I may not understand why Alexis Tsipras, the head of the left-wing Syriza Party in Greece, is making public appearances in Paris with less than a month before the revote in his own country. But I do understand his straight-talk strategy here, calling the bluff of EU leaders on whether they will “force” Greece out of the Eurozone in the event of a Syriza victory on June 17.
Alexis Tsipras, the radical left Greek leader, has arrived in Paris to warn EU countries that their turn would come if they failed to oppose the radical austerity that is driving Greece to the brink of “collective suicide” [...]
“Greece is a link in a chain. If it breaks it is not just the link that is broken but the whole chain. What people have to understand is that the Greek crisis concerns not just Greece but all European people so a common European solution has to be found,” he told a press conference in Paris.
“The public debt crisis is hitting the south of Europe but it will soon hit central Europe. People have to realise that their own country could be threatened.
“We are here to explain to people in Europe that we have nothing against them. We are fighting the battle in Greece not just for the Greek people but for people in France, Germany and all European countries.”
“I am not here to blackmail, I am here to mobilise,” he said.
There are two motives here. One is to gather solidarity among the other non-German countries in Europe. But the subtext is to call Germany’s bluff. Tsipras is basically saying that a Greek exit from the euro will cause destabilization across other Eurozone countries, and the implication is a dissolution of the monetary union entirely. He is speaking the language of contagion, suggesting that he knows well why Germany won’t even allow Greece to leave the euro. Indeed, there’s a wide swath of unanimity on that point. The G8 leaders just delivered a communique vowing to keep Greece in the monetary union. Even Syriza has said they want to stay; they just want to renegotiate the bailout contract and remove future austerity measures.
Basically we’re seeing a big game of chicken. It’s one thing if Germany knows that the left wing in Greece is bluffing; it’s quite another if the situations are reversed. Tsipras clearly feels he can make certain demands, secure in the knowledge that Germany and especially the European Central Bank cannot afford to cut his country loose (through “bank jogs” in the peripheral countries, a massive amount of risk has been loaded onto the ECB balance sheet, which they would be responsible for in the event of a Eurozone breakup).
Now, it looks as though Syriza’s lead in the Greek polls has softened a bit, suggesting that Tsipras might want to get himself back to Greece rather than partaking in a grand European tour (Berlin is next!). Of course, even the legacy parties in Greece have taken up Syriza’s call for the bailout agreement to be renegotiated. And Germany simply has more to lose than Greece, a country which has already lost almost everything, after all.
At a guess, Greece has considerably more bargaining leverage than it might seem to at first. One useful index of bargaining strength is relative levels of sensitivity to breakdown/catastrophe/failure to reach a deal. It’s plausible that Greece is relatively indifferent to breakdown at this point – years of grinding austerity inside EMU seem barely preferable to the costs of exiting the euro. In contrast, Germany could see the collapse of the euro (and consequent very serious economic costs) if a Greek exit leads to the collapse of confidence in Spanish, Irish, and worst of all, Italian banks. If I were to lay a bet on which side is likely to fold first, I’d be putting my money on the Germans.
The short version of this is that Greek consequences of a Eurozone exit are fairly predictable (short-term suffering, which they’re already experiencing, and devaluation offering a bit of long-term hope), while the consequences for the rest of Europe are largely unpredictable. So that makes it harder for Germany to pull the trigger.
Another good overview, including Tsipras’ commendable views on issues other than austerity and the bailout, comes from Matt Stoller. As he writes, it’s important to keep in mind that a “bailout” of Greece just uses the sovereign as a pass-through to bail out French and German banks. That’s the untold story here. To close, let me quote Tsipras: “The war we are fighting in Europe is not between people or nations, it is between the forces of work and the invisible forces of finance and banks.




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If I recall correctly Paris has a splendid guillotine museum.
Be careful about the polls David. The first one to show New Democracy ahead was commissioned by Alpha TV, which is a subsidiary of the German corporate giant Bertelsmann, whose interests in this fight are obvious. The polls are now part of an intense campaign to defeat the left. Remember that these folks have been fixing elections in Europe since 1947. Tsipras is right where he should be, trying to build some protection in numbers and geography. This is a vicious, take-no-prisoners fight, make no mistake about that.
Tsipras’ quote at the end of this piece is perfect.
Thank you for the update from the Eurozone, David. Lord knows we can’t get it from the MSM.
It may also be that the G8 comments on retaining Greece in the eurozone and vague mumbles on lightening up on the austerity are meant to muddy the waters of the Greek election. I can imagine they don’t want to see Tsipras win. In terms of his campaign, my read is he wants to show he’s ready for the big time. Who knows?
What’s the CIA doing to defeat Tsipras?
No museum but an exhibit at Musée D’Orsay. I’m not sure if it’s still there but it opened to some controversy in early 2010.
Probably planning a drone strike
Good guess.
And when they do, it is incredibly inaccurate. William K. Black has taken the traditional MSM to the woodshed, especially the NYT: http://www.benzinga.com/personal-finance/financial-advisors/12/05/2603045/will-the-new-york-times-reporters-ever-admit-that-
Remember at the end of the day Greece should never have been admitted to the EU according to their (The EU) own rules. Greece was never solvent enought to be admitted but thanks to the clever shenanigans of….wait for it GOLDMAN SACKS they cooked the books for Greece and Voila..Into the EU they went. There were certain criteria that were required for admitance to the EU and to the Euro as a new contries currency. Goldman Sacks hid the bad news for Greece and that allowed Greece to be admitted..(Although I am pretty sure that everyone knew that Greece was an ecconomic basket case when they were admitted but that was overlooked when things were boomingh of course).
Thanks for the reminder. I’d forgotten that part of the sordid story.
I think there is also a Northern European-Southern European duality here that is being missed. Of all the accounts I have read in the past few weeks, and thanks DD for yours, as well as the link to Naked Capitalism, this is what I have learned:
Merkel, or anyone, cannot kick Greece out from the EU.
Merkel, made the situation worse by insinuating herself in the 6/17 election.
The Greeks spend a bunch of $$ on weapons, and Tsirpas said he would cut defense to keep paychecks going and pensioneers paid.
Many Greeks despise NATO.
The wealthy Greeks do not want to pay taxes or continue to fund the pensioneers.
There seems to be some indications that Tsirpas is eyeing Argentina (not sure about Iceland) as a potential ally against the bankers and creditors.
The French socialist, Hollande, seems to be a bit of a fraud.
The fascist party, Golden Dawn, is getting a lot of press but I wonder if this is psy- ops (I hope it is only that!)
Tsirpas is young and very charismatic.
This rejection of European-style neoliberalism, the manufactured debt crisis, and the austerity budget should have positive reverberations for Americans fighting austerity budgets. If Tsirpas does win on the 17th he might be ostracized by the Northern EU countries, and all sorts of sanctions will probably be levied. On the other hand, it may be a great time to visit Greece and see how a resurgence of democracy and vision can achieve a TAZ against the banker elites. How long will it last, though? The bankers must have some game plan to deal with the eventuality they seem to be pushing…is it more bail-outs for themselves? Are they really that heartless? Or, perhaps some feudalist strategy?
Why do you say Hollande might be a fraud? Not disputing, just asking.
Goldman Sachs Billionaires and guys like Jamie Dimon have always had “a thing” for the Greek Isles. They want to own (steal) them.
Austerity and financial fuckery is their method.
I read somewhere that he is backtracking on his populist rhetoric, particularly in regards to austerity measures and also on pulling out of Afghanistan…he was just elected though, and in DC talking with Obama.
Did he get his ride on AF1, or just get to use the bathroom in the OO?
Greece has been a member of the EU since 1981, and Goldman Sachs had nothing to do with that. The Euro Zone is a different matter. There is a big difference between the two. I think you probably meant the Euro Zone and not the EU.
“it’s important to keep in mind that a “bailout” of Greece just uses the sovereign as a pass-through to bail out French and German banks. That’s the untold story here.”
Why is that story untold? It should be shouted from every rooftop! All bailouts in the EU and US were about bailing out not the recipient of the bailout funds but the recipients’ creditors.
They made bad loans, too bad. But they alos made wise “investments” in the politicians who have been and continue to bail them out.