Greece Triumphant: Tsipras Plays the Troika's Petty Game

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Disenfranchised protesters demonstrate their displeasure of austerity politics in central Athens, Greece, on Sunday 8 May 2016. Courtesy: Alkis Konstantinidis

By Ann-Marie de Veer
Saturday 28 May 2016

On Wednesday 25 May 2016, the Faustian Pact between the Syriza government in Greece and the bankers Troika, aka. the European Commission (EC), the European Central Bank (ECB) and the International Monetary Fund (IMF), reached a new zenith: the devilry of the Troika in handing over a long delayed tranche of the €86bn bailout fund agreed late last year will see the vast majority of the €10.3bn package being returned to the very same bankers who loaned it, as interest payments, while the debt mountain continues to climb for the Greek nation and its beleaguered people. The issues of debt restructuring and debt relief, a toxic subject likely to quicken the pace of the Eurozones capacity to author its own demise, was studiously avoided.

However, the Troika's acquiescence in releasing the funds is predicated on Greece adopting the fiscal equivalent of self-immolation: earlier this month, on Sunday 8 May, the Prime Minister, Alxis Tsipras, his Finance Minister, Euclid Tsakalotos, and the Syriza government had no option but to adopt even more fiscally regressive policies to secure the latest payment from the Troika's bailout fund. In a wafer thin majority of just 153 votes out of a House maximum of 300-seats, the Greek parliament passed legislation to further eviscerate the nations economy by implementing budgetary savings of €5.4bn. The three key planks of the reforms passed were the restructuring of the nations tax system, its pension systems and its social safety net for the poor, the sick and the growing ranks of the unemployed, who currently account for more than 25% of the population.

The notion that a Greek pensioner can survive, let alone live, on a paltry pension of just €384 per month is as ludicrous as the country ever being able to repay the debts that have been foisted upon it by an unelected and unaccountable bankers Troika from the European Union (EU).

Nonetheless, while the Greek people are scheduled for yet further depravations, over and above the catastrophe that continues to unfold on a daily basis in the country, the EC has an economic department who are attempting to make PIIGS (Portugal, Ireland, Italy, Greece and Spain) fly:

Courtesy: European Commission - 3 May 2016

The Eurozone is currently mired in a ubiquitous deflationary spiral not too dissimilar from the Great Depression of the late 1920's. The idea that Greece can claw its way out of this crippling deflationary vortex whilst only modestly improving its unemployment rate by a measly 1.1 percent over the next year is fanciful in the extreme. What is even more bizarre is that the Gross Public Debt is forecast to actually fall, by four percentage points, most probably financed by a projected improvement in the Public Budget Balance, which is based on an assumption that current, and scheduled, austerity measures will improve the balance sheet. The fact that deflationary forces are still in the ascendency, i.e. increases in taxation, reductions in disposable income and reduced public expenditure on education, healthcare and social services, appears to be lost on the EC's economic department. Nonetheless, the pinnacle of this forecast in economic buffoonery is an eye-watering increase in the nations GDP Growth Rate of three percentage points in just one year. While Greece may be capable of many things, this projection is as absurd as the idea that pigs can actually fly.

Of course, Tsipras, Tsakalotos, the Syriza Party and a growing minority of the Greek people, have now learned that the intransigence of the Troika, in both its negotiations and its insistence upon unrealistic and unworkable solutions to problems of its own making, is nothing more than a charade for public consumption and to reassure the international money markets that the EU has the situation under control. The truth, of course, is infinitely much more unpalatable: the Eurozone has been, and still is, on the brink of economic collapse as the ECB, bereft of the fiscal tools it needs to bring about economic stability to a disparate group of nations in differing stages of their economic cycles, can only tinker at the edges of an eternal maelstrom.

Meanwhile, Tsipras, Tsakalotos and the Syriza Party are playing the Troika's petty game while they wait for the inevitable debt relief the nation and its people need.

Now, who was it that said Greece is incapable of Herculean tasks?

The fool doth think he is wise, but the wise man knows himself to be a fool.
William Shakespeare