The Greek people have found themselves assailed from all sides to pay for a crisis of someone else’s making. They have protested in their hundreds of thousands against the austerity programme of cuts, mass redundancies and the fire sale of state assets, the proceeds of which would end up in the pockets of banks and bond holders.
A line-up of pundits and economists blithely playing the role of perverse doctors, declare that the Greeks will have to take ten years of pain to pay for the crisis. They point to the corrupt hiring practices for government posts, state ownership, tax avoidance as reasons for the Greek predicament.
What they don’t explain is, why in that case did the Celtic Tiger of Ireland collapse into near bankruptcy? Neither do they explain why the austerity demands would work for Greece whereas in Ireland, those policies have lead to a destruction of the growth that would have paid for its debts. They are strangely silent on the example of Ireland, which has done everything the ECB and the IMF demanded of it. In a sign that the Irish crisis is set to deepen, the Allied Irish Banks, one of the bailed out banks, has defaulted.
The Greek crisis is poised as a Mexican standoff between the Greek masses, the bond holders and banks, the CDS market, the IMF/ECB and their proxy, Greek PM George Papandreou.
George Papandreou has won his vote of confidence today and it is likely that he will be able to get a new austerity package through parliament. This will only be the first step, but as the Greek masses have made absolutely clear, the final say rests with them.