, and few people are privy to those, much as we don't know what's in the tpp....

[magical thyme]

115. because the OPer predicted that the vote would be 70% yes to more austerity.

right here on DU the last week of June.

http://www.democraticunderground.com/10026923933

This OP is more accurate. There are people on DU who have no idea what's going on in Greece. I just disagree with whom he believes those people are.

[Fred Sanders]

117. 70% prediction, turning out completely wrong? That has gotta hurt!

[Rex]

121. 70% sounds about right for how wrong the OP usually is on any given topic.

Watching them daydream about being some wealthy HRC backer, is also amusing.

[LondonReign2]

146. It's his job to defend the wealthy. On that he is 100%

[underpants]

12. Good read

[Glassunion]

13. K&R

[geek tragedy]

14. what needs to happen is a managed withdrawal from the Euro

This is a bad, bad, bad, bad, bad marriage. One that should never have happened.

Greece needs to be able to manage its own currency to avoid a deflationary trap and depression from continued austerity and crippling debt loads. That means it has to have a plausible avenue to stiff its creditors the way Argentina did. then the debt negotiations can begin. The German/other demands are a permanent trap that will cripple their economy. They're in an austerity trap, and they can't get out.

And, the EU really needs to cut the shitshow in Greece loose. Another three years, and they'll be back in another round of negotiations over debt, austerity, reforms, etc. They still won't be collecting taxes properly, and the governments will still be blaming all of their problems on German bankers rather than irresponsible fiscal behavior.

[Recursion]

17. Honestly the Eurozone is a reality show at this point

"We've locked 19 countries with differing fiscal needs in a monetary union that outlaws tariffs and capital controls. Can it last 20 years? Next on Fox..."

[geek tragedy]

25. No kidding. pretty expensive show to produce nt

[joshcryer]

39. It brought us Eurovision.

[Taitertots]

80. It's times like these that I wish I knew enough about video editing to..,

Take a bunch of clips of people from the EU and make the commercial for that show.

[Recursion]

83. I'll do the voiceover

I've actually done "In a world..." trailers for Indie films...

[craigmatic]

16. I feel like somehow this is going to affect us here.

[Recursion]

22. Greek vacations will probably get really cheap.

The "Greek" yoghurt we buy is actually mostly Turkish and Israeli, so no help there.

[OnlinePoker]

42. Greece owed (as of March) the IMF 32 Billion Euros

17.68% of the outstanding IMF dollars were funded by the U.S. Based on that, the U.S. taxpayer portion of Greece's IMF debt would be 5.66 Billion Euros.

http://www.imf.org/external/np/sec/memdir/members.aspx

Of Greece's total debt (again, from March) of 323 Billion Euros, a whopping 246 Billion Euros came from the coffers of other nations. Less than 10% is owed to banks. I know if I was a taxpayer in the rest of Europe I'd be telling my politicians enough...write off the debt and let Greece go their own way. But, of course, if you did that you'd have all the other PIIGS nations expecting the same deal. I would not give Greece anymore money.

http://moneymorning.com/2015/03/25/how-much-does-greece-owe-4-charts-that-put-greek-debt-in-perspective/

[Yo_Mama]

79. We're on the hook for some of the IMF loans n/t

[Dr Hobbitstein]

18. K&R!

Great post, very informative. Thanks!

[elleng]

19. from Robert Reich

People seem to forget that the Greek debt crisis -- which is becoming a European and even possibly a world economic crisis – grew out of a deal with Goldman Sachs, engineered by Goldman’s Lloyd Blankfein. Several years ago, Blankfein and his Goldman team helped Greece hide the true extent of its debt -- and in the process almost doubled it. When the first debt deal was struck in 2001, Greece owed about 600 million euros ($793 million) more than the 2.8 billion euros it had borrowed. Goldman then cooked up an off-the-books derivative for Greece that disguised the shortfall but increased the government’s losses to 5.1 billion euros. In 2005, the deal was restructured and the 5.1 billion euro debt was locked in. After that, Goldman and the rest of Wall Street pulled the global economy to its knees – whacking Greece even harder.

Undoubtedly, Greece suffers from years of corruption and tax avoidance by its wealthy. But Goldman Sachs isn't exactly innocent. It padded its profits by catastrophically leveraging up the global economy with secret, off-balance-sheet debt deals. Did any of its executives ever go to jail? Of course not. They all got fat bonuses and promotions. Blankfein, now CEO, raked in $24 million in 2014 alone. Meanwhile, the people of Greece struggle to buy medicine and food.

Doesn't seem right, does it?

https://www.facebook.com/RBReich?fref=ts

[Rex]

27. A lot of people will ignore that post, because it is negative about teh 1% and we cannot have that.

Nevermind the fact that most people on this planet by now know the 1% nearly destroyed the global economy in 2008. Word travels fast and cannot be spun no matter how well it is tried by Wall Street.

I blame the Internets.

[hill2016]

100. yeah so

(1) What did Goldman do that was illegal (specifically under Greek or international law)? It's just like asking a lawyer to help you set up an offshore trust so you can hide assets from your creditors or your soon-to-be-divorced spouse. The lawyer only facilitated the transaction (which is perfectly legal), what you do with the vehicle is really your responsibility.

(2) The transactions that Goldman entered were interest rates or currency swaps. These can be perfectly legitimate transactions e.g. companies could want to hedge their interest rates or currency exposures. All it takes are willing counterparties on both sides.

(3) Even if you say Goldman is somehow at fault, it only earned a few hundred million euors. How does that have any relevance to the 300 - 400billion euros that Greece owes to the creditors?



I realize Goldman is not liked much but not everything it does is automatically the cause of all evil.

[hill2016]

106. why not

reply with facts and have an actual discussion?

[Rex]

116. LOL! Notice their tiny dig at Grayson?

Funny watching them sign up just to rail on Dems and use lame excuses for Wall Street.

[LondonReign2]

148. "But it was totally leeee-gal"

[jtuck004]

26. Lloyd Blankfein called, said this is a great article. Explains it perfecly. Wants his money. n/t

[abelenkpe]

85. +1000 nt

[magical thyme]

118. Nailed it!

best summary ever. wins the thread.

[LondonReign2]

150. +++

[neverforget]

155. Lol!

[joshcryer]

30. What I want to know is...

...why did the Greek government spend 90 percent of the bailout paying back the loans. They could've gone 50/50, pay loans, build infrastructure. Unless the bailout was somehow contingent on repaying those loans at such a high rate.

[geek tragedy]

38. Greece could have asked for that 50/50 deal, they wouldn't have gotten it

central bank's priority was protecting the larger Eurozone from contagion, not stimulating the Greek economy.

Just like if you sell your house, the proceeds go to your mortgage company first and then what's left go to you.

[DFW]

44. One very good reason

To foster the illusion of solvency, without which, they would have gotten cut off much earlier (when, incidentally, the debt was lower).

[retrowire]

32. knr!

I never pretended to understand what's going on in Greece but now I know quite a bit more. thanks for this!

[abelenkpe]

84. If you bought this explanation

You still don't understand the situation.

[retrowire]

86. no no no

don't get me wrong. It's not that I agree with the explanation. It's that I know more than I did before.

I think the Grecians voting No as a means to stand up to the powers that be was a good thing. It's how I feel about my student loans after all, I can empathize.

[ellennelle]

35. WHOA, HOLD ON THERE!!

i respectfully disagree with your take, but please allow some real experts on the topic 'splain it all y'all:

http://www.democracynow.org/shows/2015/7/7?autostart=true

the full hour is fascinating, but you can pick and choose the segments. richard wolf's take is pretty spot on; highly recommended.

returning to the drachma could bring some revenue by inviting tourists and traders of goods like oil and ships to spend their monty there. rough on the front end, but it will give greece a fighting chance to recover in the long run.

it's also pretty callous on germany's part, especially since a loan is a transaction, not a tyranny; both parties are involved in the risk, including the lender. this is why we have bankruptcy courts, to allow both parties to sit down and deal with the reality of what is possible for greece to do.

the austerity measure you describe as 'what needs to happen now' is what has been happening; it does not work, and will not work. it will keep greece impoverished for the foreseeable future, and beyond. in contrast, germany wants to hold on to its financial superiority at all costs, and the greeks - those dusky southerners - are expendable to them. except they need them to stay in the EU, if only to keep the rest of the austered-to-death countries (spain, portugal, italy, ireland) from asking for the same reasonable arrangement. remember, the EU banks, and Goldman, made these loans! they entered into these contracts, and yet they want to take no risk in the affair. i mean, the problems with greek tax collection and pensions have been common knowledge for decades, yet they were stupid enough to give them good money after bad? now only greece gets a haircut? mmm, not kosher. especially given these banks never really took any risk; remember how our banks were giving out home loans like candy, knowing full well they were toxic? they then bet against those 'assets' on the market, making even more money, and crashing the system in the process.

you don't even mention the rather insane but nontrivial fact that germany has the unmitigated gall to insist greece pay back all loans in full now, when germany was granted 50% debt relief, with a 30 year extension on their debt in 1953. say what you will about greece, but their crimes don't even compare to germany's in WWII.

there are so many more issues your analysis misses the boat, brooklynite, and i mean no disrespect. but i do encourage you to watch yesterday's democracynow as linked above to get a better sense of what is really going on here.

[Comrade Grumpy]

37. In order to jump start their economy, they have to go deeper into recession?

"Greece must be prepared to cut Government spending and pensions, NOT because they’re not necessary, but because they’re not affordable. Until it can find a way to jumpstart economic activity AND find a way to collect tax revenue from every social class, it will have to cut its spending accordingly."

Pensions are necessary, but cut them anyway? I suppose the Greeks can eat stray olive leaves.

[Enthusiast]

67. +1

[LondonReign2]

151. EDIT: they can eat stray olive leaves...at their salons

[Surya Gayatri]

41. Thank you, thank you Brooklynite...and a big "thanks" to your wife, too.

I wish I could recommend this X 100!

But, be advised. We've been forewarned that if we use such words as 'profligate spending' or 'spendthrift' or 'bad budget management' in connection with the GREEKS (present and past Greek administrations), we will be alerted on for 'bigotted, anti-Greek hate speech', because someone has Greek-American family members.

Watch out. The 'alert' crews are on the prowl.

[ellennelle]

47. oh good grief!!!

get a clue, will you please?

you have not even bothered to get enough facts to float an idea, and you're already paranoid victims.

sheez.

[Surya Gayatri]

50. Beg pardon? To what might you be referring?

Hardly paranoid.

I'm referring to a direct threat to alert on any post where anyone might speak of Greece's profligate borrowing and bad-budget management. You can find it if you look on the greatest page.

[Nye Bevan]

62. Don't worry. If someone alerts and it is shot down 7-0,

that person is blocked out of alerting for 24 hours. So I don't think we'll see very much of this.

[Surya Gayatri]

69. Well, that does mollify me somewhat, Nye. Thanks for the soothing message...

First, I felt threatened by a general meta-like OP that went to the greatest page, decrying "anti-Greek bigotry".

Then, in one of my OPs, the same poster personally threatened to alert if I used such language as "profligate" or "spendthrift", etc. to describe the Greek government.

They contend that that is using "bigotted, anti-Greek hate-speech" (direct quote).

Apparently, a divergence of political opinion is not to be tolerated on a political discussion board. Go figure.

[Renew Deal]

64. That wasn't the point of that post.

[Surya Gayatri]

72. But, it WAS the point of a post addressed personally to me in my OP by the same poster,

threatening to alert on words such as profligate, spendthrift, etc. when applied to the present and past Greek governments.

The poster qualified those words as "bigotted anti-Greek hate speech".

[magical thyme]

126. it's a simple problem to avoid Surya. Reply to facts with facts, not bigotry and name calling.

Here is an example:

"But 'the blacks' gladly took the money and continued with their profligate, spendthrift ways, coasting on 'government handouts'..."

Do you honestly think this quote would survive one moment here at DU? Or be alerted on and hidden in a heartbeat?

Now just replace 'the blacks' with 'the Greeks'
and 'government handouts' with 'euro-sent mana'

and we have your offensive quote, verbatim. And the rest of your quote, about how they failed to hold up their end of the Troika's demands is just plain false.
http://www.democraticunderground.com/?com=view_post&forum=1014&pid=1139764

[Surya Gayatri]

128. To conflate a sovereign nation's democratically elected government

with a historically oppressed racial minority is fatuous and absurd, not to mention insulting to the minority in question.

[magical thyme]

129. bs. Just replacing one group of people being smeared with another group of people.

I could just have easily said "the red states" or "the southerners" or "the rednecks."

Congratulations, though, on refusing to get the point.

[Surya Gayatri]

130. And, congratulations on beating your Trojan Horse

to death.

[magical thyme]

131. you raised the subject, not me.

[Saviolo]

43. An interesting take on the Greek crisis and IMF:

Here's an article from the Guardian with an interesting take.

http://www.theguardian.com/commentisfree/2015/jul/07/greece-financial-elite-democracy-liassez-faire-neoliberalism

A big problem the author refers to is "inflexible commitments to austerity."

[ellennelle]

46. was just about to add this link

thx.

the headline says it all:

GREECE IS THE LATEST BATTLEGROUND IN THE FINANCIAL ELITE'S WAR ON DEMOCRACY

sure hope brooklynite - and the minions here - read that, as well as watch the link to DN! from yesterday i've linked to above.

[WDIM]

45. I still believe Greece should default.

Central banks are just tools for the super wealthy to skim off the wealth of all of us. The Euro and the Eu should fail because it is a corrupt system put in place by greedy succubus class of the 1%.

All nations should go back to their own currency and let the pyramid scheme known as the Eu crumble away.

The drachma would have the value the greek people give it. Like all fiat currency the value is intrensic on what you can purchase with it. The greek people still need goods and services and buying goods and services would create value.

Sure they may have to go without imports but learning to live locally and within our means is a lesson needed of all humankind.

When the banks fail it may wipe out savings but it will also wipeout debt and debt is what will destroy the worlds economy. So get your savings out now because the corrupt greedy racketeering banksters are going down!

[Yo_Mama]

78. Going without imports would include going without most medicines

Also a fuel/power deficit.

You don't understand what you are recommending. It cannot be to the interest of the Greek people that suddenly all their diabetics are doomed to death and children die for lack of 40 euros worth of vaccines.

Greece is a very, very small country. Of course it has to import some things.

Yes, they can grow potatoes and raise goats. But they cannot suddenly set up factories to manufacture vaccines and basic medicines.

[dumbcat]

95. Well, if they are such a tiny insignificant country

then who would miss them?

[cwydro]

52. I sure don't.

I'm awful at economic type stuff.

So thanks for your post!

[pinto]

55. Thanks brooklynite. (nt)

[magical thyme]

56. pensions have already been cut by 44%.

You left out a few salient facts.

1. The Troika used ~90% of the loans to Greece to bail out *private banks*. The deal forced by the Troika essentially took *private* debt and turned it into *public* debt. Iow, the Greek people did not benefit from those loans.

2. In 2008, here in the US we also turned *private* bank losses into *public* debt. However, we accompanied our new crappy debt with stimulus to support the economy so we could pay off that crappy debt. We also instituted programs, like the income based student loan repayment program to enable student unable to find adequate work to live. The Troika, on the other hand, instead imposed *austerity* which crushed the Greek economy so it was unable to pay off the debt.

3. Greece has already met all of the Troika's demands. That is what crashed it's economy. It has slashed its public budget, has 25%+ unemployment, shrinking GDP (which ensures that no matter how much debt they are able to pay, it will continue to be too high relative to GDP, eg unpayable) and has cracked down on its 1% tax deadbeats.

Germany stands alone in insisting on doubling down on its failed austerity program. Back in 2010, the IMF wrote that austerity without restructuring would result in the current situation. That report was kept hidden until just the last couple weeks.

The IMF stands firm, and is joined by France, Italy and other EU countries in recognizing that the debt *must* be restructured.

[neverforget]

98. that prediction was off a little

[stevenleser]

135. So you attack him personally upthread and here you attack his wife. What do you have for an encore?

Attack his kids?

[brooklynite]

175. Actually we don't have kids...

...and we can take some insults. I do note that the people doing the attacking have ignored the fact that precisely what I said needed to happen is what Greece and the EU said needed to happen.

Facts are stubborn things...

[stevenleser]

176. I alerted on both posts and found others had previously alerted but they were upheld 4-3

by the thinnest of margins those personal attacks were allowed to stay. So I PM'ed Skinner to take a look at those posts by that person and various others of his posts. It seems all that person does is nasty attacks on people all day. There wasn't much of any other commentary at all, just attacks on you and your wife as you noted, ignoring facts.

[jeff47]

94. Anyone buying the OP's explanation needs to read your post. (nt)

[LeftOfWest]

179. That is the point of the 1%, the reason they exist, ME! ME! ME! MINE!!!

"Me! Me! Mine! Mine!"

Thank you for exposing 1% hypocrisy on these forums.

[JDPriestly]

57. I agree on this!

4. What needs to happen now?

Serious negotiating on everyone’s part, without any political posturing. Greece must be prepared to cut Government spending and pensions, NOT because they’re not necessary, but because they’re not affordable. Until it can find a way to jumpstart economic activity AND find a way to collect tax revenue from every social class, it will have to cut its spending accordingly.

Meanwhile, the EU and Greek’s creditors have to recognize that they won’t be getting full payment any time soon, and will need to either restructure the loans to cut some of the indebtedness, or reduce interest rates to a point that Greece can afford to pay them (a level that I don’t think is practical).

But I have to add that Greece needs more than just money. It needs a development plan that is fitted to its people, its climate and its location.

Greece is strategically essential to the Northern Europeans, especially the Balkans, Hungary and then the Euro countries, first and foremost among this group, the Germans themselves.

[BlueEye]

58. Excellent post, thank you!

I readily admit that Lloyd Blankfein is no Saint, and that Goldman Sachs is not the most ethical organization. Hell, they probably are evil. BUT to pin the entire Greek crisis on them is silly, and intellectually dishonest. It ignores DECADES of cultural issues, hack right-wing governments (that were democratically elected as far as I can tell), reckless spending, and widespread tax evasion. No wonder they're bankrupt.

They should gently exit the EU and make their way to the Drachma, press the reset button.

[Taitertots]

60. 4. Greece needs to leave the euro and default on all their foreign debt

This is psuedo-economic garbage. Austerity will only cause more economic contraction and worsen their debt position. It simply can't be a solution because it doesn't improve their situation.

[hill2016]

105. would you feel the same way

if your pension plan or 401k plan invested in Greek government bonds?

[Nye Bevan]

65. Would a better referendum question have been as follows?

Should Greece:

1. Keep the Euro as its currency and take the best deal on offer fron the Troika;

or

2. Exit the Euro and return to the Drachma, unilaterally restructuring its debts?

[mckara]

66. You Make It Sound Like the ECB, EC, and the IMF are Honest Brokers

who haven't been violating the original treaty by cutting off funding to Greek banks, while sending money to stabilize Bulgaria, who is not even in the European Union. Yes, yes, yes neoliberal sycophants can find ways to justify transforming an economic policy into a political manifesto designed to destabilize democratic institutions and privatize public lands and landmarks.
The Drachma's value would plummet, if Greece moved away from the Euro, but we only have to look at Iceland, after the financial collapse in 2008, how countries quickly become more competitive and their recoveries are far quicker than accepting blackmail terms from financial terrorists in the ECB, EC, and the IMF, who are spreading out the pain for decades with austerity to subjugate Greece under their thumbs. Financial instruments are effectively weapons of economic destruction that make weaker economies in Europe colonies of the larger economic powers. Angela Merkel's Fourth Reich is doing what Adolph Hitler's Third Reich did without firing a shot!
In other words, I reject the entire premise of your argument and suggest you read the economic history of the West from World War I to the present before trying to convince people you know how to make a compelling argument.

[EEO]

68. It really is a colossal mess.

Greece never should have joined the eurozone, but that is moot at this point. No easy answers.

And Greece cannot just keep cutting or it will find itself in the same place it is today before too long. Austerity does nothing to stimulate an economy, and does much to harm one.


There's always this solution: Greece Challenges Merkel to Russian Roulette to Solve Debt Crisis

[markpkessinger]

71. Sorry, no. There is fault aplenty to go around . . .

And yes, a debt reduction puts the European Central Bank in a difficult spot vis-a-vis other southern European countries. (That's the problem with having a unified currency absent fiscal or political unity.) But Greece has already borne massive cuts in government services and reduction in wage and pension payments, and an unemployment rate of 25%. The public sector, prior to the crisis, constituted 40% of the Greek economy, and the austerity measures to date have served to further contract Greece's economy. The notion that it is in any way reasonable to expect the people of Greece to pay still more for their previous leaders' sins than they already have is positively delusional, as is the idea that further austerity will serve any purpose whatsoever other than to further cripple Greece's ability to pay at all.

And Merkel, for her part, has complicated her own position by peddling an outrageous narrative of "hard-working Germans" who have been "carrying lazy Greeks." And the German people (never known to be reluctant about believing in their own superiority, be it ethnic or moral) have bought into it. Thus Merkel has placed herself in an impossible position with her own voters, who will be self-righteously furious if she cuts any kind of reasonable deal. And, As Richard Wolff pointed out in his Democracy Now interview, this narrative is very much reminiscent of Romney's infamous "47%" remarks. Only I would argue it is actually much worse than that, because it sets up competing nationalisms.

Merkel is playing with fire here. No, make that volatile explosives. Syriza's recent electoral success notwithstanding, there remains a hard line fascist element in Greece, and in other countries as well. Wolff points out that it is no coincidence that Marie LePen, leader of the far right Front National in France, has announced her solidarity with Greece's left-wing party, Syriza. Why? Because she sees what is coming: a major cross-national class conflict in the form of a virulent anti-capitalist backlash, and thus she is positioning her far-right party to be able to swoop in and exploit the crisis.

If any country should understand the dangers of pushing a people to the finical breaking point, it should be Germany, whose own history vividly illustrates the dangers. Merkel and the German bankers need to pull their heads out of their asses and begin to understand the stakes here.

[hill2016]

104. by your argument

should the US repudiate its debt whenever a different administration comes into power?

How do you prevent countries from repudiating their debt whenever they change government?

[markpkessinger]

109. Of course not . . .

. . . but then, given that the U.S. has the benefit of a sovereign currency, and that the vast majority of our debt is owed to ourselves, we are not likely to find ourselves in the same situation in which Greece finds itself. Because Greece's debt is primarily external, and because it is not a debt held in Greece's own currency, but is instead tied up in an inflexible, multi-national euro, Greece (and other similarly situated countries in the Euro zone) is deprived of any of the tools it would normally have at its disposal to deal with such debt. (That's why I made reference to the problem of a unified currency absent fiscal and political unity.)

Look, the concept of debt forgiveness or debt write-downs is nearly as old as the concept of debt itself. Indeed, that's precisely what business bankruptcy is. When a business gets in over its head, the courts intervene between the business and its creditors and come to a solution that restructures, and in some cases, writes down existing debt to a level that allows it to reorganize and work its way out of its over-extended situation. And generally, the business's creditors will wind up getting paid back more than they would have if they had simply kept on insisting the business meet the full amount of all of its debts to all creditors, which would simply force the business to close, and would result in the creditors being forced to accept whatever share of the business's assets a court chose to grant them.

Of course, the most glaring irony in all of this is that in the early 1950s, Germany itself, reeling under the weight of debt from two world wars and in the midst of trying to rebuild, asked for, AND RECEIVED, a forgiveness of approximately 50% of its massive debt (some of it owed to Greece). Indeed, that settlement was forced upon Greece and other countries by the U.S.

So you see, this isn't just "my theory," nor is it some novel concept. And history bears me out when I point out that a nation simply cannot be forced to repay debt to the point that its citizens are driven to being unable to feed, clothe and shelter themselves. No people will stand for it.

[Doctor_J]

73. does anyone remember when du became overrun with posts that could have come

Directly from the wall street journal?

I swear it used to have a mostly progressive, pro working class, and anti corporate elite slant.

[Nye Bevan]

74. Should working-class Germans pay taxes to subsidize working-class Greeks?

See, the problem with the Greek situation is that it is not a clear case of ruling class versus working class or the 1% versus the 99%.

[Fumesucker]

91. Should working-class New Yorkers pay taxes to subsidize working-class Kansans?

Because they do, year after year, decade after decade.

[Nye Bevan]

96. Yep. And in a federalized Europe, this would not be an issue.

The problem is when you have separate political entities sharing a common currency.

[Spitfire of ATJ]

76. I suppose they should hang on to those subs though,...right?

[calimary]

82. Hey brooklynite - thanks for this!

Please thank your wife for her expertise.

You're correct - I'm certainly one who doesn't understand much of what is going on in Greece. I had to look up "Grexit" because I see it pop up in these discussions and had no idea what it meant. It's a combination of "Greek" and "exit".

[MineralMan]

89. That doesn't mean they shouldn't proclaim their opinions.

It doesn't affect them, see. Their ATM cards are still working, after all.

[jeff47]

92. You're missing something in your "blame" section.

A very significant chunk of the debt came from bailing out private, mostly non-Greek banks. So the EU/IMF makes a loan to Greece, and Greece turns around and gives the money to a French or German bank because of the bad loans that bank made on Greek vacation homes - they had a housing bubble like Florida. Why'd Greece do this? It was a condition of getting the loans to handle its other debt.

Like the US, they nationalized the bad debt instead of telling the banks "Well, you fucked up. Enjoy your losses".

Also, your "What needs to happen now" ignores that the EU central bank is running the EU economy for Germany's benefit. Some inflation in Germany would do all of the "crisis" countries a hell of a lot of good. Inflation is far less economically destructive than deflation.

[hill2016]

101. did you know

that the private sector took a writedown of about 75% of its Greek debt?

Guess not.

[jeff47]

114. Did you know that isn't actually true?

Some private debt was written down. A much larger percentage wasn't.

But that gets in the way of the story of irresponsible Greeks throwing money everywhere, and poor bankers being their victims.

[stevenleser]

134. Actually, it is true. 90% of private debt contributed to the writedown.

http://money.cnn.com/2012/03/09/markets/greece-creditors-default/

"NEW YORK (CNNMoney) -- Greece announced Friday that its private-sector creditors will take part in a historic restructuring of the government's debt, setting the stage for the nation to secure more bail-out money and skirt a messy default.
Investors agreed to restructure €172 billion worth of Greek bonds, which represents 85.5% of the total €206 billion held by the private sector, according to the Greek finance ministry. Another 69% of investors who own Greek bonds not issued under Greek law agreed to restructure roughly €20 billion.
.
.
.
Activating the clauses brings the total participation rate to more than 90%, the threshold Greece needs to cross in order to meet all the conditions of its second €130 billion bailout from the European Union and International Monetary Fund."

[jeff47]

152. That was after the Greeks had nationalized much of the debt. (nt)

[hill2016]

182. I thought

the money was lent to the Greek government in the first place?

[jeff47]

186. It was. And then a large part of it was paid to private banks.

Let's say I've made a bad loan. You borrow money, and then send it to me to pay off the loan. Now I no longer have a bad loan, and you have debt.

Same deal with Greece. The Greek government borrowed money. One of the conditions of the loan was to pay off bad loans made by non-Greek banks. That nationalizes the bad debt.

[hill2016]

187. sorry

do you mean bad loans made by non-Greek banks to the private Greek sector?

[jeff47]

188. Yes. Greece had a housing bubble similar to Florida.

But Florida got lots of economic stimulus and support due to federal programs. Medicare and Social Security checks kept coming, the FDIC kept the banks solvent, the Fed kept money flowing to Florida banks, and so on.

The structure of the EU means that doesn't happen automatically, as it does with the US and Florida.

[GliderGuider]

145. Sorry, this should have gone on the OP

Last edited Thu Jul 9, 2015, 06:45 PM - Edit history (1)

[Liberal_in_LA]

93. rec.. it is complicated. thx for summary

[frazzled]

103. I heard something on Charlie Rose from an American correspondent in Greece

the other night. He was saying that the Greek government has told the EU that it wants to comply with their budgetary demands by raising taxes on businesses, but the EU has rejected this, saying they need to cut spending instead (as if that had been working—not). Their claim is that the country is overtaxed already.

I found this astonishing. Perhaps the question is more complex than I am able to understand, but I don't see how Europe can demand the means by which the Greeks address their crisis, just the outcomes. If they want to raise taxes to accomplish the necessary capital demands on the budget, isn't that their sovereign right?

[Hoyt]

108. If Greece decides to go on its own, they better beg to get in on theTPP.

[magical thyme]

127. Seriously? Move Greece from the Mediterranean and Aegean

to the Pacific?

Yeah, that oughtta do it...

[Hoyt]

132. Knew some folks wouldn't get it.

[magical thyme]

153. care to explain how or why Greece should try to join the Trans Pacific Partnership?

[Hoyt]

154. Because they need to be in every trade agreement they can get into. I don't think

the agreement actually requires, by some law of nature, that a country touch the Pacific Ocean. In fact, the TPP started as an Asian Pack. But, read everything literally with a closed mind.

[magical thyme]

156. well if you had a clue you might have suggested they try to join TTIP

or you could just keep digging, but hey, whatever.

All current TPP members are members of the Asia Pacific Economic Cooperation (APEC) Forum,1 a grouping of countries that includes Australia, Canada, Chile, China, Indonesia, Japan, Mexico, Peru, and the United States. Indeed, APEC membership has been an unofficial requirement for entry; TPP countries see their prospective accord as a key pathway toward APEC’s long-standing goal to create a Free Trade Area of the Asia Pacific (FTAAP).

While TPP is designed to broaden and deepen trade and investment ties in the region, it has not pulled in all countries with FTAs.

http://www.americasquarterly.org/next-big-thing-trans-pacific-partnership

[Hoyt]

161. Greece needs the one that is closest to being finalized, if you had a clue.

[magical thyme]

165. they're not a member of the Asia Pacific Economic Cooperative, and never will be

It is an ASIA PACIFIC deal, period. It doesn't matter if all countries sign it today. They can't join.

[Hoyt]

167. Look, my point was Greece needs as many damn trade deals as they can get. No more living off

Loans, as they have been doing.

Read in chunks, rather than reading one word at a time, while pointing with your finger.

[magical thyme]

172. I gave you an obvious way out. you could have just said "the ttip instead of tpp"

but you just kept on digging. pretty much what everybody has learned to expect.

Now that you've moved on to "well they need every trade deal they can get," they're already a member of the European Union, which makes them eligible for the TTIP.

They signed a deal with Russia for a gas pipeline that is potentially worth hundreds of millions of something annually.

China is interested in having a port there, so they have potential for a major deal there.

[brooklynite]

159. I don't think that's the problem...

...the problem is that they don't have anything to trade. Their potential exports are very limited.

[Hoyt]

162. They could use some investment from foreign companies, but who is going to go there unless

there is a good dispute mechanism (like the ISDS), that so many are against because they say corporations can change a country's law). It's BS and won't happen, but sounds like Greece could use some changes.

[MFrohike]

110. What?

You're missing a few things and you're wrong about others.

1. No mention of the housing bubble. That's kind of important because it's the entire reason the first bailout was done..

2. While you're right about facing harder terms, I'd have called the referendum a sham. I'd also have mentioned that the Greeks brought a proposal at the end of June that crossed their red lines and the EC told them to go further.

3. Yeah, you're totally confused. Greece's debt is almost entirely held by sovereign entities. The Greek banks are failing because of a bank run that started in November, not loans to the state. The ECB has stated they'll cut off ELA if there's no deal by Sunday. That alone is an indication that we're talking about banks being unable to keep up a sufficient amount of money for withdrawals, not a loan problem

You're also confused on the issue of the sovereign debt and the IMF. Greece is already in default to the IMF. Lagarde made the report on July 1 to her board. The default date for the ECB is July 20. You are mostly correct about a reversion to the drachma. Your comparison of a small nation that gets a lot of tourism is really odd because Greece IS a small nation that gets almost 20% of its GDP from tourism. That's not really a good example of why continuing to use the euro would be bad.

Your inflation argument is not only wrong, but bizarre. You do know that the stated policy of Mario Draghi is to increase inflation, right? Europe's in a deflationary cycle because they're depressing demand through moronic fiscal and monetary policies. Inflation is a measure of supply-side failures, not the old goldbug bullshit about money printing. Well, I should say hyperinflation, but that's really what you meant anyway.

4. Greece has already had maturity extensions and interest rate cuts that have dropped the real value of its debt to about 70% of GDP. While more would help, that won't reverse the deflationary cycle by itself. The only thing that will do that is spending. What needs to happen in Europe is a rejection of the Maastricht Treaty, a central fiscal authority to route money to depressed areas (think of our automatic stabilizers), and Germany's trade surplus with Europe needs to disappear, preferably through German investment in productive businesses in its in fellow European trade partners. Do that and Europe will probably heal.

[hill2016]

111. well

1. How did the housing bubble contribute to the first bailout?
2. The creditors have their own red lines (like no forgiveness of debt). If both sides don't see eye-to-eye on what needs to be done, there's no deal. Like what's happening today.
3. Greece banks are failing because they are insolvent because their assets (Greek government bonds and NPL) have been severely impaired. So it's both a liquidity and solvency crisis. Under the ECB's rules it is not allowed to extend ELA to insolvent banks (which Greek banks are).

You also mentioned the Maastricht treaty which bans monetary financing of government deficits. Technically yeah the ECB could buy up as much government bonds as Greece issues but there's no political cover to do so.

4. The only way a central fiscal authority could ever be considered would be if there's a true federal government (over budgetary and by extension almost all important state matters) to which European states cede their sovereignty. Think any country would ever go for that?

[MFrohike]

171. Answers

1. The first bailout was a money laundering operation. The money passed through Greece to French and German banks to cover the losses they took by reckless lending on overvalued Greek property. 91% of that money went to those banks.

2. And? I didn't bring up the issues involving the creditors. I pointed out that Tsipras brought a severe austerity budget to them at the end of June, giving them everything they wanted, and they wanted more. I didn't make a moral argument, I stated a fact.

3. True. It still doesn't change the fact the original assessment of those assets was wrong.

Maastricht is bad policy. Leaving aside the fact that it's always been hypocritically enforced, much like the CAP is distributed, it's a treaty dedicated to crushing debtors. It's a hard money pact suited to assuaging misguided German monetary morality. Hard money is only virtuous if you're stupid or wealthy.

4. I think the Eurozone and the EU itself are doomed if they don't. Its current structure is set up to maximize dysfunction while removing effective channels of change. I suspect a few countries would go for it, but the real issue that Germany will not. They would prefer to dominate the EU without actually being responsible for its success (I could say that about others, but Germany is the one who actually does dominate). That won't last long without resorting to force, which I doubt Europe could effectively do these days anyway.

[bhikkhu]

112. Regarding the consequences of #3, going back to the drachma

where it would almost inevitably drop in value versus the Euro - that sort of thing has happened in many other countries that hit bottom financially. It often plays out to render that country's assets a very good buy for foreign investors who are able to purchase property and assets there for cheap. Greece would be a great discount travel area, lots of vacation home potential, lots of business potential, and foreign money would easily outbid local money. The downside would be that Greece would be more strongly and permanently under foreign ownership, and opportunities for the people themselves might be limited to service sector roles.

[freshwest]

119. Thank you for answering these questions! Miserable state of affairs for all. n/t

[magical thyme]

120. You mean that 70% were going to vote Yes to Moar Austerity Please?

You, and your Greek friends, are viewing the problems in Greece from the 1% ivory tower. You have *no* idea what really caused the problems, how the Troika continues to make things worse, or how to fix it.


http://www.democraticunderground.com/?com=view_post&forum=1002&pid=6953794

[Rex]

125. Nobody here buys anything the OP is selling.

The OP loves to pretend to be someone of importance then destroys that illusion with their own words. It is a funny thing to watch.

[brooklynite]

157. Observation 1: You chose to attack me rather than my analysis

Observation 2: The Greek Government is calling for significant austerity cuts and the EU President is calling for a debt write-off.

Which of us got it right?

[magical thyme]

163. Both cuts to austerity and a debt write-off are required.

In the past week or two -- ever since the release of the 2010 IMF report that stated the program would fail without debt-writeoff -- everybody except Germany has been calling for the debt-write off.

It's what Varoufakis has been requesting since Syriza took office.

Varoufakis pushed the issue until the IMF "went rogue" and released it's 2010 report supporting his position.

That is when everybody except Germany understood why he was making that demand.

Varoufakis left, not because he is a "coward" or "rat" (as some DUers foolishly claimed), but because getting the buried truth out in the open required a nuclear response.

He made himself a lightning rod, then left to clear the air so the Troika can suddenly offer a debt write-off while saving face.

[LeftOfWest]

180. NOBODY buys it. Thank you.

[brooklynite]

158. Apparently then, neither does the Greek Government

The Greek government capitulated on Thursday to demands from its creditors for severe austerity measures in return for a modest debt write-off, raising hopes that a rescue deal could be signed at an emergency meeting of EU leaders on Sunday.

Athens is understood to have put forward a package of reforms and public spending cuts worth €13bn (£9.3bn) to secure a third bailout from creditors that could raise $50bn and allow it to stay inside the currency union.

http://www.theguardian.com/business/2015/jul/09/greece-debt-crisis-athens-accepts-harsh-austerity-as-bailout-deal-nears

[magical thyme]

160. neither does the Troika...what?

They proposed austerity with *debt relief* in exchange for bridge loans. The debt-writedown is what has been missing from the Troika's offers, and what Merkel refused.

Donald Tusk, who chairs the EU summits, said European officials would make an effort to address Greece’s key request for a debt write-off.

“The realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors. Only then will we have a win-win situation,” Tusk said.

[Rex]

164. Oh how sad, the OP says I attack them when I just point out the obvious everyone else notices.

I guess living so high above us little people has affected the oxygen level going to the OPs brain. Oh well, at least they have been called on their bullshit and been owned by almost everyone in this thread.

Funny watching the OP flail around for the creditors. Pathetic and funny.

[brooklynite]

170. Perhaps instead of insulting me...

you should be explaining to the Greek Government why you know what to do better than they do?

[whatchamacallit]

137. Why is everyone thanking your wife?

[brooklynite]

142. She's the tax/finance expert who explained a lot of the details to me

[whatchamacallit]

147. Dig. I just reread your post

and saw the attribution.

[Rex]

166. No idea, I guess people will just about believe anything they read on the Internets.

[Blue_Tires]

138. kick...

concise, well-thought analysis...

[fadedrose]

143. We bailed out the crooks from Wall Street who caused our recession

and nobody went to jail. And we've almost come back. I understand that some will be charged, heavily fined, Chase, Citibank, and a couple others.

Seems that this is a problem that we should offer to send Sen. Warren over to help...her expertise wouldn't hurt. She's got no dog in this fight, so it would definitely be an unbiased bit of advice.

[CK_John]

149. The people and government of Greece have no idea whats going on.

[GliderGuider]

169. -1

for the bankster talking points...

[Nye Bevan]

173. Yep, if only they would arrest Lloyd Blankfein,

tell the IMF to fuck off, and, er, arrest Lloyd Blankfein again, their problems would be solved. Probably.

[architect359]

177. Thanks for the information

'preciate it!