The article begins by posing a question framed around false assumptions and then proceeds as if those assumptions were in pursuit of legitimate conclusions. "How much of Alexis Tsipras’s tactics in the past five months have been driven by incompetence and how much by conspiracy?" is asked by the Journal's author.
The article concedes, "The Greek Prime Minister said in a televised statement that those accusing him of having a deliberate plan to take Greece out of the eurozone were telling lies."
The article then continues with an explanation of his deliberate plan to take Greece out of the eurozone. According to the Jounral's interpretation, "which meant he had no choice but to go through the motions of negotiating with Greece’s creditors for as along as they were willing to indulge him."
By "go through the motions of" the article implies he was deceiving the world and hiding his "plan". The creditors had better 'indulge' him as this is very serious business and his position cannot be taken lightly, as seems to be the Journal's attitude.
But, dishonesty comes from outside of Greece with fictional exchange rates being one source of the lies and deception.
"US bankers devised a special kind of swap with fictional exchange rates. That enabled Greece to receive a far higher sum than the actual euro market value of 10 billion dollars or yen. In that way Goldman Sachs secretly arranged additional credit of up to $1 billion for the Greeks. This credit disguised as a swap didn't show up in the Greek debt statistics. Eurostat's reporting rules don't comprehensively record transactions involving financial derivatives." (source)
"The truth of the matter is that Greece is not in desperate need of money. Greece needs to stop bleeding by spending more billions towards the servicing of an unsustainable debt.
The funds to be released — if a bailout agreement is reached — will not go toward the Greek economy. They will be chiefly directed toward the refinancing of the Greek debt. This effectively means that those in desperate need of a bailout are the European taxpayers who will otherwise lose dozens of billions. Yet, the myth of Greece as the beneficiary of an influx of money is so well entrenched that most would be shocked to realise that since 2013 Greece has not received a single euro or that roughly 90 per cent of the so-called “bailout” money went directly to banks that had made toxic investments by buying Greek debt.
Once we gain a better grasp of the true nature of the “aid”, it can become clearer why EU — and especially German — politicians so vehemently invest in a rhetoric about continued “aid” toward Greece. If Greece defaults, the true nature of all the aid toward Greece will be unmasked. It will be increasingly evident that the only beneficiaries were financial institutions that were “protected” from suffering the consequences of their risk-taking activities — once European taxpayers were forced to “rescue” Greece. (source)
The Journal article claims "he submitted proposals that never stood any chance of being accepted, but which have allowed him to claim it was the creditors who were being unreasonable..."
Perhaps there was little chance of the proposals being accepted by the creditors whose demands are, in fact, 'unreasonable' !!!
A string of academic reports documenting in detail the impacts of austerity on health care and health outcomes in Greece have recently been released. They show how European authorities, IMF and Greek government policies implemented in response to the economic crisis have led to deaths and attacks on the health of ordinary people. But there was nothing inevitable about those consequences...
But it is not as if the Greek government was trying to resist troika pressure - it is also pro-austerity. (The troika: the European Commission (EC), the International Monetary Fund (IMF) and the ECB, European Central Bank.)
Varoufakis wrote recently that "the government is not interested in the slightest in playing tough with the troika," but "only with its own people, trying to impress the troika with its ruthlessness." For example, in 2012, Greece went beyond the troika's demands for spending reductions in pharmaceutical expenditures and hospital operating costs. The then-minister of health, Andreas Loverdos, conceded that "the Greek public administration . . . uses butchers' knives" to cut spending. The Lancet described the government's attitude to the multiple health problems for which it is responsible as one of "denial."
An important problem is the erosion of health-care coverage, which in Greece is linked to employment. Because unemployment has surged over the last few years and stands at 28 percent today, there are now about 800,000 people who are without unemployment benefits and health coverage.
As if this was not enough, stillbirths rose by 21 percent between 2008 and 2011 because of scaled down prenatal health services for pregnant women, while the long-term fall in infant mortality has been reversed, surging by 43 percent between 2008 and 2010.
The general deterioration of social life due to austerity is clear when the following statistics are considered. There are 2.8 million households in Greece, and 2.3 million have a debt to the Tax Office that they cannot service; 1 million households cannot pay their electricity bill in full; households' disposable income has contracted 30 percent since 2010; the minimum wage has been reduced by 40 percent; social transfers have been cut by 18 percent; there are now 3.5 million employed people who support 4.7 million unemployed or inactive ones; and 35 percent of the population live at risk of poverty or social exclusion.
No wonder that deaths by suicide have thus increased by 45 percent between 2007 and 2011. (source)
Here's the truth: Greece would face an unsustainable level of debt by 2030 even if it signs up to the full package of tax and spending reforms demanded of it, according to unpublished documents compiled by its three main creditors.
The documents, drawn up by the so-called troika of lenders, support Greece’s argument that it needs substantial debt relief for a lasting economic recovery. They show that, even after 15 years of sustained strong growth, the country would face a level of debt that the International Monetary Fund deems unsustainable.
The documents show that the IMF’s baseline estimate – the most likely outcome – is that Greece’s debt would still be 118% of GDP in 2030, even if it signs up to the package of tax and spending reforms demanded. That is well above the 110% the IMF regards as sustainable given Greece’s debt profile, a level set in 2012. The country’s debt level is currently 175% and likely to go higher because of its recent slide back into recession.
The documents admit that under the baseline scenario “significant concessions” are necessary to improve Greece’s chances of ridding itself permanently of its debt financing woes.
Even under the best case scenario, which includes growth of 4% a year for the next five years, Greece’s debt levels will drop to only 124%, by 2022. The best case also anticipates €15bn (£10bn) in proceeds from privatisations, five times the estimate in the most likely scenario.
But under all the scenarios, which all assume a third bailout programme, looked at by the troika – the European commission, the European Central Bank and the IMF – Greece has no chance of meeting the target of reducing its debt to “well below 110% of GDP by 2022” set by the Eurogroup of finance ministers in November 2012.
In the creditors own words: “It is clear that the policy slippages and uncertainties of the last months have made the achievement of the 2012 targets impossible under any scenario”.
These projections are from the report Preliminary Debt Sustainability Analysis for Greece, one of six documents that are part of the full set of materials that comprise the “final” proposal sent to Greece by its creditors last Friday.
The creditors’ proposals also suggested that corporation tax rise only from 26% to 28%. Greece wanted the rate set at 29%. (source)
Certainly the Journal is aware of these facts, but criticizes the Greek leadership inspite of the facts. Another set of facts ignored by the Journal article has to do with the reason for large portions of the Greek 'debt'.
the greek government made massive weapons purchases from Germany, France, and the USA -- 15 percent of Germany's ares exports are to Greece (largest european market-- "If there is one country that has benefited from the huge amounts Greece spends on defence it is Germany," said Dimitris Papadimoulis, an MP with the Coalition of the Radical Left party.
"Greece has paid over €2bn (£1.6bn) for submarines that proved to be faulty and which it doesn't even need.
"It owes another €1bn as part of the deal. That's three times the amount Athens was asked to make in additional pension cuts to secure its latest EU aid package."
From 2002 to 2006, Greece was the world's fourth biggest importer of conventional weapons. It is now the 10th.
No other area has contributed as heavily to the country's debt mountain. If Athens had cut defence spending to levels similar to other EU states over the past decade, economists claim it would have saved around €150bn – more than its last bailout.
Referring to the Greek position in negotiations, the Journal article continues it's assult, "No policy maker anywhere else in the eurozone thinks this is true. The relationship between Mr. Tsipras and other eurozone leaders has broken down so irretrievably that it is hard to see how they can possibly agree on new loans for Greece while he remains in power..."
The Journal is complicit in a conspiricy driven by the need for 'regime change'. They are pushing for a Greek leader, another puppet, who will submit to the financial markets regardless of the effect on the people. That's the 'real' problem with current leadership, that they are attempting to stand with the people of their own nation rather than assimilate into the elite of the eurozone.
The Journal article degrades itself with name-calling and insults... "the inscrutable Mr. Tsipras"...
Even now, most eurozone policy makers are willing to believe that Mr. Tsipras has blundered into his current position as a result of inexperience and incompetence rather than as a result of a secret mission to take Greece out of the euro.
If he sincerely thought that the eurozone would extend the bailout deal for an extra week to allow Syriza to campaign against it, then he really was naive.
Mr. Varoufakis formally requested the eurozone start talks on a third bailout program—yet somehow failed to provide a promised letter detailing what reform commitments Greece was ready to make in return. When the letter duly arrived on Wednesday, it turned out to fall far short of the expected capitulation.
Besides, many Eurogroup ministers made clear to Mr. Varoufakis that there could be no discussion of a new bailout program until Athens either canceled the referendum or agreed to campaign for a “Yes” vote. Instead, Mr. Tsipras took to the airwaves on Wednesday to reiterate his call for a “No” vote.
Since Syriza and other antibailout parties dominate the current parliament, new elections would then be needed which would take up vital time and which could return him to power. (Journal Article)
The EU elites themselves have run their currency experiment into the ground by imposing synchronized monetary, fiscal, and banking contraction on the southern half of EMU, in defiance of known economic science and the lessons of the 1930s. It is they who pushed the eurozone into deflation, and thereby pushed the debtor states further into compound-interest traps.
It is they who deployed the EMU policy machinery to uphold the interests of creditors, refusing to acknowledge that the root cause of Europe's crisis was a flood excess capital flows into vulnerable economies. It is they who prevented a US-style recovery from the financial crisis, and they should not be surprised that such historic errors are coming back to haunt.
The revolt in Italy has different contours but is just as dangerous for Brussels. Italians may not wish to leave the euro but political consent for the project but broken down. All three opposition parties are now anti-euro in one way or another. Beppe Grillo's Five Star movement - with 108 seats in parliament - is openly calling for a return to the lira.
Mr Grillo proclaims that Syriza is carrying the torch for all the long-suffering peoples of southern Europe, as it is in a sense.
"What’s happening to Greece today, will be happening to Italy tomorrow. Sooner or later, default is coming," he said.
The leaders of Spain and Italy know that their own populists at home will seize on any concessions to Syriza over austerity or debt relief as proof that Brussels yields only to defiance. They have a very strong incentive to make Greece suffer, even if it means a cataclysmic rupture and a Greek ejection from the euro.
It would throw the Balkans into turmoil and probably shatter the security structure of the Eastern Mediterranean. It is easy to imagine a chain of events where an embittered Greece pulled out of Nato and turned to Russia, paralysing EU foreign policy in a self-feeding cycle of animosity that would ultimately force Greece out of the union altogether.
The charisma of the EU - using the Greek meaning - would drain away if such traumatic events were allowed to unfold, and all because a country of 11m people wanted to cut its primary budget surplus to 1.5pc from 4.5pc of GDP, and shake a discredited Troika off its back, for that is what it comes down to. (source)