The Greek Tragedy - Spear's Magazine

The Greek Tragedy

So the EU gets ready for a 50% default to keep Greece in the eurozone: have the eurocrats gone stark, staring bonkers?

Call me a simpleton, but I cannot see how the eurocrats think Greece can ever belong inside the eurozone! The facts are simple: on the creation of the eurozone in 1999, Greece was barred as its current deficit and total national debt were way out of quilter with the Maastricht Treaty’s sensible criteria for entry.

The fact that everyone else’s figures were as well, apart from tiny Luxembourg, is beside the point I am making here, because Greece’s debts were so much higher than anyone else’s.

Then along came that blood-sucking hydra-funnelled tentacled monster on the face of humanity, Messers Goldilocks Sachs, and hoovered up any worthwhile Greek assets and packaged them up into CDOs all wrapped nicely in CDSs for consumption by the ever-hungry debt markets, as infamously pumped up by Alan Greenspan’s creation of practically zero interest rates, and, hey presto, suddenly Greek indebtedness didn’t look much worse than anybody else’s, so she was let into the dull club where one size suits all, no problem.

The Greeks fell on the euro-bonanza of cheap interest rates and abundant credit, which is what they always do when anyone bears them inexpensive or even free gifts, and proceeded to pocket the money and head off-shore as fast as their shipping lines could load up and slip anchor from Piraeus under cover of darkness. This time the Greeks were fleeing with Helen rather than trying to bring her home: of the 100 Greek billionaires, only one is onshore paying his taxes.

Then, over the next ten years, Greek efficiency – an oxymoron if ever there was one – fell behind Germany's by 30%, which in a monetary union that does not allow currency realignments has compounded the entry and subsequent flight problems to cause the current crises: Greece cannot pay the interest on its debts and has no hope of ever repaying their capital.

So the EU gets ready for a 50% default to keep Greece in the eurozone: have the eurocrats gone stark, staring bonkers? Do they think that this means the Greeks can make good on that productivity gap over the next ten years?

Do these flat-earthers really think the German economy will stand still for the next ten years while the Greeks catch up? Do they really think that Greece’s output of goats, olive oil, ouzo and lilo-hires is going to catch up with Mercedes, BMW, Audi, Volkswagen, Opel and Airbus? Do they really think that anyone is going to privatise the two-gauge railway system running between the olive groves going nowhere with drivers earning €80,000 per annum? Do they really think anyone is going to privatise the other nationalised industries, such as power, where they are run by and for the benefit of the unions and their members? Goldilocks has already picked off the viable assets, as Goldilocks always does.

No. The whole idea is patently so ludicrous as to be totally naïve. And yet that is the measure of the eurocrats’s sheer stupidity, as they cling to their dream of a United Europe that looks like, but isn’t, the United States, and never will be as long as Greece is in it. And the same could be said of Portugal, and possibly Ireland.

What the blindly arrogant and just plain stupid eurocrats don’t see is that their untenable dream could easily spread the contagion to Spain and Italy, which otherwise would have a sporting chance of staying in the eurozone, as now their blinkered view is threatening the whole euro project: that is the real risk they are running in trying to save the existing euro-zone.

Mind you, some of us never saw the point of it all in the first place, and won’t be crying if it all ends in tears!