Democracy, delusions and TIFKATT
This week Greece moved one step closer to ‘Grexit’ – defaulting on its debts and, probably, leaving the Euro. After much wrangling, TIFKATT (The Institutions Formerly Known As The Troika) presented a unified list of requirements to the Greek government. This provoked what can only be described as a hissy fit from Alexis Tsipras, the prime minister. Under pressure from his own party, he said that Greece would miss a €300m payment to the IMF due tomorrow.
Greece can probably find the money if it wants to. Their government is making a point, taking the brinksmanship to the next level. Who will blink first? The European Commission is desperate to avoid calamity befalling the Euro and, more widely, the European Union’s progress. The IMF is more steely. Of course, Greece would not be the first country to miss payments to the IMF. They would join such illustrious company as Iraq, Haiti and Zimbabwe. Closer to home, Bosnia & Herzegovina and Yugoslavia have also been in arrears – but surely proud Greece, the cradle of democracy, was meant to be better than these shattered Balkan remnants?
Greece’s pioneering democratic heritage, the country of Plato and Socrates, is one of the reasons the country was admitted to the Euro in the first place. Tsipras now invokes his election victory as a mandate for rejecting TIFKATT’s requirements. He complains that creditors are “displaying a total indifference to the recent democratic choice of the Greek people.” Similar arguments were made by the Scottish National Party last year. They insisted an 18-month timetable for independence was not just realistic but required if the Scottish people voted to leave the UK. I explored some of the similarities in my blog ‘Currency Brinksmanship: The Parallels’. As we know, Scotland stepped back from the brink. Let’s hope Greece does too.
© Patrick Macdonald 2015