Monday, 13 July 2015

Captains and Kings

The Greek drama continues. Mr Tsipras may have hoped he'd get an easy ride when he came back to Brussels and presented the original proposals as 'his'. He hasn't had it. The Belgian PM went for him in no uncertain terms, and several of the other national leaders have made it clear he's really going to have to deliver this time round. It would be funny if it wasn't so serious and hurting so many people. As the Belgian PM pointed out, Greece has had a better deal than many others, in fact it has enjoyed benefits and bailouts no one else has got and it has failed to deliver anything so far.

He isn't getting an easy ride at home either. His own Party is split between those who want to bite the bullet, and the hardliners who still think they can get away with robbing the bank and not paying the penalty. And the populace are angry, with most demanding he find a solution that lets them stay in the EU and the €uro - there seems to be little liking now for the concept of returning to the Drachma and the freefalling economy not reforming anything promises. I think Mr Tsipras is learning at first hand Abraham Lincoln's dictum - you can fool some of the people some of the time, but you cannot fool all of the people all of the time.

I suspect that a deal will be struck, but Mr Tsipras is going to have to accept some things he won't like, and Brussels/the ECB will make some small concessions to sweeten the pill, but there will be some big penalties if the reforms aren't delivered. And in the meantime the 'little people' - the voters - continue to suffer the consequences of successive regimes that thought they could give handouts endlessly in pursuit of popularity in the polls. For a government to balance its books, it needs to have a realistic income, and that can come only from tax. If you don't collect them, you can't expect to get everyone else to fund you.

As the Belgian PM pointed out rather forcefully, the Greek populace enjoy a generous set of benefits the Belgians and everyone else is paying for. Their 'Minimum Wage' is almost twice that of five other EU states, and they enjoy a pension age at least 17 years younger than anyone else. Time to reform, and more important, time to actually do what they have talked about for the last five years,

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