Destroy Greece: ΙMF and Europe agree now on the method

09/04/2016

ΙMF-EU-Greece: Small crimes among friends

Who is with whom and against whom in the final episode of Greek thriller

Yannis Kibouropoulos, journalist

Another episode of the six-year Greek thriller played in early April between Athens, Brussels and Washington. The reason this time was a leaking through WikiLeaks, a transcribed telephone conversation between IMF staff that is responsible for the surveillance of Greece to implement the Memorandum III, signed by the government of SYRIZA-ANEL. In their telephone conversation the IMF staff (Thomsen, Velkuleskou and Petrova) issue known and publicly formulated IMF’s positions as regards how it understands the balance between the new austerity measures the Greek government should take up in 2018 (between 5.4 billion EUR asked by Europeans and 9 billion EUR requesting by IMF) and the securing of the Greek debt sustainability through deep restructuring measures.

The element of conversation that caused a stir was the mention of Paul Thomsen, head of the European Department of the IMF, to the possibility of a credit event, the pressure of which the Greek government could accept more austerity measures. The practice of “waterboarding” described by Thomsen essentially has many times applied in Greece which lives under Memoranda at last six years. This method not only characterizes the IMF. Conversely, the European institutions rather pioneered the utilization of this method, with leading example the blackmail exerted after “NO” in Greek referendum of July, which led to the tragic capitulation of SYRIZA-ANEL government and Alexis Tsipras.

By all indications so far, the incident is considered closed and the efforts of Greek government to seize as an extrusion-tool for the withdrawal of IMF from Greek program led to failure. Merkel and Lagarde declared publicly the stay of the IMF in Greek program, and their general agreement to require by the government of SYRIZA-ANEL the full implementation of austerity measures which provides Memorandum III. Individual disagreements between IMF and Europeans regarding the exact dosage of austerity recorded as a «footnote» in the first assessment of the Memorandum III, but do not reverse the extreme and international scale character of the neoliberal experiment in Greece, which is now run by a government that defines itself as Left.

The last episode of Greek thriller is a characteristic of the confusion strategy in which is the Greek government and generally the European left. In 15 months of governance, but also to the two years course for government, the leadership of SYRIZA and the SYRIZA-ANEL government spun around conflicting assessments and analyzes of the specific roles of the IMF and European centers of power.

During the pre-election period, the “Merkelism” was for SYRIZA the expression of absolute “evil” in the Europe of austerity. By contrast, the European Central Bank (ECB) handled as an ally of people against the austerity when it launched its own QE program, which was flooded with cheap money the “financial Leviathan”, reproducing the main cause of the crisis of 2007-2008. The IMF respectively presented as unmentionable friend of Greek government when, on the eve of the July 2015 referendum, released its report on the Greek debt that characterized unsustainable without deep restructuring. Then the IMF became the exponent of the absolute “evil”, when demanded additional austerity measures if Europeans lenders exclude the nominal haircut of debt.

In general, the government of SYRIZA-ANEL, like the other Greek governments under the Memoranda I and II, absolutize whenever the existent disputes, possibly also the contradictions between European “Priesthood” and the IMF. Their first fundamental mistake was the failure to understand that the Eurozone – IMF alliance is strategic and there will be regardless of whether the IMF will remain or not in the Greek Memorandum ΙΙΙ. The IMF, the FED, the ECB, the large central banking system, the EU with its complex institutions, the G7, the G20, NATO are subsets of a larger mechanism of “global governance” in our capitalist universe. They have their particular roles, disagreements and contradictions, but are sworn to the common «neoliberal credo».

The “outsourcing” of the IMF in Europe became necessary when the European leadership, in response to the Greek debt crisis, wanted to gain time to build its own mechanisms and banking rules and government bailouts. That happened with the Treaty on the ESM and also with the Banking Union. On transfer of the IMF’s expertise, however, they found significant inconsistencies due to the peculiarities of the Eurozone. The IMF acts as a guarantor of international, usury financial capital on behalf of more than 180 countries that are donors, with American hegemony within as indisputable until today. When IMF “invades” into a country to demolish by austerity the economic and social structure, public wealth, social protection systems has tremendous autonomy. Essentially, the IMF is unaccountable to nobody. The “European IMF”, however, envisioned by the leaders of the Eurozone, is going through complex, collective and national approval procedures. So that the German Bundestag often emerging as a “final judge” of bailout for EU member states. It would take a radical reform of the European Treaties so that the ESM or any other European institution to have the “power of life and death” in one country that already has the IMF. Hence the insistence of the German leadership to keep the IMF with all costs at the Greek Memorandum.

These differences at technocratic culture between IMF and Eurozone reflected the tensions often encountered in the last six years between the two poles, with a focus on debt sustainability criteria. The IMF puts forward the strict criteria of its statute because he wants to force European lenders to put their hand deeper in their pocket. And Europeans, just because they do not want to pay more, adopt looser sustainability criteria. However, these accounting contradictions never will lead to a strategic rupture between these two pillars- and the Greek government fails to understand this elementary thing. All these always settled with compromises, as happened in 2012, when the IMF imposed an active- but disastrous for the Greek banking system and the Greek State- haircut of Greek debt, with the PSI, which was necessary to appease the “monster” of the markets, which threatened to collapse the Eurozone.

A similar compromise is expected now. Actually, it is imposed by the common Euro- atlantic concern for a new recession cycle in the global capitalist economy, as well as the geopolitical chaos in the Middle East which fueled the refugee crisis. The IMF made its preparation by announcing earlier this year the beginning of new criteria for its participation in large state bailouts, giving Eurozone a maneuver with a mild, minimum cost of restructuring the Greek debt, which would perpetuate the status of «debt colony», although with somewhat lower annual costs.

There is also a further motivation to the Euro-Atlantic compromise for Greek thriller, which is obvious from the constant American intervention in favor of the stay of IMF in Greek Memorandum. This motivation is not economic, but geopolitical. The SYRIZA-ANEL government has agreed to make Greece the mound of refugee flows from Turkey, on the basis of a Euro-Turkish agreement which brutally violates international law and in practice is an agreement exclusively between Greece and Turkey. But the implementation of this agreement depends on the unpredictable and uncontrollable government of Erdogan, which has an independent strategy in the Syrian problem and much more to the Kurdish issue. This strategy collides with the options (opportunistic or constant) alliances of USA in the region. A possible USA rift with the Turkish regime in these crucial fields blows up the Euro-Turkish agreement and inevitably makes the Greece a receptor of massive refugee flows. If Turkey from a staunch ally of USA becomes an unpredictable enemy then, Greece becomes the non-negotiable eastern border, not only for the EU but also for NATO. A Greece in multiple – economic, geopolitical, defensive- pressure, it will become easier a Euro- Atlantic protectorate.

http://www.defenddemocracy.press/syriza-imf-eu-gambling-future-greece/