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How the world sees Greece
Monday, September 24, 2012
Euro-Zone Push Hits Hurdle in Berlin
Progress on containing the crises in Greece and Spain faces holdups in Germany, where Merkel is reluctant to ask parliament to vote on measures that are likely to raise fierce opposition from within her own coalition.
Rift With IMF Adds to Greece's Tensions in Pivotal Week
 CNBC.com | Rift With IMF Adds to Greece's Tensions in Pivotal Week New York Times ATHENS — As Greece enters a pivotal, potentially chaotic week in its economic crisis, tensions between Athens and the country's international lenders have reached a boiling point. The government is resisting a push by the International Monetary Fund ... Give Greece more time, says French PM Greece Denies Increased Budget Shortfall, But Will it Unlock Bailout Funds? Greece denies 20 billion euros budget shortfall |
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Rift With I.M.F. Adds to Greece's Tensions in Pivotal Week
Greeks are increasingly angry over the prospect that public salaries and pensions will be sharply cut again in a last-ditch bid to secure a 31.5-billion-euro loan installment.
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IMF hints at more time for Greece to implement hardline austerity
Managing director Christine Lagarde says IMF 'prepared to be flexible' – saying both growth and austerity are necessary
The International Monetary Fund dropped the broadest of hints on Monday night that it would give Greece more time to implement its hardline cuts programme as it warned that Europe posed a "critical risk" to a weakening global economy.
Christine Lagarde, the Fund's managing director, said the Washington-based institution was "prepared to be flexible" and said both growth and austerity were needed to put an end to a crisis which will next month again force the IMF to cut its global growth forecasts.
The head of the IMF was speaking as financial markets responded nervously to Portugal's decision to dilute its deficit-reduction programme, the protracted talks over a new package of help for Greece, and mounting political pressure on the Spanish government over its package of cuts and tax increases.
Pedro Passos Coelho, Portugal's prime minister, said his government was abandoning plans to raise employee social security payments from 11% to 18% of their salary following widespread public protests. In Spain, Mariano Rajoy's government was facing one of its toughest weeks since it came to power last year as it sought approval for a new wave of reforms designed to pave the way for a European rescue.
Meanwhile, in Greece there was mounting suspicion among members of Antonis Samaras's government that the IMF has been deliberately blocking agreement on €11.9bn (£9.5bn) of spending cuts necessary for Greece to receive the next tranche of its bailout.
"Basically they want the measures to fail so that Greece is forced to ask for another haircut [on its debt] but we know that is not the view of the EU commission or Germany which is strongly against another debt restructuring at this time," said one Greek official in Athens.
Lagarde said that Europe's debt crisis and the projected sharp budget retrenchment in the US early next year posed critical risks, and said the Fund would show flexibility to countries in trouble.
"We continue to project a gradual recovery, but global growth will likely be a bit weaker than we had anticipated even in July, and our forecast has trended downward over the last 12 months", she said in a speech in Washington. The Fund had been expecting the global economy to grow by 3.5% this year and by 3.9% in 2013.
"A number of factors are weighing the global economy down. At the centre of them all is the element of uncertainty; uncertainty about whether policymakers can and will deliver on their promises."
The IMF managing director said the lasting scars from the crisis included youth unemployment in countries like Greece and Spain, high levels of public debt and a poorly functioning financial sector.
"Worryingly, the energy to implement the reforms that have been agreed –as well as the other reforms that we need – is waning. I am often asked, five years into the crisis, whether the financial sector is safer today than it was then. My answer? 'Despite real progress, not yet.'"
Lagarde said Europe remained the epicentre of the crisis, adding that programmes should be tailored to the needs of individual countries and backed by financial help.
"On the Fund's part, we are favourably considering that this be done in as timely and flexible a manner as possible: slowing the pace of fiscal adjustment where needed; focusing on measures rather than targets; and, above all, keeping the emphasis not just on austerity, but also on growth as we believe that the two can be reconciled and should not be mutually exclusive."
In Madrid, some 1,300 police were being drafted in to keep protesters away from the Congreso de los Diputados, the parliament building, as an "occupy parliament" movement called for a popular, indefinite blockade starting on Tuesday.
Metal fencing and several rings of security manned by police were being put in place to keep demonstrators away from the building, with authorities claiming a blockade would be a direct attack on Spanish democracy.
"We will not let parliament be surrounded or taken over," warned Cristina Cifuentes, the interior ministry's Madrid chief, who claimed extreme left-wing and right-wing groups were both involved.
It was unclear whether organisers, who define themselves on the internet as "democratic, anti-neoliberal, anti-capitalist and anti-patriarchal", would be able to mobilise a large number of demonstrators.
The protest coincides with the beginning of a debate in the Catalan regional parliament in Barcelona which threatens to see it demand that Rajoy's government formally recognise a right to self-determination for the wealthy north-eastern region.
Rajoy's government will this week approve a new reform programme and next year's budget, opening the way for it to request a bailout from eurozone countries. That would allow the European Central Bank to intervene in bond markets and drive down the country's exorbitant borrowing costs.
Several of Spain's most important indignado protest groups have refused to back Tuesday's attempted peaceful blockade of the Congreso de los Diputados organised by the "On Your Feet!" group, which says it does not intend to stop deputies going to work.
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Greek Parliament Head Steps Aside In Corruption Probe
 Greek Reporter | Greek Parliament Head Steps Aside In Corruption Probe Greek Reporter Greek Parliament President Evangelos Meimarakis, handpicked for the position by Prime Minister and New Democracy Conservative leader Antonis Samaras, said he will suspend himself from his duties during a reported investigation into alleged corruption ... Greek Supreme Court to take over probe into 'corrupt' politicians |
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German Bundestag Would Balk at Greek Writedowns, Meister Says
German Bundestag Would Balk at Greek Writedowns, Meister Says Bloomberg German lawmakers would refuse to back a further writedown of Greek debt because such a move would amount to a third aid program, a senior ally of Chancellor Angela Merkel said. “How could we possibly do that?” Michael Meister, the parliamentary ... |
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Eurozone crisis live: Portugal confirms U-turn after austerity protests
French prime minister Jean-Marc Ayrault has said Greece should be granted an extension to its financial targets, as Portugal's leader prepares for a U-turn on an unpopular tax rise
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French PM: Give Greece more time
France has said Greece should be given more time to meet the terms of its international bailout, in the clearest call yet by a leading eurozone country for an easing of the stringent conditions attached to the €174bn rescue package.
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Muslim Protests Break Out In Greece
ATHENS, Greece — Greek riot police used tear gas and pepper spray to disperse Muslim protesters who clashed with officers Sunday during a rally against...
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Give Greece more time, says French PM
France has said Greece should be given more time to meet the terms of its international bailout, in the clearest call yet by a leading eurozone country for an easing of the stringent conditions attached to the €174bn rescue package.
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Athens' deficit is '€20bn' – double official figure
Greece's budget deficit is in reality almost double the amount officially acknowledged by the government of Prime Minister Antonis Samaras and currently stands at about €20bn (£16bn), the German magazine Der Spiegel reported yesterday.
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From Nigeria to Athens, Muslim protests rumble on
DUBAI (Reuters) - Muslims protested in Nigeria, Iran, Greece and Turkey on Sunday to show anti-Western anger against a film and cartoons insulting Islam had not dissipated.
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Prophet film protesters clash with Greek police
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In Spain, Austerity and Hunger
As Spain tries desperately to meet its budget targets, it has been forced to embark on the same path as Greece introducing one austerity measure after another, cutting jobs, salaries, pensions and benefits, even as the economy continues to shrink.
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Portugal prepares U-turn on social security payment increase
Ministers pledge to renegotiate austerity measures with unions and employers amid growing popular backlash
Portugal's government is preparing a U-turn on an announced rise in social security contributions that would have instantly increased workers' payments by nearly two-thirds amid a growing popular revolt against austerity measures.
Hundreds of thousands of people took to town squares across the country a week ago to protest at the announced rise, which raised contributions from 11 to 18% of salaries, sparking a pledge by the government this weekend to reconsider the unpopular move.
The centre-right prime minister, Pedro Passos Coelho, had solemnly announced the measure to shocked Portuguese workers, who would have lost the equivalent of almost a month's salary, during a televised speech a fortnight ago.
"The financial emergency that the country sank into in 2011 is still not over," he said at the time. "We have begun to attack the problems we face but have not yet dominated them."
But an eight-hour meeting of the presidential state council was besieged by protesters in the small hours of Saturday morning and ended with a government pledge to renegotiate deficit-cutting measures with trade unions and employers.
"The council was informed of the government's readiness to study, within the framework of the social bargaining process, alternatives to changes in the social security rate," a statement said after the council meeting. The council is presided over by the president, Anibal Cavaco Silva, and Passos Coelho is one of its members.
Half a dozen protesters who were arrested outside the presidential palace on Friday night are due to appear in court on Monday. Demonstrators had demanded the government's resignation and chanted: "Thieves, thieves!"
The mounting anger in Portugal about the austerity imposed by the bailout came as France appeared ready to offer concessions to Greece, the first country to need help from eurozone partners. The French prime minister, Jean-Marc Ayrault, told the news website Mediapart: "The answer must not be a Greek exit from the eurozone.
"We can already offer it more time … on the condition that Greece is sincere in its commitment to reform, especially fiscal reform," he said.
Aid to Greece from the IMF and European bodies is reliant on the cash-strapped country meeting tough austerity measures. Last week there were reports – later denied – that the latest inspection by the troika could be delayed until after the US presidential elections in November.
The Portugese rethink marked a turning point in the country's patience with austerity, which was imposed on it after it asked for a €78bn bailout from the troika of the European Union, the European Central Bank (ECB) and the International Monetary Fund (IMF) last year.
Portuguese voters appeared to accept austerity measures as inevitable at the time and in June 2011 they elected a coalition of Passos Coelho's centre-right Social Democratic party and more right-wing People's party to carry them through.
The country is now in its worst recession since the 1970s and the economy is expected to shrink by more than 3% this year. Recession is expected to continue in 2013, further reducing Portugal's chances of shaking off troika control.
Passos Coelho had his knuckles rapped by the state council, which called for "political and social dialogue to seek consensus" rather than the unilateral imposition of measures in its Saturday morning statement.
The council also asked the government, which had accompanied the rise in individual social security payments with a cut in those made by employers, to share the burden of austerity more evenly. "Any solutions should … guarantee an equitable and just distribution of sacrifices as well as protecting those families with the lowest income," it said.
Both the council and the government recognised, nevertheless, that Portugal must meet its obligations to the troika – which means finding another way to raise €6bn a year.
Earlier this month the troika agreed to relax Portugal's deficit targets for the next two years but the government believes fresh measures are still needed to meet the new targets.
Portugal's trade unions will bring their own deficit-cutting proposals to the table. They include a tax on financial transactions, higher business taxes, a harder line on tax fraud and higher taxes on dividend payments to large shareholders. A 0.25% tax on financial transactions would raise €2bn, according to the General Workers Confederation of Portugal.
Passos Coelho's government will propose a new cut in holiday subsidies for workers, the Expresso weekend newspaper reported
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Why are Golden Dawn members the darlings of popular Greek TV shows? | Aris Chatzistefanou
The response of journalists and TV producers to the neo-Nazi Golden Dawn party is at best muddled, at worst complicit
Golden Dawn, the neo-Nazi party of Greece, made a rather strange proposal this week: let's create a new public holiday, they said, to commemorate victims of Communist guerrillas at the end of the second world war. By "victims", they mainly refer to the Nazi collaborators who were slaughtered after ferocious battles in southern Greece. Recalling the period before and during the civil war of 1946 to 1949 doesn't seem like the best suggestion for a debt-ridden country. Unfortunately the same idea seems to thrill the country's mainstream media.
Hardly a day goes by without the appearance of an article in a leading newspaper that presents Golden Dawn as some kind of "golden opportunity" for Greek society. Many well-known journalists seem eager to criticise the racist violence of the neo-Nazis only so they can pour scorn on what they characterise as the excessive "violence of the left".
"Those of us believing in democracy owe a big 'thank you' to Golden Dawn" wrote a columnist in Kathimerini daily, explaining that "it is an opportunity for legality to confront the quasi-legitimate violence of the left".
The following day a columnist in To Vima daily was wondering why the violence of the blackshirts (fascist death squads in Italy) is seen as worst than the violence of hooligans or "pseudo Che Guevaras" who clash with the police.
By leftwing "violence" commentators usually refer to big strikes that can lead to social unrest in the streets or even jeering and "yogurt throwing" against politicians. When hundreds of protesters battled riot police over plans for a gold mine in northern Greece recently, a newspaper compared their action with neo-Nazi squads who have been attacking foreign workers and stabbing immigrants.
This line of argument is reminiscent of the so called "horseshoe theory" according to which the far left and the far right, rather than being at opposite ends of the political spectrum, resemble one another like the ends of a horseshoe. This idea, which was at its peak during the cold war, appears in Greece disguised as the voice of "logic" against the "violence of the extremes". What the media seem to forget is that the country was brought to its knees by the "extremism of the political centre" – a neoliberal project that ruptured the fabric of the society and paved the way for Golden Dawn.
The 40% increase in suicides, the 50% rate of unemployment among young people and the breadlines in the centre of Athens are the result of a "systemic violence" imposed on the population by the political elites – not the "extremes". The fact that the internal devaluation increased the sovereign debt and the economy is forecast to contract by 25% by the end of 2014 is evidence of the total failure of the policy imposed by the IMF and the EU.
Under these circumstances the violence of the neo-Nazis represents a useful distraction from the social genocide of the austerity packages, but also a unique opportunity to attack those who oppose the measures.
A few days ago the president of the Greek journalists' association criticised the media for being "advocates" and "contractors" for the neo-Nazi party. It's a harsh criticism, but not unfounded. For several weeks after the last general elections party members of the Golden Dawn became darlings of popular TV shows. In the meantime horrendous crimes committed by neo-Nazis against immigrants are often hushed up. The Greek media need to answer a simple question: whose side are you on?
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