Greek Debt Committee Just Declared All Debt To The Troika "Illegal, Illegitimate"
Whatever they say now does not matter. They had their chance : if they defaulted and left EU then they would have stand the chance. Being thrown out is completely different thing
EU finance ministers angered, may walk away from Greece - report
Handelsblatt says talks may fall apartMinisters may decide not to unlock funds, according to a report in Handelsblatt, citing unidentified people participating in the talks.
- Finance ministers said to be angered
- Greece said to refuse so-called immediate emergency measures
- Athens pushed for top-level talks, felt they could get a better deal with leaders
- Creditors want more reforms through parliament before unlocking 7.2 billion euros to aid program
Greece Invokes Nuclear Option: Tsipras Calls For Referendum
Update:Greek PM Alexis Tsipras has announced a referendum in a televised speech to the nation after another day of fractious negotiations with creditors closed without a deal.
The dramatic move comes after Athens rejected a proposal from the troika aimed at delivering some €16 billion in aid to Greece as part of an extension of the country's second bailout program.
- GREECE'S TSIPRAS SAYS CREDITORS POSED ULTIMATUM TO GOVT
- GREECE'S TSIPRAS SAYS CREDITORS PROPOSALS ARE AGAINST EU RULES
- TSIPRAS SAYS CREDITORS AIM TO HUMILIATE GREEK PEOPLE
- TSIPRAS SAYS WILL CALL REFERENDUM ON GREEK DEAL WITH CREDITORS
- TSIPRAS GREEK REFERENDUM WILL BE HELD ON JULY 5
- TSIPRAS SAYS HE NOTIFIED MERKEL, DRAGHI ON REFERENDUM PLAN
- TSIPRAS SAYS GREECE IS, AND WILL STAY PART OF EUROPE
- TSIPRAS SAYS GREECE NEEDS TO SEND DEMOCRATIC RESPONSE TO EU
Protothema now says the Greek parliament will meet on Saturday and a referendum will be called as early as next week. Whether this is simply a last minute attempt to put pressure on EU finance ministers ahead of Saturday's Eurogroup meeting remains to be seen, but one thing is for sure: Tsipras is playing a dangerous game with the ECB ahead of a difficult week that could very well see the imposition of capital controls.
Athenian Democracy vs. Neoliberal Gods
Prime Minister Alexis Tsipras allows the Greek people to decide their own fate via a democratic referendum. That’s enough to send the troika – the European Central Bank (ECB), the European Commission (EC), and the International Monetary Fund (IMF) - into a paroxysm of rage. Here, in a nutshell, is everything one needs to know about the EU “dream”.
Tsipras is, of course, right; he had to call a referendum because the troika had delivered “an ultimatum towards Greek democracy and the Greek people.” Indeed, “an ultimatum at odds with the founding principles and values of Europe.”
But why? Because the apparently so sophisticated politico-economic web of European “institutions” – the EC, the Eurogroup, the ECB – had to come up with a serious political decision; and due, essentially, to their nasty mix of greed and incompetence, they were incapable of making it. At least EU citizens now start to get the picture on who their enemy is: the non-transparent “institutions” who supposedly represent them.
The – so far — 240 billion euro bailout of Greece (which featured Greece being used to launder bailouts of French and German banks) has yielded a whole national economy shrinking by over 25%; widespread unemployment; and poverty soaring to unprecedented levels. And for the EU “institutions” – plus the IMF – there was never any Plan B; it was the euro-austerity way – a sort of economic Shock and Awe — or the (desperation) highway. The pretext was to “save the euro”. What makes it even more absurd is that Germany simply couldn’t care less if Greece defaults and a Grexit is inevitable.
And even though the EU operates in practice as a clumsy, reactionary behemoth, the puzzling spectacle remains of otherwise reputable intellectuals, such as Jurgen Habermas, denouncing the Syriza party as “nationalistic” and praising former Goldman Sachs golden boy, ECB president Mario Draghi.
Waiting for Diogenes
The July 5 referendum goes way beyond Greeks responding whether they accept or reject more humongous tax hikes and pension cuts (affecting many that are already below the official poverty line); that’s the sine qua non by the troika — qualified as “barbaric measures” by many a Greek minister — to unblock yet another bailout.
A case can be made that a more pertinent referendum on July 5 would be posing this question: “What is the red line for Greece to remain part of the euro?”
Prime Minister Tsipras and Finance Minister Varoufakis turned upside down insistent rumors that they would accept any humiliation to remain in the eurozone. That only served to radicalize even more the German politico-economic elite – from Iron Lady Merkel to Finance Minister Schauble. Their not so hidden “secret” is that they want Greece out of the euro now.
And that is leading quite a few Greeks — who still believed in the benefits of a supposedly common financial house – to slowly start accepting a Grexit. With their heads held high.
The ECB has not gone totally nuclear – yet, crashing the whole Greek banking sector. But by de facto capping the Emergency Liquidity Assistance (ELA) this past weekend, all hell will break loose if millions of Greeks decide to withdraw all their savings early this week, ahead of the referendum.
The Bank of Greece, “as a member of the Eurosystem”, as a communiqué stressed, “will take all measures necessary to ensure financial stability for Greek citizens in these difficult circumstances.” This implies serious limits on bank withdrawals – thus allowing Greece to survive until referendum day.
Still, no one knows what happens after July 5. Grexit remains a distinct possibility. Projecting further, and taking a leaf from Wagner’s Ring, it also seems clear that the euro “institutions” themselves have been adding fuel to the fire that may eventually consume the eurozone – a direct consequence of their zeal to immolate the Greeks just like Brunnhilde.
What Greece – the cradle of Western civilization — has already shown the world should make their citizens proud; nothing like a shot of democracy to make the Gods of Neoliberalism go berserk.
One may be tempted to invoke a post-modern Diogenes, the first homeless philosopher, with a lantern, looking for an honest man (in Brussels? Berlin? Frankfurt?) and never finding one. But instead of meeting the greatest celebrity of the day – Alexander the Great — let’s imagine another encounter as our post-mod Diogenes suns himself in an outdoor court in Athens.
“I am Wolfgang Schauble, the Lord of German finance.”“I am Diogenes the Cynic.”
“Is there any favor that I may bestow upon you?”
“Yes. Stand out of my light.”
We shal see what will the size of the gap on EURUSD be tonight
We shal see what will the size of the gap on EURUSD be tonight
Does not matter the gap. ECB and SNB printing. EU lying. IMF - no need to talk about them. FED - considering rate CUTS (not rate HIKE). All that means just one thing : something big is going to happen and I would not like to be on the wrong side of "it"
Now it becomes obvious how ridiculous this whole display of power to other members (Spain, Italy, France, ...) was. Germans claiming that it is illegal to haircut someones debt in the union - that is the most cynical statement I ever heard : where the hell would Germany be without debt write off? In 18th century
Now it becomes obvious how ridiculous this whole display of power to other members (Spain, Italy, France, ...) was. Germans claiming that it is illegal to haircut someones debt in the union - that is the most cynical statement I ever heard : where the hell would Germany be without debt write off? In 18th century
That is the oldest game in town. See what USA is doing
Greek banks' bad loans at around 45 percent: local paper
Greek banks' bad loans, which peaked after capital controls were imposed in late June, have dipped to around 45 percent of their loan books and are likely to fall further, daily newspaper Kathimerini said on Tuesday, citing bankers' estimates.
The figure for bad loans - defined as credit more than 90 days in arrears or likely to fall into that category - was 40.8 percent at the end of the first quarter, according to latest official figures.
The picture worsened in July, when in addition to capital controls banks were closed for a week, and when only about 15 percent of borrowers who had been repaying their loans normally in the past made monthly payments, the paper said.
But 80 percent resumed timely repayments in August and bankers are expecting further improvement this month, it said.
Under Greece's third bailout, which it agreed in July, up to 25 billion euros ($28 billion) were allocated to recapitalize the banks. Insiders say the sum required is more likely to be in the 10 billion to 15 billion euro range.
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Hellenic Parliament’s Debt Truth Committee Preliminary Findings - Executive Summary of the report
In June 2015 Greece stands at a crossroad of choosing between furthering the failed macroeconomic adjustment programmes imposed by the creditors or making a real change to break the chains of debt. Five years since the economic adjustment programmes began, the country remains deeply cemented in an economic, social, democratic and ecological crisis. The black box of debt has remained closed, and until now no authority, Greek or international, has sought to bring to light the truth about how and why Greece was subjected to the Troika regime. The debt, in whose name nothing has been spared, remains the rule through which neoliberal adjustment is imposed, and the deepest and longest recession experienced in Europe during peacetime.
There is an immediate need and social responsibility to address a range of legal, social and economic issues that demand proper consideration. In response, the Hellenic Parliament established the Truth Committee on Public Debt in April 2015, mandating the investigation into the creation and growth of public debt, the way and reasons for which debt was contracted, and the impact that the conditionalities attached to the loans have had on the economy and the population.The Truth Committee has a mandate to raise awareness of issues pertaining to the Greek debt, both domestically and internationally, and to formulate arguments and options concerning the cancellation of the debt.
The research of the Committee presented in this preliminary report sheds light on the fact that the entire adjustment programme, to which Greece has been subjugated, was and remains a politically orientated programme. The technical exercise surrounding macroeconomic variables and debt projections, figures directly relating to people’s lives and livelihoods, has enabled discussions around the debt to remain at a technical level mainly revolving around the argument that the policies imposed on Greece will improve its capacity to pay the debt back. The facts presented in this report challenge this argument.
All the evidence we present in this report shows that Greece not only does not have the ability to pay this debt, but also should not pay this debt first and foremost because the debt emerging from the Troika’s arrangements is a direct infringement on the fundamental human rights of the residents of Greece. Hence, we came to the conclusion that Greece should not pay this debt because it is illegal, illegitimate, and odious.
It has also come to the understanding of the Committee that the unsustainability of the Greek public debt was evident from the outset to the international creditors, the Greek authorities, and the corporate media. Yet, the Greek authorities, together with some other governments in the EU, conspired against the restructuring of public debt in 2010 in order to protect financial institutions. The corporate media hid the truth from the public by depicting a situation in which the bailout was argued to benefit Greece, whilst spinning a narrative intended to portray the population as deservers of their own wrongdoings.
Bailout funds provided in both programmes of 2010 and 2012 have been externally managed through complicated schemes, preventing any fiscal autonomy. The use of the bailout money is strictly dictated by the creditors, and so, it is revealing that less than 10% of these funds have been destined to the government’s current expenditure.
This preliminary report presents a primary mapping out of the key problems and issues associated with the public debt, and notes key legal violations associated with the contracting of the debt; it also traces out the legal foundations, on which unilateral suspension of the debt payments can be based. The findings are presented in nine chapters structured as follows:
Chapter 1, Debt before the Troika, analyses the growth of the Greek public debt since the 1980s. It concludes that the increase in debt was not due to excessive public spending, which in fact remained lower than the public spending of other Eurozone countries, but rather due to the payment of extremely high rates of interest to creditors, excessive and unjustified military spending, loss of tax revenues due to illicit capital outflows, state recapitalization of private banks, and the international imbalances created via the flaws in the design of the Monetary Union itself.
Adopting the euro led to a drastic increase of private debt in Greece to which major European private banks as well as the Greek banks were exposed. A growing banking crisis contributed to the Greek sovereign debt crisis. George Papandreou’s government helped to present the elements of a banking crisis as a sovereign debt crisis in 2009 by emphasizing and boosting the public deficit and debt.
Chapter 2, Evolution of Greek public debt during 2010-2015, concludes that the first loan agreement of 2010, aimed primarily to rescue the Greek and other European private banks, and to allow the banks to reduce their exposure to Greek government bonds.
Chapter 3, Greek public debt by creditor in 2015, presents the contentious nature of Greece’s current debt, delineating the loans’ key characteristics, which are further analysed in Chapter 8.
Chapter 4, Debt System Mechanism in Greece reveals the mechanisms devised by the agreements that were implemented since May 2010. They created a substantial amount of new debt to bilateral creditors and the European Financial Stability Fund (EFSF), whilst generating abusive costs thus deepening the crisis further. The mechanisms disclose how the majority of borrowed funds were transferred directly to financial institutions. Rather than benefitting Greece, they have accelerated the privatization process, through the use of financial instruments.
Chapter 5, Conditionalities against sustainability, presents how the creditors imposed intrusive conditionalities attached to the loan agreements, which led directly to the economic unviability and unsustainability of debt. These conditionalities, on which the creditors still insist, have not only contributed to lower GDP as well as higher public borrowing, hence a higher public debt/GDP making Greece’s debt more unsustainable, but also engineered dramatic changes in the society, and caused a humanitarian crisis. The Greek public debt can be considered as totally unsustainable at present.
Chapter 6, Impact of the “bailout programmes” on human rights, concludes that the measures implemented under the “bailout programmes” have directly affected living conditions of the people and violated human rights, which Greece and its partners are obliged to respect, protect and promote under domestic, regional and international law. The drastic adjustments, imposed on the Greek economy and society as a whole, have brought about a rapid deterioration of living standards, and remain incompatible with social justice, social cohesion, democracy and human rights.
Chapter 7, Legal issues surrounding the MOU and Loan Agreements, argues there has been a breach of human rights obligations on the part of Greece itself and the lenders, that is the Euro Area (Lender) Member States, the European Commission, the European Central Bank, and theInternational Monetary Fund, who imposed these measures on Greece. All these actors failed to assess the human rights violations as an outcome of the policies they obliged Greece to pursue, and also directly violated the Greek constitution by effectively stripping Greece of most of its sovereign rights. The agreements contain abusive clauses, effectively coercing Greece to surrender significant aspects of its sovereignty. This is imprinted in the choice of the English law as governing law for those agreements, which facilitated the circumvention of the Greek Constitution and international human rights obligations. Conflicts with human rights and customary obligations, several indications of contracting parties acting in bad faith, which together with the unconscionable character of the agreements, render these agreements invalid.
Chapter 8, Assessment of the Debts as regards illegtimacy, odiousness, illegality, and unsustainability, provides an assessment of the Greek public debt according to the definitions regarding illegitimate, odious, illegal, and unsustainable debt adopted by the Committee.
Chapter 8 concludes that the Greek public debt as of June 2015 is unsustainable, since Greece is currently unable to service its debt without seriously impairing its capacity to fulfill its basic human rights obligations. Furthermore, for each creditor, the report provides evidence of indicative cases of illegal, illegitimate and odious debts.
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