Tugging at threads
Everyone is tugging at threads and soon the whole thing may unravel.
Berlin and several troika officials deem that the rise of the extremes in Greece and the threat of a government breakdown are both exclusively Greek problems that they need not worry about. Our international lenders are unmoved by all this. They insist that Greece must fulfill its financial commitments and carry out its reform pledges while they refuse to enter a discussion about a debt settlement before the summer.
Senior German officials are shunning the warnings coming from Washington and their other European peers who are saying behind closed doors that the countries on the southern periphery of the European Union are facing the serious risk of social and political turmoil.
Part of this must be in the difference in cultures and mentalities. On top of that, it seems, is Germany’s chronic inability to behave as an enlightened leader.
What is important here is that Greece is again running the risk of being portrayed as a “special case.”
We had managed to step clear of that very dangerous territory for a year and a half, but I’m afraid it looks like we are slipping right back into it.
Here in Greece we are cursing at the troika and holding our foreign creditors accountable for much of the country’s current woes. Meanwhile, officials in Brussels and Berlin are tired of Greeks constantly asking for extra time and they are sick of government excuses about this and that. Greeks are weary and frustrated, but, unfortunately, so are the country’s foreign lenders.
Meanwhile, the signs from Greek society leave no room for misunderstanding. The voters will not tolerate any more salary and pension cuts or extra taxes.
Also, it is questionable whether the government will survive a fresh vote on old measures.
Only time will tell if it was a mistake to cause a fuss by crying out against “the new measures” – which has now limited the government’s scope of maneuver to next to nothing. The mood can by no means be reversed.
So what lies ahead? Greece is most probably facing a period of uncertainty, or even a temporary impasse, until one side backs down. An alternative scenario is that the country will be led to a general election (by design or accident).
In any case, this climate of uncertainty is very bad news for the real economy and the country’s growth prospects.