It’s been difficult to keep track of the back and forth on Greece’s chances to secure a bailout package in time for the country’s March deadlines. As soon as solutions are found and touted, someone finds a way to dash all hope with fresh demands or new criteria for acceptance. In the course of a single day, the bailout package can go from assuredly approved to dead in the water and back again. Its debatable which side has been guiltier of delaying or moving the finish line, but ultimately, the consequences are severe for both sides.
Most troubling about this back and forth, is what it means for the little remaining trust that exists between the Greek government, the general population and the country’s many creditors. The people are suspicious of the parliament and technocrat government, the country’s political leaders are wary of anything that resembles intervention from outside and the EU and IMF don’t appear to trust a word coming out of Athens. No one, it seems, thinks the other is acting in their interest. Today hardly helped that process as a few pivotal EU leaders presented a plan that would push any bailout package back to April, following Greece’s national elections. The move, pushing any distribution past the March bond deadlines, appears to critics as a move to either force default or influence the election outcome by hinging approval on a government that would be sure to institute what the Union leaders want most – more cuts.
Leaving aside the argument of whether austerity is really the best approach to getting Athens out of the ditch – that will come in a later post – its difficult to see what the purpose of this proposal actually is. Greece appears close to the edge for so many reasons, with Iran’s oil cuts adding to the list today, why would EU leaders add more stress to the situation if they really wanted it to succeed?
This question goes back months to when Angela Merkel appeared to offer little hope for certain countries to rebound, sewing doubt where one would think she would offer a bit more optimism. Since then, she has been a voice of reason but also one of cautious doom, keeping the process moving but without much confidence that it would lead anywhere or really even be seen through. From the Greek side of things, I can see how the pessimism, added to the actual, real-life pressures they are dealing with, is starting to grow heavy. Are the country’s creditors actually doing something to solve the problems – to find a solution – or just staving off the inevitable? Would an outside plan work, even if complete control was handed over to Germany? Is it preferable just to face the obvious sooner than later or is there really a viable path forward that does not mean giving up any sense of control or autonomy?
Image: The Financial Post