BERLIN - General strikes, political conflict, demonstrationsall that Greek drama packs a powerful punch. And the word from Berlin and Brussels until recently has been that without a 100 billion-euro rescue package, the Greek state would be looking at bankruptcy by July. But now, the tune is changing: no need for a rescue operation before September. Until then, Greece will be able to hold its head above water with what remains of the loans it has already received.
This playing for time works to no ones advantage. The new storyline is most likely due to the German governments hope that the current agitated level of German public interest in the Greek situation will eventually die down push rescue operations down the road a bit, and there will be less fuss when theyre wheeled out again. However, in view of rising opposition in Greece itself to Athens austerity measures, its becoming ever clearer that the course the European Union (EU) has embarked on is not going to get the job done.
The EU cannot force a cure. Economists in any case doubt that a country indebted to the degree that Greece is can clean up its act without a hardnosed combination of re-scheduling and cancellation. Europes taxpayers are doing the Greeks no favors by continuing on this course. All theyre doing, in fact, is paying spiraling debt service costs. Theater of the absurd, indeed.
Ordinary people in both Germany and Greece sense theres something wrong with this picture. Discontent is rife in the parliaments of both countries, as doubts spread about the ability of Europes politicians to get this thing under control. Its a bitter blow that the European Central Bank, in the biggest crisis the EU has ever faced, cant step up to the plate to broker a solution.
Because they bowed to political pressure a year ago and accepted Greek junk bonds as securities, sheer self-interest is now making them fight re-scheduling tooth and nail. Were that to happen, the bank itself would face the need for capital injection. And the new head of Germanys federal bank is playing right along: if the central banker had his way, more time would be bought with fresh taxpayer money. But at what absolutely crazy price?
Instead of bungling along from rescue operation to rescue operation, Eurolands politicians should wise up and accept the fact that Greeces debt disaster cannot be put right without letting private creditors in on the act. And instead of wasting precious time, Germanys finance minister should be using it to get out there and fight that fight in Brussels.
Read the original article in German