Thursday, 16 July 2015

The truth about Greece is still coming out

I think a lot of people are wondering why Alexis Tsipras accepted a deal from Europe every bit as bad as the one the Greek people shortly before had rejected in a referendum. At least there seemed to have been a fair amount of celebrating by people on the left generally when the poll result came in. But then this deal appears, in which Greece gets some reprieve in the form of cash and in return agrees to some reforms designed to make the economy more competitive, and to prolong the austerity.

It's a bit of a puzzle, but then again there are a lot of things that are clear only dimly, in partial view, in this long discussion between Greece and its creditors to the north. One of those things is why the Greeks seem to want to remain part of Europe even though they voted for less austerity. Do they think that Europe is simply going to buckle, and give them more money with no conditions attached? There is a kind of illogic involved in the whole thing, and it might be because the Greeks accept that they need reforms but they still do not want to pay any tax. Which is not really surprising. It would be an unusual person who would openly go on TV to say he or she had done everything possible to avoid paying tax, and that they had been successful for most of their lives. Shame stops them, but by the same token pride makes the Greeks yearn to continue to remain within the Euro.

As for Tsipras, the poor man! Jerked from one side to the other on a short leash, trying to meet the expectations of an unruly electorate on the one hand and the equally pressing ones of a stubborn set of creditors on the other. I honestly feel sorry for him. Surely he could not have known, when he stood for office, that the job would be this hard. Through him are focused all the intensity of the will of the European creditors, aimed ultimately at getting the Greek people to change their behaviour - and pay their taxes - and the difficulty of managing all that energy, and making that unruly mass move in the right direction, is taking its toll on him.

If we have learned anything from recent events it is that nothing will happen quickly. Europe will not budge in its effort to get the Greek people to change their behaviour. Equally, each Greek will do everything possible to minimise the cost to him or her personally. Time will tell who wins. In the meantime, Australian superannuation funds slide up and down in value as the local stock exchange illogically responds to events in Europe, affecting us all. The GFC is somewhat like a zombie, it never seems to die.

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