Exclude humanitarian spending from budget surplus requirements? I am surprised this has not been floated yet..
Even the Eurocrats do not want people denied food, heating and electricity... One hopes.. -raghu. On Mon, Mar 30, 2015 at 12:13 PM, Robert Naiman < [email protected]> wrote: > Suppose that we were only allowed to raise a single demand in the context > of the Troika-Greece confrontation. Suppose that the demand had to satisfy > the following properties: > > 1. It's winnable. > 2. Winning it would make a substantial difference to the well-being of a > bunch of people in Greece. > 3. The demand would be popular in Greece. > 4. The demand would be marketable in the West, something we could organize > a bunch of people around, such as labor leaders, health groups, Members of > Congress. > > What should the demand be? > > ---------- Forwarded message ---------- > From: Mark Weisbrot, CEPR <[email protected]> > Date: Mon, Mar 30, 2015 at 9:06 AM > Subject: Are the European Authorities Destroying the Greek Economy in > Order to "Save" It? > To: [email protected] > > > [image: CEPR logo] > <http://org.salsalabs.com/dia/track.jsp?v=2&c=BzgzWIjlU8Bgzf78mLdr0fE%2Ba9uoRu6y> > Are the European Authorities Destroying the Greek Economy in Order to > "Save" It? > <http://org.salsalabs.com/dia/track.jsp?v=2&c=4SVN8gEJ%2FqOd7d%2BNGH9tI%2FE%2Ba9uoRu6y> > > By Mark Weisbrot > ------------------------------ > > This article was published by Al Jazeera America > <http://org.salsalabs.com/dia/track.jsp?v=2&c=jTR5WXjWZJhnYtSJ1lva7PE%2Ba9uoRu6y> > on March 30, 2015. > ------------------------------ > > There is a tense standoff right now between the Greek government and the > European authorities – sometimes known as the Troika because it includes > the European Commission, the European Central Bank (ECB), and the > International Monetary Fund (IMF). ECB President Mario Draghi denied > <http://org.salsalabs.com/dia/track.jsp?v=2&c=gL%2FG2qsUjw%2F5HBb4dH96t%2FE%2Ba9uoRu6y> > this week that his institution is trying to blackmail the Greek government. > > But blackmail is actually an understatement of what the ECB and its > European partners are doing to Greece. It has become increasingly clear > that they are trying to harm the Greek economy in order to increase > pressure on the new Greek government to agree to their demands. > > The first sign that this was the European authorities’ strategy came on > February 4 -- just 10 days after the Syriza government was elected -- when > the European Central bank cut off > <http://org.salsalabs.com/dia/track.jsp?v=2&c=3iQOt3qFbln54Lp5mZ3ybfE%2Ba9uoRu6y> > the main source of financing for Greek banks. This move was clearly made in > bad faith, since there was no bureaucratic or other reason to do this; it > was more than three weeks before the deadline for the decision. > Predictably, the cut off spurred a huge outflow of capital from the Greek > banking system, destabilizing the economy and sending financial markets > plummeting. More intimidation followed, including a slightly veiled threat > <http://org.salsalabs.com/dia/track.jsp?v=2&c=7J2DBkBlhAYztf5%2Fu6yamPE%2Ba9uoRu6y> > that Emergency Liquidity Assistance – Greece’s last credit lifeline from > the ECB – could also be cut. The European authorities appeared to be hoping > that a “shock and awe” assault on the Greek economy would force the new > government to immediately capitulate. > > It didn’t work out that way. The Syriza party had a mandate from the Greek > electorate to improve their living standards after six years of > Troika-induced depression and more than 25 percent unemployment. The new > Greek government backed off its demand for a debt “haircut,” and made other > compromises, but wasn’t going to simply surrender as if there had been no > election. The European authorities finally blinked on February 20 and > agreed to grant a four month extension, through June, of the prior > “bailout” agreement – the quotes are necessary because most Greeks have not > been “bailed out,” but rather thrown overboard, having lost more than 25 > percent > <http://org.salsalabs.com/dia/track.jsp?v=2&c=1lGlmLxtAKzoIrhmIaGiMvE%2Ba9uoRu6y> > of their national income since 2008. > > The immediate condition for the February 20th agreement was that the Greek > government present a list of reforms that they would undertake, which they > did, and which European officials approved. Remaining issues were to be > negotiated by April 20th, so that the final installment of IMF money – some > 7.2 billion euros – could be released. One might assume that the February > 20th agreement would allow these negotiations to take place without > European officials causing further immediate and unnecessary damage to the > Greek economy. One would be wrong: a gun to the head of Syriza was not > enough for these “benefactors;” they wanted fingers in a vise, too. > > And they got it. The ECB refused to renew the Greek banks’ access to its > main, cheapest source of credit that they had before the January 25 > election. And they refused to lift the cap on the amount that Greek banks > could loan to the Greek government – something that they did not do to the > previous government. The result has been to create a serious cash flow > problem for both the government and the banks. Because of the ECB’s credit > squeeze, the government could soon find itself in a situation that the 2012 > government faced when it delayed payments to hospitals and other > contractors in order to make debt payments; and it could even face default > at the end of April. > > The amounts of money involved are quite trivial for the European Central > Bank. The government has to come up about 2 billion euros of debt payments > in April. The ECB has recently shelled out 26.3 billion euros to buy > eurozone governments’ bonds as part of its 850 billion euro quantitative > easing > <http://org.salsalabs.com/dia/track.jsp?v=2&c=YXtpomq%2BUK4ZfFTv%2F7i9O%2FE%2Ba9uoRu6y> > program over the next year and a half. The ECB’s excuses for causing this > cash crunch in Greece ring hollow: for example, it argues that banks under > the previous government didn’t have to have the limit that the ECB is > imposing on banks now, because the prior government had committed to a > reform program that would fix its finances. But so has this one. > > It could hardly be more obvious that this is not about money or fiscal > sustainability, but about politics. The European authorities want to show > who is boss. And also, this is a government that they didn’t want. And they > really don’t want this government to succeed, which would encourage Spanish > voters > <http://org.salsalabs.com/dia/track.jsp?v=2&c=cHtS3xaHGBFqfVhfAjfFOPE%2Ba9uoRu6y> > to opt for a democratic alternative (Podemos) later this year. > > The IMF had projected > <http://org.salsalabs.com/dia/track.jsp?v=2&c=6GWZS81YA975Fg3G4RllsvE%2Ba9uoRu6y> > [PDF] the economy to grow by 2.9 percent this year, and until the last > month or so there was good reason to believe that – as in 2014, after years > of gross over-estimates – their forecast would be on target. This growth > would likely have kept Syriza’s approval ratings high, together with its > measures to provide food and electricity to needy households, and other > progressive changes. The ECB’s actions, by destabilizing the economy and > discouraging investment and consumption, will almost certainly slow > Greece’s recovery, and could also be expected to undermine the government’s > support. > > If carried too far, European officials’ actions could also inadvertently > force Greece out of the euro. It’s a dangerous strategy, and they should > stop undermining the economic recovery that Greece will need if it is to > achieve fiscal sustainability > > > Mark Weisbrot > <http://org.salsalabs.com/dia/track.jsp?v=2&c=i%2F6jlqkJdTFrU3Evyp4Bp%2FE%2Ba9uoRu6y> > is co-director of the Center for Economic and Policy Research, in > Washington, D.C. and president of Just Foreign Policy > <http://org.salsalabs.com/dia/track.jsp?v=2&c=%2FpGV6XeCww29HB7pgEy0vHCnx272yRRh>. > He is also the author of the forthcoming book *Failed: What the "Experts" > Got Wrong About the Global Economy* (Oxford University Press, 2015). > > More from CEPR > Reports > <http://org.salsalabs.com/dia/track.jsp?v=2&c=vL%2Bwo2eAe5cGNqbZqMzZ2%2FE%2Ba9uoRu6y> > Op-eds & Columns > <http://org.salsalabs.com/dia/track.jsp?v=2&c=bacKp7f6peN%2FcQxlaFGayvE%2Ba9uoRu6y> > Data Bytes > <http://org.salsalabs.com/dia/track.jsp?v=2&c=8vG1A1%2F9hxNUgG%2F3%2BgUDWvE%2Ba9uoRu6y> > Beat the Press > <http://org.salsalabs.com/dia/track.jsp?v=2&c=GIWE8wndyo4jeEzjDKjgfPE%2Ba9uoRu6y> > CEPR Blog > <http://org.salsalabs.com/dia/track.jsp?v=2&c=jxodUe%2FuYCzLuI8BfS2qMPE%2Ba9uoRu6y> > The Americas Blog > <http://org.salsalabs.com/dia/track.jsp?v=2&c=frijEADu9sMtK02oVSCix%2FE%2Ba9uoRu6y> > Haiti Relief and Reconstruction Watch > <http://org.salsalabs.com/dia/track.jsp?v=2&c=%2BDZZRIe0BLIn9nDVxCbq8vE%2Ba9uoRu6y> > Events > <http://org.salsalabs.com/dia/track.jsp?v=2&c=QBUtzTOlt1SaH3f4ujQZz%2FE%2Ba9uoRu6y> > > Donate > Please consider making a donation > <http://org.salsalabs.com/dia/track.jsp?v=2&c=QqyHsfwMpaL%2B5fjzTi0KTPE%2Ba9uoRu6y> > to CEPR. 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