Late in August, I posted this piece saying that – whatever rhetoric was flying between Berlin-am-Brussels – there was a deal on the table and both sides wanted it. I was confident in my sources, and I still am. But what I suspect my sources overestimated was the quality of the deal from a Greek point of view.
Greek Finance Minister Yannis Stournaras told the Athens Parliament today that he’d “hammered out a deal” for a loan agreement that gave the country a two-year extension to meet its budget targets in exchange for deep budget cuts.
Whatever the eunatics say, it is a compromise. But on reading the details late last night, my first thought was, ‘Is that it?’
If the demand on the table is that one flies to Jupiter and back unaided by June 2013, and then suddenly the new deal is that you fly to Saturn and back by October 2015, does it help the situation? Call me wacky, but I’d say “No” emphatically.
Greece’s economy, now in its fifth year of contraction, is expected to shrink more than 6% this year and 4.5% next year.
Only an idiot or a sociopathic schemer would suggest that things will be on the mend by 2015. Barroso and Van Rompuy are idiots, but Schäuble and Merkel aren’t. Frankly, I’d be amazed if Greece can last until Spring 2013 without the need for another major bailout.
I don’t know what Antonis Samaras is thinking about tonight, but I have a reasonable idea what Athenian political circles are discussing. I fancy the main topic around power-dinner tables there will be this: the Prime Minister has come out of this largely empty-handed. What does he do now?
The answer has to be “Something very big, and very soon”. There will be more unrest, more police clashes, more hubris from Golden Dawn, and more shrewd analysis from Syriza’s leader Alexis Tsipras. Fatboy Venizelos – the last idiot to leave the Coalition bunker – will convince himself that a gesture of last-minute distancing will help him survive. But the fact remains that the Democratic Left has already gone, and as predicted here eight days ago – Prime Minister Samaras is looking to much grander gestures.
These may well prove to be delusions of grandeur, but Samaras is looking for a new Grand Coalition. So many people are feeding back this line to me now, it seems impossible to think it is merely disinformation bollocks.
Stay tuned. This is could easily turn into an anarchic circus sooner rather than later.