Grexit: The Kasperltheater takes its course – but risks keep increasing

End or metamorphosis of the Union ? Cartoon: Yellowman

There can be no doubt, that the Varoufakis gamble (as described here) remains the main proposition for european centrist parties and their team mate, the leftist greek government (and of course the Washington kibitzers). It is however far from assured, that the strategy will work. It is a high risk gamble and the odds of creating unintended consequences are good. There seem to be several Achilles heels.

Our Varoufakis gamblers have to increase uncertainty and tension in Germany while at the same time calming greeks down. This is a difficult job, especially today, when everybody has access to everybody else’s thoughts (potentially).

The bigger risk seems to be german wariness of Greece staying part of the Eurozone (both in the public and the CDU). Today commission president Jean-Claude Juncker catered for the german expactations of a Grexit. As he did, so did european leaders, who are “ready to show Alexis Tsipras the exit” – or so Bloomberg wants to make us believe.

The Euro-Gang was eager to stress the open-endedness of the ongoing negotiation process and to dissipate the wide-spread notion of a preordained outcome.This was necessary, because especially the german public is familiar with the pattern of a seemingly runaway crisis, which can only be defused as soon as their chancellor comes around to what is depicted as general european consenus.

It was a symbolic and a political intervention at the same time. Its ultimate goals were binding the germans to the Union and christian democrat hardliners to Angela Merkel, who will have to do an about-face next weekend… – once again. Before that, soon, very soon the Eurogang has to turn the corner.

Meanwhile the greek prime minister appealed to the common reasoning of social democrats of all strands (including radical leftists and christian democrats). Addressing the European parliament, Alexis Tsipras asked for a fair deal to keep his country in the eurozone.

Clearly these were NOT two unrelated events, nor did Tsipras and Juncker/the european leaders act as his antagonists. They acted like a single entity with two prongs, one of them mimicking toughness, the other preparing the ground for a compromise (which has in fact already been reached).

Of course the name of the game is debt forgiveness and, frankly, it is the only way to keep this five year old shell game up and running. So there is a natural alliance between those, who just want to keep the game going, those who want to see ol’ Lord Keynes reinstated in his former realm and those who aim at debt forgiveness for their state – only that this alliance must not be revealed at this stage of the game.

But there is another festering wound – the greek people.

At some point in time the Euro-Tsipras-Team will have to proclaim another rescue, another wonder of Greece. ATM machines will have to be refilled, banks reopened and capital controls will have to be lifted. Then Greeks will find themselves in a situation, which is very similar to the situation during the last five years – despite successful debt restructuring.

The question is, what they will make out of this situation. If the bank run resumes, if funds go on leaving Greece via electronic transfer, while foreign investors keep shunning the country, then it’s game over in the short run. Then the Varoufakis gamble has failed.

In a sense the Tsipras-Juncker situation is very much like the situation G. Papandreou and Samaras governments found themselves in. One has to ask oneself, why Greeks should trust the capabilitiies of Tsipras and Juncker more than say: of Samaras and Barroso. I am not quite convinced. I wouldn’t hold the breath.

Unabhängiger Journalist

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