Sir, – All that emerged from the EU summit discussions on Greece was yet another “agreement” that Greece would prepare yet another list of “reforms”. Dear Lord.
If such reforms were feasible they would have been presented already.
Greece is both illiquid and insolvent. It has a shedload of debt it can never repay. It has a broken-backed economy and a humanitarian crisis. “Reforms” are completely beside the point at this stage.
The new Greek coalition government’s anti-austerity mandate was neutralised by the intransigence of euro zone finance ministers – effectively Germany – back in February. At that time, Wolfgang Schäuble warned Athens not to question the framework of existing agreements or “everything is over”. That’s democracy for you. The Greek government’s attempts to scrape the funding necessary to pay public salaries while meeting its maturing debt obligations now have an air of desperation about them.
Greece is drowning in the platitudes of its “friends” about remaining in the euro zone while simultaneously being emasculated by the insistence of these same friends that it continue with “reforms”.
The whole debacle is now embarrassing. It is deeply damaging to Europe. It is also deeply humiliating for a people whose culture shaped European civilisation. Greece is haemorrhaging people, capital and morale.
In their obsession with “moral hazard”, the euro zone “leaders” seem willing to see Greece impose capital controls – they clearly don’t see the irony – on what money remains in the system. They appear to be prepared to court global geopolitical risk by reviving Greece’s traditional relations with Russia when, at the same time, they are concerned about tensions with Russia over the Ukraine.
Greece should have left the euro zone three years ago. The euro zone should have facilitated an orderly exit.
The costs to Greece of remaining now greatly exceed the costs of exit and default. The myth of some kind of financial Armageddon in the event of a Grexit is just that – a myth. Markets which, as Prof Joseph Stiglitz has documented, were complicit in the failings of Greece’s public finances, will make lots more money.The sacrifices of the Greek people will finally benefit their own economy and not the balance sheets of large institutions. – Yours, etc,
Prof RAY KINSELLA,
Ashford, Co Wicklow.