Tuesday, May 22, 2012

Politically Tone Deaf German Chancellor Angela Merkel Making Defeat of German Austerity Program for Greece a Near Certainty

Exactly What About Politics 101 Does She Not Understand

Greece will be voting on June 17 (again) to elect a new parliament.  Until the last election, which was so fractured it settled nothing and had to be cast aside, two parties, Pasok which is a center left party and New Democracy, a center right part controlled the country.  Now Syriza, an anti-austerity and anti-Bailout conditions party is surging into the lead.  Syriza finished second in the pseudo-election in May and is expected to be a contender for the leading vote getter in the June election.

A Syriza win would send its leader into the government as head of state, and send Europe into an unknown possibly cataclysmic economic nightmare. So Europe has a strong interest in Syriza not winning.  But they have no clue how to bring this about, and so they are doing what just about everyone else does who acts with little or no knowledge, they are making things worse.

First of all the Europeans are telling the Greeks that the election is really a referendum on staying in the Euro and the Eurozone.  The problem, the Greeks may not believe this.  And now German Chancellor Angela Merkel has entered into domestic politics in Greece by suggesting a parallel election to the legislative elections.

All sides agree that Chancellor Angela Merkel spoke by telephone with President Karolos Papoulias on Friday. A spokesman for the caretaker government, Dimitris Tsiodras, said Ms. Merkel “conveyed to the president thoughts regarding a referendum that could be conducted in parallel to the elections, asking Greeks whether they want to remain in the euro zone.”

While Ms. Merkel admits making the phone call to the President, who is really a figure head rather than an actual government leader, she denies suggesting the referendum on Greece remaining in the Eurozone.  But her denials don’t matter.  The charge has credibility because Germany for years has been dictating austerity (read huge economic suffering) on Greece, so the idea that she would interfere in domestic affairs is entirely believable.  The Greeks are not happy.

The Greek conservative leader Antonis Samaras called it “unacceptable” for Germany’s chancellor to issue such a proposal.

The quick condemnation from Greek politicians illustrated unequivocally how raw feelings are in Athens over questions of sovereignty and underscored how the uncertainty over Greece’s future has turned rumors and unconfirmed reports into fuel for even more heated exchanges. The dispute was only the latest fallout from the instability in Greece, which continued to roil markets across Europe.

All of this of course merely increases the likelihood of a huge Syriza victory and a huge defeat for Ms. Merkel in her quest to impose German policy on the European Union.  Sometimes, Ms. Merkel, the best you can do is to do nothing.  Lesson learned?

Unfortunately for Ms. Merkel, even if she catches on public opinion on Germany is pushing the Greeks in the opposite direction of what Germany wants.

German officials have tried to exert pressure on the Greeks without appearing to meddle in the domestic political process. The German media have shown little compunction.

The Frankfurter Allgemeine Zeitung, an influential daily newspaper, ran an editorial on the front page calling the last Greek election “just the overture,” and stating that Greek voters needed to understand that the upcoming return to the polls would be “a referendum on the question of whether the Greeks would stay in the euro zone or not.”

The article seemed written to push Greek buttons, saying that with a return to the old drachma currency, Greece would be “an upmarket Bulgaria,” referring to Greece’s neighbor, which after decades of Communist rule lagged far behind Greece in its development. Even after leaving the euro, Greece could still receive aid, but it would no longer be credits but instead “a form of humanitarian emergency aid.”

Finally the paper said “hopefully one won’t have to consider an international protection force,” as in countries to the north, referring presumably to Bosnia and Kosovo.

While things could change, at this point a huge victory for Syriza would be a huge headache for Europe and would result in a a person with this background and his compatriots to be running the Greek government.

Alexis Tsipras
The Last Trotskyite

Alexis Tsipras in his office at the Greek parliament building
 on Friday. He says Greece has been used as a guinea pig
 for the rest of Europe. Photograph: Martin Godwin
Before Greeks went to the polls on 6 May, neither Tsipras nor his party were a name to be reckoned with. If anything both were the butt of vague mockery: a former pony-tailed student communist leading a rag-tag band of ex-Trotskyists, Maoists, champagne socialists and greens. Tsipras's assistants – wielding Louis Vuitton bags and fashionable sunglasses – readily admit they are signed up "militants" mostly of the anti-globalisation cause.

Yeah, that doesn’t sound all that good either. 

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