Irrespective of the impressions from the discussion in Parliament on Friday – which were not the best for the government – it became perfectly clear to everyone that the country’s position is not the best.
Despite what the Prime Minister claims, the plan which the government is negotiating is not its own, but rather the troika’s. By all appearances, nothing suggests that there is much room for any significant changes.
Anyone closely following the ongoing negotiations with the partners and creditors for the past years will be aware that there is always some room for change or postponement of certain measures, however there is no chance of any radical change to the plan that Juncker gave Mr. Tsipras.
Perhaps some of the extreme predictions of the troika’s plan may be removed, however the goals, pursuits, overall policies and measures that support them cannot change dramatically, unless they are replaced by others with an equivalent fiscal result. The plan’s structure is such that the sequence of targets and measure do not allow major interventions.
From the moment that Mr. Tsipras accepted the fiscal stability goal and adopted the escalation of primary surpluses over time, there is little chance of any serious changes to this plan.
However, since he remains undecided and is sluggish, as it has been demonstrated, in taking decisions, with his stance he risks extending the already strained climate of uncertainty.
If this carries on much longer, if there are no decisions capable of resulting in a compromise agreement with the partners over the next few days, then situation may get out control of politics.
In any case the situation is critical. It is dangerous, as it is, on its own.
If the belief that we are getting further away from an agreement with the partners prevails, then nobody can safely predict what will happen next.
Everything will depend of the people’s behavior. Should there be a panic, measures to restrict the movement of capital will be triggered, which will in turn affect the banks and cause the European Central Bank to reduce the value of Greek collateral, further exacerbating the liquidity crisis in the Greek economy.
It become clear that in the country’s current situation, not everything is controlled by the politicians. There are many factors – domestic and international, real and psychological – which may come into play.
Such conditions are extremely dangerous for the economic stability and the country’s position.
Unfortunately, based on the speeches of those in power, it follows that they have not quite understood the consequences of what may occur in such situations. Worst of all, most are deluded that the partners will back down, that they will be afraid. They not understand that our partners are gradually forming the belief that “there can be no agreement with the Greeks so “let them do what they want” or, cynically, “let them default”.
In any case the country is experiencing dangerous days. Every action, every move counts. Those in power must understand this first.
Antonis Karakousis
Originally published in the Sunday print edition
