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Friday, June 15, 2012

Wary Greeks look to election with trepidation

ATHENS, Greece (AP) — At the dinner table, in the coffee shop, on the street corner, the one constant as Greeks prepare to vote once again is concern, and even fear. Depending on the outcome of Sunday's election, Greece could be forced out of the European joint currency, with potentially catastrophic consequences for the global economy.

Sour Mood of Greeks Sets Cliffhanger Vote

In a district that has picked the eventual prime minister in every Greek election for nearly 40 years, the surly mood of voters foretells a close contest in Sunday's crucial vote.

Greece Still Stuck in Euro Labyrinth

Greece Still Stuck in Euro Labyrinth
Wall Street Journal
Greece's election Sunday is unlikely to resolve the big question hanging over global markets: Will the country stay in the euro zone? Investors should brace for ...

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What you need to know about the Greek election

Greeks are heading to the polls this weekend for the second time in six weeks, preparing to vote in an election which could shift not only the course of the country, but of Europe itself.

As Greece votes, Europe holds its breath

Christian Science Monitor

As Greece votes, Europe holds its breath
Christian Science Monitor
Greeks vote Sunday in an election that many say could determine whether it stays in the eurozone. The prospect of a departure has much of Europe on edge.
Greece's Election and Your (blog)
Greece elections pose a crucial dilemma -- Q&
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France sees Berlin ties unhurt by Merkel remarks

PARIS (Reuters) - Relations between France and Germany are unaffected by Chancellor Angela Merkel's criticism of French economic performance and the two countries will continue working together, a French presidential source said on Friday. "These comments in no way modify the bilateral dynamic that is in motion," the source said. Merkel earlier criticized France as she and Socialist President Francois Hollande tussle over how to tackle Europe's deepening debt crisis ahead of a pivotal election in Greece and an end-month summit to agree urgent solutions. ...

Newsmaker: Greek leftist is "enfant terrible" of euro crisis

The Associated Press

Newsmaker: Greek leftist is "enfant terrible" of euro crisis
ATHENS (Reuters) - Greek leftist Alexis Tsipras, enfant terrible of Europe's debt crisis, cut his political teeth as a student protest leader in the 1990s and is now ...
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Key dates in Greece's debt crisis

Key dates in Greece's debt crisis
Fox News
A look at key dates in Greece's financial and political crisis.

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Merkel swipes French leader after jibes from Paris

German leader Angela Merkel criticized France’s economic performance on Friday in a growing war of words with its new Socialist President Francois Hollande over how to tackle Europe’s deepening debt crisis ahead of a pivotal election in Greece.

What to Expect of the Greek Elections

With two days left to Sunday's elections, Greek political leaders are spending their time in the streets and the central squares of major cities soliciting votes. Speaking at Omonoia Square downtown , the leader of the leftist SYRIZA party Alexis Tsipras re-iterated his position that this election is a referendum on the EU-IMF Memorandum, and ...

Europe holds breath on eve of Greek election as voters struggle to decide

Will the people turn to right or left? On the right is the old order that got them into the present financial mess. On the left are the radicals who are playing with fire

Which way is Greece going to go? Ahead of Sunday's election, with politicians railing from the hustings nationwide, the mood has reached fever pitch. "Euro thriller with all eyes on Athens," proclaimed the mass-selling Ta Nea on Friday, noting: "The entire planet is waiting with bated breath for the results of the Greek vote."

Late into the night and all day, workmen had been assembling a giant stand in Syntagma Square from which Antonis Samaras, the "pro-European" New Democracy leader will address the crowd on Friday evening.

The speech will close a campaign that, although brief, has also been extraordinarily bitter. Greeks are polarised in a way they have never been since the restoration of democracy in 1974. There has never been so much at stake.

If they go to the left and cast their votes in favour of the radical anti-austerity Syriza party, in the capitals of Europe it is unanimously agreed that they will be playing with fire.

If they go to the right and vote in favour of New Democracy they will get more of the old order which got them in the financial mess that has now brought their country to the brink but, so the logic goes, it gives them a bit of time. The conservatives have vowed to renegotiate the arduous fiscal measures demanded in return for rescue loans from the EU and International Monetary Fund but at least they have not pledged to rescind the policies as Syriza's leader, Alexis Tsipras, has done.

Tsipras, who on Friday night gives his finale speech in Salonika, the country's northern capital, has not only threatened to annul the "loan agreement". He insists he can have it both ways: Greece can reject the austerity attached to financial assistance and still stay in the euro. "No to the memorandum of bankruptcy," he told a mass rally Thursday. "Yes to the euro and to a national plan for economic recovery that will protect the people form bankruptcy."

Such pronouncements make European leaders shudder – reject the measures, they say, and there will be no more assistance. And without the loans Greece will default on its debt and be ejected from the single currency.

Greeks are not only divided, they are undecided. Although polls conducted on a private basis for parties have suggested that fear may well have the upper hand – following a discernible shift in support for New Democracy – there is broad consensus that, just as in the inconclusive election on 6 May, voters will make up their minds in the last 48 hours. In the prevailing uncertainty they could still go either way.

With no party expected to win an outright majority, the real question is how effective the new government will be. Apparently Greece will be given 100 days to prove that it can implement the kind of reforms that can put its ramshackle economy back on its feet, according to German officials. Whether it is the left or the right that emerges on top, the new government will be forced to walk a tightrope – with the opposition violently shaking the rope from below. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

Final pleas ahead of crucial Greece election

Last day of campaigning for Sunday's general election as politicians warn country faces expulsion from euro.

Greeks voting in anger cannot expect anything different from Syriza

If the leftwing coalition were to win Greece's election, it would still have to follow more or less the same policy as other parties

Anger is not a good adviser, especially in politics. That is why informed, rather than emotional, voters make better decisions. Representative democracy has several filters built into the decision-making process, not only for practical reasons, but to make sure that rationality prevails over emotion. We know from history that hasty emotional decisions have had tremendously negative consequences. They have led to several catastrophes, civil wars, bloodshed and international isolation.

Democracy needs people to participate with their minds, not their guts. This is why the democratic system pays a significant cost, in time and money, to examine every potential future consequence of a decision – even though in times of emergency or crisis, democracy seems to be inefficient, and almost incapable, of solving problems as fast and as radically as the situation demands. Democracy filters out transient feelings, increasing the chances that the right decision will be made in the long run.

But Greeks are right now full of a jumble of mixed emotions and feelings. They are consumed by anger, disappointment, and hopelessness. That is why they appeared to vote almost at random in the last elections on 6 May, which left no party capable of forming a government. Not only did they quadruple the percentage of the vote for the leftist grouping Syriza (4.6% in 2009 to 16.8% in 2012) but they also gave 23 times more votes to the neo-Nazi Golden Dawn party (0.3% in 2009 to 7% in 2012). They didn't vote for, they voted against. We should not be sidetracked by the fact that a leftist party came second and now is in with a chance of winning on Sunday. After all, a populist rightwing party, the Independent Greeks, was formed only a few months ago and gained, out of nowhere and without proposing anything, 10% of the electorate.

The big vote for Syriza pales in comparison to other success stories from the 6 May elections, which received very little media attention.

This emotional voting is bad news for the country, but for Syriza as well. Citizens didn't give a mandate for a left turn in governance. Certainly, they are outraged by the old political system. They despise politicians of the previous major parties (Pasok and New Democracy), but voting out of anger will undermine all future policies. If Syriza were to win a majority in the parliament (and supposing that this coalition of reformists, communists, Maoists, Stalinists could produce a sound and coherent manifesto), people would not support the policies of such a government. Majorities built upon sentiments are like sand castles. They get washed away by even small waves of reality. And today realities in Greece are like tsunami waves.

Voters filled with anger don't understand that choices in time of crisis are between bad and catastrophic. The problem is that they don't even want to discuss alternatives. They embraced the rhetoric of anti-memorandum parties, and they confuse cause and effect. Anti-memorandum voters tend to believe their economic problems all spring from the bad decisions (or even conspiracies) of the political system of the last three years. Nobody is explaining the difficult realities of Greek economy, the competitiveness deficit, the problem of living with 2009 incomes and having production structures fitted for the 1970s. Voters don't want to listen to anything. Actually they get even angrier with people who try to bring them rational arguments. They don't even listen to anti-memorandum politicians who whisper that even if we expel the troika, Greece will need a long period of adjustments, meaning more austerity along with structural reforms.

Sentiments prevail and that means ugly surprises the day after the elections. If Syriza were to form a government, it would be obliged to follow more or less the same policy as the other parties and that would be a major blow for the left-populist ideology that dominates Greece. For historical reasons the left, although it hasn't governed Greece, gained the ideological hegemony. It's ideas of statism and anti-reformism dominate even the conservative part of the political spectrum.

So it would be much wiser to let New Democracy and Pasok do the dirty job of trying to bring change to Greece. After all, distribution need surpluses. The only thing the next government (no matter who is elected) has to distribute is "blood, sweat and tears". And that is not what the left is promising in these elections. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

Bets are on Greek right but soccer may sway vote


Bets are on Greek right but soccer may sway vote
Betting firms see conservative victory* Greek parties say election too close to call* Soccer, weather may prove decisiveBy Dina Kyriakidou and Harry ...
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Cyprus weighs EU bailout, bilateral loan choices

(06-15) 07:00 PDT NICOSIA, Cyprus (AP) -- Cyprus' government spokesman says the island nation faces the choice of EU bailout money or a loan from another country to help prop up its Greece-exposed banks. Stefanos...

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Greeks torn by money dilemma

Greeks say continuing economic uncertainty is forcing them to move their savings abroad as the debt-ridden nation gears up for a crucial election this weekend.

Greece's Election and Your Portfolio

Los Angeles Times

Greece's Election and Your Portfolio (blog)
Real-Time Advice: Here's how stocks, bonds, gold and other assets may fare after this Sunday's vote, writes Jack Hough.
Greece elections pose a crucial dilemma -- Q&
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Markets await Greek election result

Markets await Greek election result
The Press Association
Stock markets are on edge as a make-or-break moment for the eurozone at a general election in Greece approaches. Success for anti-austerity parties, such as radical left-wingers Syriza, could lead to Greece leaving the euro, which would likely send ...
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George Osborne's plan B-minus calls for a statesmanlike Labour response

Ed Balls looked less credible by using the chancellor's Mansion House speech as an opportunity to score party political points

So George Osborne hasn't embraced a plan B to prevent the British economy's double-dip recession becoming a second great depression. He's simply "maxed out plan A", so Treasury officials have been saying, in order to boost business lending and keep the ship afloat in the raging storm. This is no time to score party political points. Let's leave that to Ed Balls. It's a moment to welcome the chancellor's relaxation of policy in response to changing circumstances.

You can read his speech – it's here – at the annual City/Whitehall bash in the Mansion House. Not a bad speech, I thought. It did at least address his critics' charges. Yet when heard in tandem with the governor of the Bank of England's speech – here – it scared the black tie trousers off veterans of such occasions such as the Mail's ex-Guardian City editor, Alex Brummer. The Guardian's Larry Elliott calls it "squeaky bum time".

In short the Treasury and Bank have decided to pump credit into the system to free up more loans to businesses and domestic borrowers, but have again rejected fiscal stimulus – for instance the temporary VAT cut urged by the shadow chancellor, Balls – which really would constitute plan B. This is more plan B-minus. The gloomy BBC pundit Robert Peston's banking chums, patriots to a man, promptly told him off the record that it probably wouldn't work because creditworthy firms lack the confidence to borrow and commercial banks won't risk lending to riskier clients despite the latest subsidy.

Will the protracted eurozone crisis finally be resolved or finally become Lehman Brothers II, dragging down us and the wider global economy a second time? That remains the crucial question. "We are hitting the panic button,'' the Lib Dem motormouth Lord Oakeshott helpfully told the morning newspapers. Well, that's better than not hitting it. Even Oakeshott concedes that.

Osborne has twice said this week that it may take a Greek exit from the eurozone to make the zone's leaders hit their panic buttons and do what's necessary to save the project. Germany can't do it all, protests Chancellor Merkel, the voice of German angst. If we all behaved like Germany we'd all soon be bankrupt, including Germany.

I have often wondered what it was like to live through the 1930s, that sense people had of drifting towards a cliff but unable to do much about it. With every day that passes this sense of helplessness in the face of anonymous but overwhelming forces grows stronger. So it is always good to hear a politician echo FDR's famous rallying cry of 1933 that "we are not powerless" in the face of the storm.

The gloom-mongering classes need reminding of that all the time. If plan A doesn't work, maxed out or not, try plans B to Z. Overnight ministers have trimmed the Vickers report on bank reform, a good day to bury controversial news, but at least they have finally got a plan.

Yet there remains a curious air of unreality about it. Many people in Britain – far more in Spain and Greece – are suffering privation in varying degrees. But many others are not, just like the 1930s when swathes of good new housing sprang up on city outskirts (it's still there) and those in thriving new industries enjoyed the new perils of consumerism. British city centres still thrive despite the boarded up shops and "to let" office blocks. Countless TV channels pour out escapist pap. In the 30s it was radio as depression-hit Europe plunged into revived nationalism and eventually war.

Such perils exist again now. Protectionism, the curse of the 30s, is creeping back in different forms (crafty China used a variable VAT rebate which is compatible with WTO rules), despite official denials. Look too at Sunday's Greek elections where parties of the right like Golden Dawn compete with the leftwing romantic escapism of Syriza, whose leader Alexis Tsipras (dark glasses, jeans and a sharp BMW bike, we get the picture Alexis) admires Venezuela's Hugo Chávez. If only Greece had some oil under the ground instead of having just one month's supply in the depots if things get nasty, as they may.

All sorts of separate crises bubble away, a mixture of fate and opportunism. Thirty years after the Falklands war ended (Laurence Topham's Guardian film is here), Argentina's populist government is making another hack-handed attempt to whip up an international storm to regain the islands against the settled will of their inhabitants. Fortunately its economy and military are in an even worse shape than ours, but it is a desperate sign of desperate times, a reminder of how much international authority and cohesion has eroded in some ways – not all – since 1982 when the UN worked well in the crisis.

Egypt, where last year's military coup against Hosni Mubarak (I have yet to spot much of that Arab spring) has been capped with Thursday's court-dissolution coup against the new Islamist parliament, is looking as scary as Greece at the eastern end of the Mediterranean.

How might the politics of either state impact upon the fragile Israel-Palestine-Iran triangle or the brutal sideshow now being waged by the surely doomed Assad regime in Syria and its neo-Stalinist Russian patrons? This is the way that interconnected worlds end, not with a whimper but with a mistimed, opportunist bang.

A crisis here, a false move there, a new regime in Beijing, a looming US presidential election, overstretched systems everywhere. David Cameron, for one, is engrossed in the finer points of his social engagements with Rebekah "country suppers" Brooks for Lord Justice Leveson, unfortunate to say the least as Europe topples.

In such swirling uncertainty I thought Ed Balls called it badly wrong – again – when invited to comment on the Osborne speech on Radio 4's Today programme. As with Syriza's Alexis Tsipras in Athens (who wants to stay in the euro, but postpone economic reform) the differences between Balls and Osborne are not quite so big as the shadow chancellor would have us believe. Pace and timing are important, but also matters of fine judgment.

But Balls persists in blaming Britain's flatlining economy on the coalition's 2010 austerity programme which – says he – derailed Labour's recovery model which saw growth resume in late 2010. "The spirit of Philip Snowden [renegade Labour chancellor] and Montagu Norman [austerity-driving governor of the Bank of England]" hung over the Mansion House last night, he claimed. It's a UK fiscal problem – tax and spend – not the liquidity problem Osborne is addressing, Balls insists.

Well, up to a point, Ed. But not really. Yes, the coalition may have slammed the brakes on spending too hard and fast in May 2010 – I think they did – but our world is very different from the 1930s, even the world of the poor (which may be what IDS is trying to say). In any case, the Today programme's grown-up economics sharp-shooter, Evan Davis, is too smart to put up with Ed for long.

Won't you admit that the rise in the price of global commodities – notably food and oil – have helped cause Britain's slowdown, Davis asked Balls? And (as Osborne says) the eurozone crisis too? So it's not just the austerity package to blame for the double-dip. Balls wriggled and more or less agreed. How much more persuasive would Gordon Brown's clever (too clever by half?) henchman have been to open-minded listeners if he'd conceded the point graciously.

Davis put him more firmly on the spot when he asked Balls for an estimate of how much the UK economy would grow if the government were to boost demand fiscally – as distinct from cheaper money – by cutting VAT for a while? Osborne said at the Mansion House that in the current state of the economy that would probably push up inflation (again) and simply suck in imports to meet revived demand. Balls repeatedly ducked the challenge.

Why do I pick on Balls when important Tory grassroots writers like ConHome's Tim Montgomery are rallying behind maxed-out Plan A? Partly because they're not all rallying – try this from Tory MP Douglas "Kamikaze" Carswell – and others like the Telegraph's Jeremy Warner seem underwhelmed.

All of which makes it important for Labour to sound statesmanlike to be credible in a crisis. Voters are less interested in blame than in solutions. No party has a monopoly of error or success. As more successful witnesses at Lord Justice Leveson's inquiry have reminded us – Blair, Major and even Cameron – the smart thing to do is give credit where it's deserved. Gordon Brown used the occasion to settle some scores and did badly. As his clever apprentice, Balls should have learned that lesson long ago. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

Euro exit threat hangs over Greek election

Greeks readied for their second election in six weeks with all the top candidates now calling for renegotiation of a bailout deal despite warnings that Greece must toe the line or leave the euro.

Sunday's election will be watched around the world amid concern over the shockwaves that a Greek euro exit would send through the global economy and will play into talks by European leaders divided on how to resolve the debt crisis.

US futures rise as Europe awaits Greek elections

FILE- In this Monday, June 11, 2012, file photo, Specialist Frank Masiello, left, and trader Glenn Kessler work on the floor of the New York Stock Exchange. Wall Street was on course to open higher Friday June 15, 2012, with Dow Jones industrial futures rising 0.4 percent to 12,650. S&P 500 futures gained 0.4 percent to 1,331.30. (AP Photo/Richard Drew, File)U.S. stock futures are rising after a volatile week with talk concerted action by major central banks to head off a crisis in Europe.

Syriza: A party under pressure

BBC News

Syriza: A party under pressure
BBC News
By Chloe Hadjimatheou BBC News, Athens If the anti-austerity party Syriza wins power in Greece's election on Sunday, the country's membership of the euro could be at risk. So how are they coping with the pressure? In one of the most impoverished ...
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On the campaign trail with Syriza

New force in Greek politics evades public fury

David Cameron to discuss Greek crisis with G20 leaders before summit

European leaders will consider any emergency measures that may need to be taken in the wake of Greek elections on Sunday

David Cameron will hold a video conference call on Friday afternoon with European leaders attending the G20 summit in Mexico next week in a bid to forge a common position on the eurozone crisis.

The leaders will consider any emergency measures that may need to be taken when the markets open on Monday in the wake of the Greek elections on Sunday.

It is likely that the call will focus on what the central banks can do to stabilise financial markets by providing liquidity and preventing a credit squeeze if the Greek election leads to a victory for the anti-austerity parties.

The call will be held between Cameron, the German chancellor, Angela Merkel, the French president, François Hollande, the Italian prime minister, Mario Monti, the Spanish prime minister, Mariano Rajoy, and the two leaders of the European Union.

A Downing Street spokesman tried to play down the significance of the call saying it was a routine discussion of the summit agenda.

Cameron's official spokesman said the call was a long-scheduled opportunity for the leaders to discuss the issues on the G20 agenda.

Asked about the Greek elections – triggered by the failure to form a government in Athens after polls last month – Cameron's spokesman said: "It is a matter for the Greek people and clearly they have to go through their democratic processes.

"But we need to see an end to the uncertainty which is damaging the European economy and damaging our economy."

He added: "We need to see action to deal with the problems in the eurozone sooner rather than later. The prime minister has talked on a number of occasions of the chilling effect the situation in the eurozone is having on our economy and the global economy."

The chancellor, George Osborne, warned in his Mansion House speech on Thursday night of dire consequences if Greece were to leave the eurozone without an ambitious plan to deal with the fallout.

Osborne again suggested that a Greek exit might be the only way to force fundamental reform in the currency area.

But allowing the struggling country to leave before measures were in place to contain contagion would be the "worst case for everybody", he said.

The comments came after interest rates on Spanish bonds hit fresh highs – sparking fears about the country's ability to service its debts. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

Britain unveils stimulus to parry eurozone threat

Britain has stepped up its action against the eurozone crisis by agreeing to offer billions of pounds in cheap loans to British banks, in co-ordinated action that took markets by surprise.

The government and Bank of England (BoE) announced the surprise plan late Thursday in London in a bid to force commercial banks -- which are reluctant to lend amid the threat of a Greek exit from the eurozone -- to lend to businesses struggling amid Britain's recession.

Tsipras says rivals 'plundered' Greece

Financial Times

Tsipras says rivals 'plundered' Greece
Financial Times
By Kerin Hope in Athens The leaders of Greece's centre-right New Democracy party and the leftwing Syriza coalition, close frontrunners in Sunday's general election, traded recriminations as they wrapped up a hard-fought campaign with outdoor rallies on ...
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