Thursday, 12 February 2015

Options are running out for Greece, but do we want Greece in league with Russia?

The saying is - "beware Greeks bearing gifts". In this case the EU is asking - do we give the Greeks any more gifts? Looking at the Greek financial problems and the consequences of the EU being too kind to its spendthrift neighbour I fear that brinkmanship by the Greeks will scupper any deal. 
“A deal may still be possible but the Greek side will have to move most,” said Guntram Wolff, head of the Bruegel thinktank in Brussels.
As the Guardian reports: It is not only northern German-led fiscal hawks who are resisting the demands of Tsipras. Spain and Portugal, who have also been bailed out and having gone through their own wrenching austerity programmes, show no sign of being generous to the Greeks.
And why should these countries - who have been through the pain - and done the right thing, bail out their neighbour who refuses to 
France and Italy, meanwhile, though broadly sympathetic to an easing of fiscal rigour, have been irritated by Tsipras’ megaphone diplomacy, seen in Brussels and elsewhere as importunate, hubristic and counter-productive. 
For my part I would not be giving the Greeks any money unless they left the straight jacket of the Euro. It is obvious they are incapable of living within their means. So let them quit the euro and devalue their own currency. But, of course, the Greeks do not want that. Even the far left new Greek government still wants the rest of Europe to pay its bills. 

Finally, the father of the House of Commons, Sir Peter Tapsell (aged 85) asked a very good question at PMQs yesterday, underlining the threat of Greece embracing Russia and the return to Cold War satellite states:
Sir Peter Tapsell (Louth and Horncastle) (Con): May I put it to the Prime Minister that from President Monroe onwards it has been generally acknowledged by leaders of great powers that, for the avoidance of war, it is often wise to acknowledge the concept of traditional spheres of authority and power; and that although Ukraine is of absolutely no significant strategic importance to Britain, Greece most certainly is; and that unless western statesmen show rather greater skills than they have in recent years, Greece will pass into the Russian sphere of influence without a shot being fired?

The Prime Minister: It is difficult to answer the Father of the House without a long, historical exegesis, but I would argue that, when it comes to Ukraine, it does matter on our continent of Europe that we do not reward aggression and brutality with appeasement; that would be wrong. That is why it is right to have the sanctions in place, right to keep the European Union and America together on the issue, and right to stand up to President Putin. On Greece, of course there is a British interest, which is that we want stability and growth on the continent of Europe. The eurozone crisis has held that growth and stability back; we want those concerned to come to a reasonable agreement so that Europe can move forward. It is good that the British economy is growing and jobs are being generated, but we have to recognise that our largest market at the moment is still relatively stagnant, and the situation in Greece does not help that.