EuroSpot: It’s (not) the Greeks again!

It’s (not) the Greeks again!

Lets end before we start: Greece is bankrupt! So crystal clear is this truth even a blind man sees the broke-country is finished. Think of the Nigerian Pidgin proverb: Dem no dey tell blind man say rain dey fall! It is raining thunderstorm in Greece!

A backjump. September 2006. Newspaper served. On a KLM cityshopper from Amsterdam. The title on the front-page: Greece Fiscal Misery! Same old topic; a bizarre submission that Greece had lied to the European Union Common Currency Zone (Eurozone) to gain entrance. In short, she was a cheat, the report concluded.

Greece Prime Minister Tsipras

There are reasons for admitting this proverbial broke-vulture into the Eurozone. The least believable is to blame a Greek-manipulated fiscal report. Long before Greece admission, politicians in Europe were acquainted with the truth that Greece is as corrupt as any country in Sub-Sahara Africa, for example Nigeria. The political nepotism and economic irresponsibility of Greece far outweighed anybody’s imagination. So, a claim of being a cheat could not be tenable to have neglected doing the needed if Greece must be admitted into the Eurozone.

At the other end is one of the strongest aims of Greece admission, which is, the ‘Big Fishes’ of the Eurozone were out to make a ‘permanent’ financial-quickie of a country double-killed by her own potpourri of corruptible tendencies. Admission into the common currency market only catapulted a comatose country into her own abyss.

Therapies to bring back Greece to fiscal sanity long before 2008 economic meltdown had not worked; attempts by finance-czars to halt her continual fall after 2008, if it worked at all, amounted to near-killer suffocate-dosage. Greece became to Europe an economic nuisance.

The blame is not solely on the doorstep of the bigger Eurozone countries. Greece had her problems before admission. I need not remind that longthroat is a perfect character of leaders running a corrupt state. These leaders forget most times there is a singular winner in a quickie-affair; except parties involved are clear about their intention from the word-go. Anything aside this is pretense. Greece and her leaders were never smart to have hidden her financial woes because her yansh was never covered. With this action, I could only think of Greece as an ostrich hiding her head in the sand.

Trust politicians, they are always spot-on with all sorts of rhetoric to whip-in maximum gain for themselves. The ensuing fiasco as to (non-)implementation of the austerity plans is a good chance. Think of recent gain by various right-wing parties in the last European parliament election and the picture is complete; Greece’s problem was a good selling point. A comparison of Greece prime minister and his finance minister to a second-hand car dealer from whom no one would want to buy a car is the least of jabs shot at Greece in recent times. When a bigger suffering befalls a man, smaller and hitherto below-status insults will begin to show face. Such is Greece misfortune at the moment.

Prime Minister Tsipras and his Finance Minister Mr. Varoufakis

Hurling insults at Greece will not make the problem leave us, we must discuss issues in ways that construct solutions. To begin with, Eurozone’s insistence on pulling through the hard austerity measures for which successive governments in Greece had been voted out by angry Greeks is an indicator of a failed policy. Latest protest in Athens against Tsipras Leftist-led government is an indication of what shall happen should Greece be pressed further. Reason given thus far that other countries have gone through same and returned cleaner is nothing but a hoax. European politicians know.

Reality check is a confirmation of contrary claims that financial sanity cum structural stability has returned to Italy. Spain’s (youth) unemployment rate is a clearer pointer to a looming problem waiting to explode. The Irish idyll is what it is at the moment: a sham. That Ireland and Portugal were able to payback billions as scheduled does not prove austerity measures are working. Sarah Warenknecht, German Leftist Leader in the Bundestag, said the obvious in a recent debate: The giant/stronger p(l)ayers in the Eurozone have thus far only been paying their own bills. They send money to broke-countries only to disburse/return them in installments as agreed in the austerity plans. The much needed structural reforms are not achievable (and cannot be) within a short period. The imminent collapse of the house of cards only need time to materialize. And we are confronted with the next crisis.

By the way, one cannot cease to wonder if Europe’s strongest woman-politician Germany’s Angela Merkel is this bereaved of ideas to rescue this house from collapsing. Only if in self-denial, the current austerity measures as put together will help only to postpone the next crisis to a later date. Speculation is that she wants to sit out her current/last term as German chancellor managing an European crisis she helped create with far-from-reality policies and disillusioned politics.

Talking about collapsing house of cards, a related Yoruba proverbs sheds light on the next issue. Ile ta ba fi ito ko, eri ni o wo! A house built with saliva is bound to be demolished with the first dew. That the Eurozone has only moved from one financial turbulence to the next confirms a foundation-fault. Think of the Leftist position upon the introduction of the common currency, which is that many countries outside Germany and countries with comparable strong economies and stable structures were not ready to introduce the Euro. Weaker countries may be allowed at a later date but not without having put in place crisis-proven structures and good economies.

Europe failed to listen. Many European countries, particularly the volatile members would not have listened anyway. They were bent on catching-in cheap monies. The immediate benefit of reaping now to sow later was too alluring to be ignored. Either way, Germany will always benefit from the arrangement, she too was interested in the immediate economic gains. This way, the countries with the Euro plunged themselves into spiraling crisis.

Were there intelligent political managers at the helm of affairs in countries like Greece, they would not have agreed to an all-importing economy; beyond farm produce Greece hardly exports anything tangible to/outside Europe. Same goes for Spain and Portugal. They are of course holiday paradise, a booming branch so long people come to their shores. Not to forget, Germany, Holland, France etc are also strongly represented in this branch, so the earnings are not going to the South alone. Add to that was the crazy unsustainable house market-price boom. The crash of the utopia could not have been louder anywhere than in Spain. House worth millions depreciated beyond redemption. Truth is, an economy built on market speculation and abracadabra economic theories cannot survive tomorrow. Germany’s Economy Minister summed-up the woes of these countries when he emphasized in a speech only an economy based on trade, handwork and industry is that which last the test of time, not one established on finance speculation and non-existent money/gains a la hedge-fund trickery etc!

Not only must Greece be enabled to start a new country by canceling a larger portion of her debt. If she must remain in the Eurozone without being caught in the next crisis, she must put structures in place, no doubt, but not under the scrutiny of current austerity measures. Here is the reason: Like Germany would never survive a day with a Greek-led economic package, same way can Greece never survive a Germany/Brussels-led economic package. Think of Germany’s ways and you inch a step closer to understanding the logic. Greece is not Germany, and Germany is not Greece. For instance, Germany’s Wirtschaftswunder was made possible not only for the Marshall Plan but because of Germany’s cultural understanding of the work concept. Greece will rise again within the Eurozone, if allowed to stay, but at Greece’s own pace and as acceptable within the purview of her cultural understanding of the same concept. Forcing them to work on a diet of rationed “dictatorship” from Brussels will not work; it will at best lead to successive Greek government being “toppled” at the polls even before her election!

On a final note, some are of the opinion the much talked-about wrong-footed take-off of the Euro is an issue we ought to be done with. I disagree. The mistake was made because political optimism was prioritized against commonsense economic choices. The current crisis is an opportunity for the Eurozone to correct these foundational faults. The fingers on the wall at the moment, particularly in Greece, point unfortunately to hurry-hurry politics that helped made the crisis possible in the first place. How else does one explain the initial no-renegotiation-stance by the Eurozone upon Tsipras’ election as Greek’s prime minister as if there was a singular correct perspective to resolving Greece fiscal problem. Think of Germany’s chancellor unwarranted meddling in Greek’s internal affairs shortly before election with soft threat that voting a party other than one which follows through on the austerity plans might spell doom for the tiny country. Few weeks after, the Bundestag voted with a resounding majority to temporarily extend Greece credit; an indication for other European countries to follow suit. Desperate moves would have been unnecessary were the package humane/good enough for any country to begin with.

Greece exit is in nobody’s interest. Of course, the Eurozone will survive with(out) Greece, but a stronger Greece in the Eurozone will benefit both Greece and the Eurozone. Like the adage goes, when two elephants fight, the grass suffers. At the moment, we must not forget the worst sufferer of the crisis is the common (wo-)man in Greece. They must be relieved.