Socialist group syriza poised to win majority
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MLK 3 evils of society: "Capitalism was build on the exploitation and suffering of black slaves and continues to thrive on the exploitation of the poor
They were given a two-month extension to their bailout just before Syriza were elected, but their bailout is only on condition that it implements the austerity measures it agreed to in 2012. And quite rightly: Why should we keep chucking money at Greece when it doesn't want to take the necessary steps to reduce its debt?
The country is skint; deeply in debt; can't (and doesn't want to) pay it back; lived high above its means for years; doesn't collect its taxes on time;, produces little; squandered lots of money on the Olympics; and enjoyed a generous social welfare state. Now it's over. Syriza can't rescue Greece. Nobody can..... unless the likes of Germany and Britain (each British household paid £500 as part of the Greek bailout) want to keep shelling out the cash, and why would they want to keep doing that?
Between 2000 and 2007, Greece actually enjoyed one of the fastest-growing economies in the Eurozone, growing at an annual rate of 4.2% each year thanks to foreign investment. Despite that, the country continued to record high budget deficits each year.
After the removal of the right-wing military junta, the government wanted to bring disenfranchised left-leaning portions of the population into the economic mainstream. In order to do so, successive Greek governments have, among other things, customarily run large deficits to finance enormous military expenditure, public sector jobs, pensions and other social benefits. Greece is, as a percentage of GDP, the second-biggest defence spender among the 27 NATO countries after the United States, according to NATO statistics.
Add to that Greece's government tax income, which is always lower than expected each year (with the State only collecting less than half of the revenues due in certain years), then you can see why the country is in doolally.
The game is up. It’s time for Greece to leave the eurozone and move on
The stand-off between Greece and the rest of the eurozone will escalate, neither side will blink and the country will default
A break-up needs to be carefully managed and orderly, not chaotic and disorganised Photo: Getty Images
By Allister Heath
29 Jan 2015
The Telegraph
It’s time for Greece to leave the euro, default on its debt and move on. I write this with a heavy heart as the short-term consequences for ordinary Greeks could be disastrous, but there is now no other practical way out.
Syriza is serious about change and simply will not honour the country’s debts or stick to international agreements. Germany is equally serious about not accepting a debt write-off. An N24/TNS poll shows that 43pc of Germans are unwilling to negotiate debt relief or a longer loan repayment schedule with Greece. As to Brussels, the European Commission president Jean-Claude Juncker has said that “there’s no question of writing down Greek debt”. The stand-off will escalate, and escalate further. Neither side will blink, which means that a Grexit and default is now almost inevitable.
At least 77pc of Greek government debt is owned by official bodies or governments, according to Open Europe, rather than the private sector, so a massive default won’t be catastrophic for private institutions. Anybody with any sense will have seen this coming, and sold as much Greek debt as they could get away with.
Sadly, Alexis Tsipras, the new prime minister, is a delusional socialist. He doesn’t want to privatise state assets and leads a party that doesn’t accept economic reality. But even though his analytical framework is entirely wrong, some of his conclusions are actually right. The Greeks have suffered far too much in recent years, and something needs to change. The problem is that the Tsipras way will inevitably lead to disaster in the long run.
A break-up needs to be carefully managed and orderly, not chaotic and disorganised. It is also important for Eurosceptics such as myself to acknowledge that there are many upsides to the euro, as well as downsides. Greece has a stable and highly credible currency; its people have enjoyed an unprecedented period of sound money. That is why so many middle-class Greeks still support retaining the single currency; many were ready to put up with a catastrophic depression for fear of worse. It is extremely likely that a Syriza-backed new Greek currency will be a catastrophe. Fiat currencies only function if they are credible; the new drachma won’t be.
Its value will plunge, inflation will return and economic dislocation and extreme pain will follow. Miracles are always possible, of course. A top central banker could be hired, or a clever monetary arrangement found. But in the context of a far-Left, anti-capitalist government, the chances of that are almost nil.
The single currency was always a mistake, and I was one of a number of commentators who has always opposed its creation. Single currency areas can work only under one of three scenarios, none of which has ever been on the cards in Greece and much of Europe.
Britain was right to keep the pound and not adopt the euro, despite what the Europhiles said
First, and ideally, you need an economy with radical levels of flexibility, a small government, a well-educated and motivated entrepreneurial workforce, and labour markets that adjust to shocks. A hit to demand leads to a very speedy reallocation of resources; workers are willing to take nominal pay cuts to keep their jobs; and the country bounces back quickly from shocks without suffering from massive unemployment. That is the ideal economic system — but sadly it is not on the agenda. Many libertarian economists, especially in the US but also in Europe, backed the euro because they thought it would trigger free-market reforms, but while some have taken place, they have been insufficient in scale and scope. Ultimately, you can’t impose an economic system on a reluctant society.
Second, an ultra-mobile pan-European society. In such a world — which doesn’t exist in anything like the way I’m imagining — unemployed people in Greece are able to move en masse to parts of the eurozone with better jobs prospects. This still happens to some extent in the US, where states like Texas have been fuelled by mass intra-state migration, and poor areas such as Detroit have simply lost their population. Workers do also move within the UK, and within other countries, though generally not enough. There is now lots of migration within Europe, but even the numbers we see aren’t enough to allow economies to adjust properly. There is no single European demos; people speak different languages and have different cultures. This won’t change for the foreseeable future.
Third, a massive pan-European welfare state with a federal tax system and permanent redistribution from rich to poor areas. In such a world, where the one-size-fits-all monetary policy is unable to cater for a hit to parts of the eurozone, fiscal policy kicks in. Germany and other richer parts send billions to poor states. In return, the power of nations to borrow is dramatically curtailed: member states lose much of their sovereignty. In such a world, Greece would simply not be allowed to borrow and spend as it saw fit, and many more functions currently operated by national governments would be transferred to Brussels.
The eurozone has a choice if it wants to survive: it needs to operate one of these models. It won’t embrace the first, though some countries have pushed through some decent structural change over the past couple of years that shouldn’t be ignored or neglected. Labour mobility will never develop enough to be the primary solution, and in any case is under threat from anti-migration forces. Centralisation and redistribution is the European establishment’s favourite solution — but that means a drastic diminution of self-government, the creation of a fully-fledged European country. Such an entity can be given all of the trappings of democracy but it won’t properly function as one as its residents won’t feel that they are part of one country. It will thus be inherently unstable.
Greece's economic woes by numbers That is why I’m deeply pessimistic about the eurozone’s long-run survival. At some point, perhaps in the 2020s, it will be torn apart, potentially triggering a global depression if trillions of euros are written off or devalued away. That is another reason to hope that a Grexit is managed carefully. It won’t be especially globally significant but it will serve as a dry run for the time a major economy pulls out. The markets need to learn that currencies can leave as well as join the euro, and policy-makers need to learn how best to minimise the fallout.
allister.heath@telegraph.co.uk
The game is up. It’s time for Greece to leave the eurozone and move on - Telegraph
Last edited:
Alexis Tsipras' "open letter" to German citizens published on Jan.13 in Handelsblatt, a leading German language business newspaper
Most of you, dear Handesblatt readers, will have formed a preconception of what this article is about before you actually read it. I am imploring you not to succumb to such preconceptions. Prejudice was never a good guide, especially during periods when an economic crisis reinforces stereotypes and breeds biggotry, nationalism, even violence.
In 2010, the Greek state ceased to be able to service its debt. Unfortunately, European officials decided to pretend that this problem could be overcome by means of the largest loan in history on condition of fiscal austerity that would, with mathematical precision, shrink the national income from which both new and old loans must be paid. An insolvency problem was thus dealt with as if it were a case of illiquidity.
In other words, Europe adopted the tactics of the least reputable bankers who refuse to acknowledge bad loans, preferring to grant new ones to the insolvent entity so as to pretend that the original loan is performing while extending the bankruptcy into the future. Nothing more than common sense was required to see that the application of the 'extend and pretend' tactic would lead my country to a tragic state. That instead of Greece's stabilization, Europe was creating the circumstances for a self-reinforcing crisis that undermines the foundations of Europe itself.
My party, and I personally, disagreed fiercely with the May 2010 loan agreement not because you, the citizens of Germany, did not give us enough money but because you gave us much, much more than you should have and our government accepted far, far more than it had a right to. Money that would, in any case, neither help the people of Greece (as it was being thrown into the black hole of an unsustainable debt) nor prevent the ballooning of Greek government debt, at great expense to the Greek and German taxpayer.
Indeed, even before a full year had gone by, from 2011 onwards, our predictions were confirmed. The combination of gigantic new loans and stringent government spending cuts that depressed incomes not only failed to rein the debt in but, also, punished the weakest of citizens turning people who had hitherto been living a measured, modest life into paupers and beggars, denying them above all else their dignity. The collapse of incomes pushed thousands of firms into bankruptcy boosting the oligopolistic power of surviving large firms. Thus, prices have been falling but more slowly than wages and salaries, pushing down overall demand for goods and services and crushing nominal incomes while debts continue their inexorable rise. In this setting, the deficit of hope accelerated uncontrollably and, before we knew it, the 'serpent's egg' hatched – the result being neo-Nazis patrolling our neighbourhoods, spreading their message of hatred.
Despite the evident failure of the 'extend and pretend' logic, it is still being implemented to this day. The second Greek 'bailout', enacted in the Spring of 2012, added another huge loan on the weakened shoulders of the Greek taxpayers, "haircut" our social security funds, and financed a ruthless new cleptocracy.
Respected commentators have been referring of recent to Greece's stabilization, even of signs of growth. Alas, 'Greek-covery' is but a mirage which we must put to rest as soon as possible. The recent modest rise of real GDP, to the tune of 0.7%, signals not the end of recession (as has been proclaimed) but, rather, its continuation. Think about it: The same official sources report, for the same quarter, an inflation rate of -1.80%, i.e. deflation. Which means that the 0.7% rise in real GDP was due to a negative growth rate of nominal GDP! In other words, all that happened is that prices declined faster than nominal national income. Not exactly a cause for proclaiming the end of six years of recession!
Allow me to submit to you that this sorry attempt to recruit a new version of 'Greek statistics', in order to declare the ongoing Greek crisis over, is an insult to all Europeans who, at long last, deserve the truth about Greece and about Europe. So, let me be frank: Greece's debt is currently unsustainable and will never be serviced, especially while Greece is being subjected to continuous fiscal waterboarding. The insistence in these dead-end policies, and in the denial of simple arithmetic, costs the German taxpayer dearly while, at once, condemning to a proud European nation to permanent indignity. What is even worse: In this manner, before long the Germans turn against the Greeks, the Greeks against the Germans and, unsurprisingly, the European Ideal suffers catastrophic losses.
Germany, and in particular the hard-working German workers, have nothing to fear from a SYRIZA victory. The opposite holds. Our task is not to confront our partners. It is not to secure larger loans or, equivalently, the right to higher deficits. Our target is, rather, the country's stabilization, balanced budgets and, of course, the end of the grand squeeze of the weaker Greek taxpayers in the context of a loan agreement that is simply unenforceable. We are committed to end 'extend and pretend' logic not against German citizens but with a view to the mutual advantages for all Europeans.
Dear readers, I understand that, behind your 'demand' that our government fulfills all of its 'contractual obligations' hides the fear that, if you let us Greeks some breathing space, we shall return to our bad, old ways. I acknowledge this anxiety. However, let me say that it was not SYRIZA that incubated the cleptocracy which today pretends to strive for 'reforms', as long as these 'reforms' do not affect their ill-gotten privileges. We are ready and willing to introduce major reforms for which we are now seeking a mandate to implement from the Greek electorate, naturally in collaboration with our European partners.
Our task is to bring about a European New Deal within which our people can breathe, create and live in dignity.
A great opportunity for Europe is about to be born in Greece on 25th January. An opportunity Europe can ill afford to miss.
http://syriza.net.gr/index.php/en/pressroom/253-open-letter-to-the-german-readers-that-which-you-were-never-told-about-greece
Most of you, dear Handesblatt readers, will have formed a preconception of what this article is about before you actually read it. I am imploring you not to succumb to such preconceptions. Prejudice was never a good guide, especially during periods when an economic crisis reinforces stereotypes and breeds biggotry, nationalism, even violence.
In 2010, the Greek state ceased to be able to service its debt. Unfortunately, European officials decided to pretend that this problem could be overcome by means of the largest loan in history on condition of fiscal austerity that would, with mathematical precision, shrink the national income from which both new and old loans must be paid. An insolvency problem was thus dealt with as if it were a case of illiquidity.
In other words, Europe adopted the tactics of the least reputable bankers who refuse to acknowledge bad loans, preferring to grant new ones to the insolvent entity so as to pretend that the original loan is performing while extending the bankruptcy into the future. Nothing more than common sense was required to see that the application of the 'extend and pretend' tactic would lead my country to a tragic state. That instead of Greece's stabilization, Europe was creating the circumstances for a self-reinforcing crisis that undermines the foundations of Europe itself.
My party, and I personally, disagreed fiercely with the May 2010 loan agreement not because you, the citizens of Germany, did not give us enough money but because you gave us much, much more than you should have and our government accepted far, far more than it had a right to. Money that would, in any case, neither help the people of Greece (as it was being thrown into the black hole of an unsustainable debt) nor prevent the ballooning of Greek government debt, at great expense to the Greek and German taxpayer.
Indeed, even before a full year had gone by, from 2011 onwards, our predictions were confirmed. The combination of gigantic new loans and stringent government spending cuts that depressed incomes not only failed to rein the debt in but, also, punished the weakest of citizens turning people who had hitherto been living a measured, modest life into paupers and beggars, denying them above all else their dignity. The collapse of incomes pushed thousands of firms into bankruptcy boosting the oligopolistic power of surviving large firms. Thus, prices have been falling but more slowly than wages and salaries, pushing down overall demand for goods and services and crushing nominal incomes while debts continue their inexorable rise. In this setting, the deficit of hope accelerated uncontrollably and, before we knew it, the 'serpent's egg' hatched – the result being neo-Nazis patrolling our neighbourhoods, spreading their message of hatred.
Despite the evident failure of the 'extend and pretend' logic, it is still being implemented to this day. The second Greek 'bailout', enacted in the Spring of 2012, added another huge loan on the weakened shoulders of the Greek taxpayers, "haircut" our social security funds, and financed a ruthless new cleptocracy.
Respected commentators have been referring of recent to Greece's stabilization, even of signs of growth. Alas, 'Greek-covery' is but a mirage which we must put to rest as soon as possible. The recent modest rise of real GDP, to the tune of 0.7%, signals not the end of recession (as has been proclaimed) but, rather, its continuation. Think about it: The same official sources report, for the same quarter, an inflation rate of -1.80%, i.e. deflation. Which means that the 0.7% rise in real GDP was due to a negative growth rate of nominal GDP! In other words, all that happened is that prices declined faster than nominal national income. Not exactly a cause for proclaiming the end of six years of recession!
Allow me to submit to you that this sorry attempt to recruit a new version of 'Greek statistics', in order to declare the ongoing Greek crisis over, is an insult to all Europeans who, at long last, deserve the truth about Greece and about Europe. So, let me be frank: Greece's debt is currently unsustainable and will never be serviced, especially while Greece is being subjected to continuous fiscal waterboarding. The insistence in these dead-end policies, and in the denial of simple arithmetic, costs the German taxpayer dearly while, at once, condemning to a proud European nation to permanent indignity. What is even worse: In this manner, before long the Germans turn against the Greeks, the Greeks against the Germans and, unsurprisingly, the European Ideal suffers catastrophic losses.
Germany, and in particular the hard-working German workers, have nothing to fear from a SYRIZA victory. The opposite holds. Our task is not to confront our partners. It is not to secure larger loans or, equivalently, the right to higher deficits. Our target is, rather, the country's stabilization, balanced budgets and, of course, the end of the grand squeeze of the weaker Greek taxpayers in the context of a loan agreement that is simply unenforceable. We are committed to end 'extend and pretend' logic not against German citizens but with a view to the mutual advantages for all Europeans.
Dear readers, I understand that, behind your 'demand' that our government fulfills all of its 'contractual obligations' hides the fear that, if you let us Greeks some breathing space, we shall return to our bad, old ways. I acknowledge this anxiety. However, let me say that it was not SYRIZA that incubated the cleptocracy which today pretends to strive for 'reforms', as long as these 'reforms' do not affect their ill-gotten privileges. We are ready and willing to introduce major reforms for which we are now seeking a mandate to implement from the Greek electorate, naturally in collaboration with our European partners.
Our task is to bring about a European New Deal within which our people can breathe, create and live in dignity.
A great opportunity for Europe is about to be born in Greece on 25th January. An opportunity Europe can ill afford to miss.
http://syriza.net.gr/index.php/en/pressroom/253-open-letter-to-the-german-readers-that-which-you-were-never-told-about-greece
Syriza Official Vows to Kill EU-US Trade Deal as 'Gift to All European People'
Threat comes amid continued grassroots opposition to proposed trade deal
An official with Greece's newly elected Syriza party may have sounded the death knell for a proposed EU-U.S. trade deal that has faced a mountain of opposition from civil society.
The deal is the Transatlantic Trade and Investment Partnership (TTIP), now facing its eighth round of talks between negotiators this week in Brussels.
The TTIP, which would be the biggest trade deal ever, has been criticized as a corporate-friendly deal that threatens food and environmental safety under the guise of "harmonization" of regulations.
Georgios Katrougkalos, now deputy minister for administrative reform, confirmed what he had told EurActiv Greece ahead of his Syriza party's victory last week: that his parliament would not ratify the trade deal.
"I can ensure you that a Parliament where Syriza holds the majority will never ratify the deal. And this will be a big gift not only to the Greek people but to all the European people," EurActiv reported Monday.
Because Syriza's coalition partner also appears to share the anti-TTIP views, EurActiv reports, this means the Greeks could issue a veto, thereby threatening to block the deal.
Among Katrougkalos' concerns with the trade deal, shared by many of the deal's critics, is the Investor-State Dispute Settlement (ISDS) mechanism. As author Glyn Moody explained, it "enables companies to sue for alleged losses caused by government actions." He adds:
Several European organizations are mobilizing to show their opposition to the trade deal during this latest round of negotiations.
Among them is Friends of the Earth Europe, which plans to hold a demonstration Wednesday to highlight how the TTIP is a "Trojan treaty."
Also joining the demonstration is Guy Taylor, trade campaigner for Global Justice Now and an organizer for actions Wednesday, who said in a statement: "It’s unheard of to see so many people traveling to Brussels to lobby their MEPs like this, and that’s testament to just how hugely controversial and unpopular TTIP has become. David Cameron waxes lyrical about national sovereignty, but in pushing for this deal he is willfully handing sovereignty to big business. The deal is not really about trade, it’s about entrenching the position of the one percent. It should be abandoned."
Underscoring similar concerns is 31-year-old Ross Mackay, who will be joining the actions in Brussels. He told the Scotland Herald, "TTIP is not really about opening up trade and harmonizing tariffs and regulations; it's about a race to the bottom, locked-in privatization, and a seismic shift in power away from people and their elected governments towards corporations."
Why we're protesting against TTIP | Herald Scotland
Threat comes amid continued grassroots opposition to proposed trade deal
An official with Greece's newly elected Syriza party may have sounded the death knell for a proposed EU-U.S. trade deal that has faced a mountain of opposition from civil society.
The deal is the Transatlantic Trade and Investment Partnership (TTIP), now facing its eighth round of talks between negotiators this week in Brussels.
The TTIP, which would be the biggest trade deal ever, has been criticized as a corporate-friendly deal that threatens food and environmental safety under the guise of "harmonization" of regulations.
Georgios Katrougkalos, now deputy minister for administrative reform, confirmed what he had told EurActiv Greece ahead of his Syriza party's victory last week: that his parliament would not ratify the trade deal.
"I can ensure you that a Parliament where Syriza holds the majority will never ratify the deal. And this will be a big gift not only to the Greek people but to all the European people," EurActiv reported Monday.
Because Syriza's coalition partner also appears to share the anti-TTIP views, EurActiv reports, this means the Greeks could issue a veto, thereby threatening to block the deal.
Among Katrougkalos' concerns with the trade deal, shared by many of the deal's critics, is the Investor-State Dispute Settlement (ISDS) mechanism. As author Glyn Moody explained, it "enables companies to sue for alleged losses caused by government actions." He adds:
Several European organizations are mobilizing to show their opposition to the trade deal during this latest round of negotiations.
Among them is Friends of the Earth Europe, which plans to hold a demonstration Wednesday to highlight how the TTIP is a "Trojan treaty."
Also joining the demonstration is Guy Taylor, trade campaigner for Global Justice Now and an organizer for actions Wednesday, who said in a statement: "It’s unheard of to see so many people traveling to Brussels to lobby their MEPs like this, and that’s testament to just how hugely controversial and unpopular TTIP has become. David Cameron waxes lyrical about national sovereignty, but in pushing for this deal he is willfully handing sovereignty to big business. The deal is not really about trade, it’s about entrenching the position of the one percent. It should be abandoned."
Underscoring similar concerns is 31-year-old Ross Mackay, who will be joining the actions in Brussels. He told the Scotland Herald, "TTIP is not really about opening up trade and harmonizing tariffs and regulations; it's about a race to the bottom, locked-in privatization, and a seismic shift in power away from people and their elected governments towards corporations."
Why we're protesting against TTIP | Herald Scotland
Historically speaking, Germany a bigger deadbeat than Greece
Germany's debt defaults after the two world wars dwarfs anything Greece has done, economists say
In its attempt to bust the austerity shackles that lenders have imposed, Greece's new leftist government is finding a particularly unsympathetic ear in Germany, the European Union's paymaster, which says it is done writing off Greek debt.
That warning from German Chancellor Angela Merkel and others is overwhelmingly backed by a German public outraged by the contrast between Greece's spendthrift ways, with its penchant for treating tax bills as junk mail, and their own obsession with a tight hold on the purse strings, both personal and as a country.
What the Germans are conveniently ignoring is their own record as one of history's biggest deadbeats.
In the 1920s, according to a prominent German economic historian, Germany was "like Greece on steroids." Albrecht Ritschl, a professor at the London School of economics and an adviser to the German ministry of economics, says that Germany's current prosperity was built on borrowed — mostly American — money, much of it written off.
It all started in 1918 when Germany lost the First World War. In the peace settlement that followed, the victors exacted payment of 269 billion marks or 96,000 tonnes of gold.
Mirroring the Greeks' current sentiments regarding debt repayment and forced austerity, Germans after WWI saw the reparations as a national humiliation and rejected the validity of that Versailles Treaty.
They did pay, though. But they made their payment by printing ever more money, which led to the kind of hyperinflation where money was carried around in suitcases.
By 1923, one U.S. dollar was worth billions of marks. In Berlin, a streetcar ticket cost 15 billion marks.
The collapse of the German economy led to the demise of the country's Weimar Republic democracy and the rise of Adolf Hitler, who promptly stopped the payments once he came to power.
In 1947, the U.S. Congress voted $13 billion in aid to the Europeans, a massive sum at the time. A British politician of the day called it "a lifeline to sinking men."
The Germans got $1.45 billion of that money. They were also allowed to put off paying, and indeed never did fully repay, the money they already owed to other Europeans as well as the Americans.
Taken alongside the default after WWI, this makes Germany the biggest debt transgressor of the 20th century, says Ritschl.
Of course, for all the Marshall Plan largesse, Germany deserves credit for the skills and discipline its people showed, which enabled it to recover — in what came to be called an economic miracle — faster than its neighbours.
As for the money they owed, in 2010 the Germans made a last payment of 69.9 million euros to settle all their debts from both world wars. That settlement, though, was more symbolic than real as the original debt was repeatedly reduced over the decades.
In addition, and of particular relevance to the political drama surrounding the current crisis, is that, according to the Greeks, Germany never repaid Greece the equivalent of 476 million reichmarks for an interest-free loan that Nazi Germany forced on them during the Second World War.
more
Historically speaking, Germany a bigger deadbeat than Greece - World - CBC News
Germany's debt defaults after the two world wars dwarfs anything Greece has done, economists say
In its attempt to bust the austerity shackles that lenders have imposed, Greece's new leftist government is finding a particularly unsympathetic ear in Germany, the European Union's paymaster, which says it is done writing off Greek debt.
That warning from German Chancellor Angela Merkel and others is overwhelmingly backed by a German public outraged by the contrast between Greece's spendthrift ways, with its penchant for treating tax bills as junk mail, and their own obsession with a tight hold on the purse strings, both personal and as a country.
What the Germans are conveniently ignoring is their own record as one of history's biggest deadbeats.
In the 1920s, according to a prominent German economic historian, Germany was "like Greece on steroids." Albrecht Ritschl, a professor at the London School of economics and an adviser to the German ministry of economics, says that Germany's current prosperity was built on borrowed — mostly American — money, much of it written off.
It all started in 1918 when Germany lost the First World War. In the peace settlement that followed, the victors exacted payment of 269 billion marks or 96,000 tonnes of gold.
Mirroring the Greeks' current sentiments regarding debt repayment and forced austerity, Germans after WWI saw the reparations as a national humiliation and rejected the validity of that Versailles Treaty.
They did pay, though. But they made their payment by printing ever more money, which led to the kind of hyperinflation where money was carried around in suitcases.
By 1923, one U.S. dollar was worth billions of marks. In Berlin, a streetcar ticket cost 15 billion marks.
The collapse of the German economy led to the demise of the country's Weimar Republic democracy and the rise of Adolf Hitler, who promptly stopped the payments once he came to power.
In 1947, the U.S. Congress voted $13 billion in aid to the Europeans, a massive sum at the time. A British politician of the day called it "a lifeline to sinking men."
The Germans got $1.45 billion of that money. They were also allowed to put off paying, and indeed never did fully repay, the money they already owed to other Europeans as well as the Americans.
Taken alongside the default after WWI, this makes Germany the biggest debt transgressor of the 20th century, says Ritschl.
Of course, for all the Marshall Plan largesse, Germany deserves credit for the skills and discipline its people showed, which enabled it to recover — in what came to be called an economic miracle — faster than its neighbours.
As for the money they owed, in 2010 the Germans made a last payment of 69.9 million euros to settle all their debts from both world wars. That settlement, though, was more symbolic than real as the original debt was repeatedly reduced over the decades.
In addition, and of particular relevance to the political drama surrounding the current crisis, is that, according to the Greeks, Germany never repaid Greece the equivalent of 476 million reichmarks for an interest-free loan that Nazi Germany forced on them during the Second World War.
more
Historically speaking, Germany a bigger deadbeat than Greece - World - CBC News
Germany rejects Greek claim for World War Two reparations
Germany said on Monday there was "zero" chance of it paying World War Two reparations to Athens, following a renewed demand from Greece's new leftist Prime Minister Alexis Tsipras.
Tsipras, in his first major speech to parliament on Sunday, laid out plans to dismantle Greece's austerity program, ruled out any extension of its 240 billion euro international bailout and vowed to seek war reparations from Berlin.
The demand for compensation, revived by a previous Greek government in 2013 but not pursued, was rejected outright by Sigmar Gabriel, Germany's vice chancellor and economy minister.
"The probability is zero," said Gabriel, when asked if Germany would make such payments to Greece, adding a treaty signed 25 years ago had wrapped up all such claims.
Germany and Greece share a complex history that has complicated the debt debate. Greece was occupied by German troops in World War Two, an issue that has resurfaced since it has been forced to endure tough reforms in return for a financial bailout partly funded by euro zone partners.
Many Greeks have blamed euro zone heavyweight Germany for the austerity, leading to the revival of a dormant claim against Berlin for billions of euros of war reparations.
As part of a wider appeal to Europe for solidarity, Greece's new finance minister has suggested a parallel between his country and the rise of Nazism in a bankrupt Germany in the 1930s, referring to Greece's far-right Golden Dawn party.
Gabriel referred to the "Treaty on the Final Settlement with respect to Germany", also known as the "Two plus Four Treaty" signed in September 1990, by the former West and East Germanys and the four World War Two allies just before German reunification.
Under its terms, the four powers renounced all rights they formerly held in Germany. For Berlin, the document, also approved by Greece among other states, effectively drew a line under possible future claims for war reparations.
Germany thus denies owing anything more to Greece for World War Two after the 115 million deutsche marks it paid in 1960, one of 12 war compensation deals it signed with Western nations.
But Athens has said it always considered that money as only an initial payment, with the rest of its claims to be discussed after German reunification, which eventually came in 1990.
Germany rejects Greek claim for World War Two reparations | Reuters
Germany said on Monday there was "zero" chance of it paying World War Two reparations to Athens, following a renewed demand from Greece's new leftist Prime Minister Alexis Tsipras.
Tsipras, in his first major speech to parliament on Sunday, laid out plans to dismantle Greece's austerity program, ruled out any extension of its 240 billion euro international bailout and vowed to seek war reparations from Berlin.
The demand for compensation, revived by a previous Greek government in 2013 but not pursued, was rejected outright by Sigmar Gabriel, Germany's vice chancellor and economy minister.
"The probability is zero," said Gabriel, when asked if Germany would make such payments to Greece, adding a treaty signed 25 years ago had wrapped up all such claims.
Germany and Greece share a complex history that has complicated the debt debate. Greece was occupied by German troops in World War Two, an issue that has resurfaced since it has been forced to endure tough reforms in return for a financial bailout partly funded by euro zone partners.
Many Greeks have blamed euro zone heavyweight Germany for the austerity, leading to the revival of a dormant claim against Berlin for billions of euros of war reparations.
As part of a wider appeal to Europe for solidarity, Greece's new finance minister has suggested a parallel between his country and the rise of Nazism in a bankrupt Germany in the 1930s, referring to Greece's far-right Golden Dawn party.
Gabriel referred to the "Treaty on the Final Settlement with respect to Germany", also known as the "Two plus Four Treaty" signed in September 1990, by the former West and East Germanys and the four World War Two allies just before German reunification.
Under its terms, the four powers renounced all rights they formerly held in Germany. For Berlin, the document, also approved by Greece among other states, effectively drew a line under possible future claims for war reparations.
Germany thus denies owing anything more to Greece for World War Two after the 115 million deutsche marks it paid in 1960, one of 12 war compensation deals it signed with Western nations.
But Athens has said it always considered that money as only an initial payment, with the rest of its claims to be discussed after German reunification, which eventually came in 1990.
Germany rejects Greek claim for World War Two reparations | Reuters
The only way Greece can reestablish a vibrant economy is the DITCH the dictates of Austerity. The whole program imposes a downward spiral on its productive capacity. The EU economy is inundated with inertia, pessimism, integral disequilibrium and structural disassembly. Greece is only the start of a predatory agenda that will eat into its centre. It benefits ONLY financial and trading interests.
Europe has failed. Free Trade, Free Markets, Monetarism..... the Euro have all FAILED and its time for countries like Greece to bail out and reestablish a sovereign currency and a integrated industrial and agricultural economy.
It's coming here to Canada. Austerity and capitulation to the dictates of Supranational agencies (IMF, WTO, World Bank) and corporations are behind our economic policies now. Standing up for the nation can't happen as long as we are governed by fools, weaklings and quislings like Harper. I just don't see anyone who is willing to as yet.
Europe has failed. Free Trade, Free Markets, Monetarism..... the Euro have all FAILED and its time for countries like Greece to bail out and reestablish a sovereign currency and a integrated industrial and agricultural economy.
It's coming here to Canada. Austerity and capitulation to the dictates of Supranational agencies (IMF, WTO, World Bank) and corporations are behind our economic policies now. Standing up for the nation can't happen as long as we are governed by fools, weaklings and quislings like Harper. I just don't see anyone who is willing to as yet.
Greece Begins The Great Pivot Toward Russia
Ten days ago, before the smashing success of Greece's anti-austerity party, Syriza, we noted that Russia gave Greece a modest proposal: turn your back on Europe, whom you despise so much anyway, and we will assist your farmers by lifting the food import ban.
And, sure enough, Greece's new premier Tsipras did hint with his initial actions that Greece may indeed pivot quite aggressively away from Europe and toward Russia in general and the Eurasian Economic Union in particular (as a tangent recall "Russia's "Startling" Proposal To Europe: Dump The US, Join The Eurasian Economic Union").
http://www.zerohedge.com/news/2015-01-27/greece-begins-great-pivot-toward-russia
Ten days ago, before the smashing success of Greece's anti-austerity party, Syriza, we noted that Russia gave Greece a modest proposal: turn your back on Europe, whom you despise so much anyway, and we will assist your farmers by lifting the food import ban.
And, sure enough, Greece's new premier Tsipras did hint with his initial actions that Greece may indeed pivot quite aggressively away from Europe and toward Russia in general and the Eurasian Economic Union in particular (as a tangent recall "Russia's "Startling" Proposal To Europe: Dump The US, Join The Eurasian Economic Union").
http://www.zerohedge.com/news/2015-01-27/greece-begins-great-pivot-toward-russia
Greek bailout crisis: Athens threatens to seize German assets 'as compensation for Nazi war crimes' - Europe - World - The Independent
A little desperate it would seem.
However typical of a socialist country... become unsustainable and then resort to seizing other people's assets... typically capitalist assets.
A little desperate it would seem.
However typical of a socialist country... become unsustainable and then resort to seizing other people's assets... typically capitalist assets.
Might be the best thing to happen for the EU... Greece can unilaterally seize assets from the Germans for war crimes, then onto seizing assets from Italy in retribution for the hardships by the Romans.
Yep, a silly move like this will see not one more penny entering Greece from the West.... Maybe they can make a deal with Russia, it's worked out so well for the Ukraine.. What could possibly go wrong?
Further checking found that German assets in Greece do not amount to much and that Greece and Germany already settled the WWII matter through some sort of agreement 25 years ago.
Greece's socialist party is in somewhat of a quagmire.
The argument is ridiculous to begin with.... Honestly, the Greeks have a rich history of conquering many nations throughout (contemporary) Europe. This is all highly documented, so what is stopping anyone else from demanding reparations from those events thousands of years ago?
Ultimately, the Greeks voted in a bunch of entitled wannabes that have some fantasy that the rest of Europe owes them a free ride
Great point! Imagine Greece having to pay for reparations from Egypt to India!
And they will fail.
Sure is an odd negotiating tactic: first refusing to pay and later threatening to confiscate assets of the very nation that they need cash from.
This won't end well for the average Greek citizen
This won't end well for the average Greek citizen