Faced with the super bailout and capitulation of Tsipras

The capitulation of the neo-left Tsipras government to the creditors and partners is clearly reflected in the 7,500-page…

Faced with the super bailout and capitulation of Tsipras | tovima.gr

The capitulation of the neo-left Tsipras government to the creditors and partners is clearly reflected in the 7,500-page ‘super bailout’ that is being debated in Parliament since Thursday is expected to be triumphantly approved by the whole 153 MPs of the anti-bailout SYRIZA-Independent Greeks majority on Sunday evening.

The omnibus bill tabled by the government has everything. There is no area left unaffected, no creditor demand or request left unaddressed.

On the fiscal side of things, taxes on all forms of property dominate, all potential production cows are being “milked” to death, as an affected micro-brewer recently told To Vima, the ENFIA tax is being reformed and fortified, meager earners are further burdened, while high earners will see the Tax office as a partner. Even gainful employment is almost treated like a sin. More so if someone with skills and an education manages to make a successful career in the private sector of the economy. Even cars offered by businesses for daily use are treated as a benefit, which is taxed over 50%.

Likewise, in expenses, the pensions will be slashed in spite of that the propaganda of the Labor Minister and newbie SYRIZA MPs who treat EKAS beneficiaries as criminals.

There is no shortage of provisions to control expenses, the highlight being the contingency mechanism for limiting expenses to within the framework of the bailout program.

The fiscal adjustment mechanism is the epitome of imposing balanced budgets perpetually, an ultra liberal choice that is as far away as you can get from leftist thinking.

The ideological turn and stripping of the anti-bailout government though is reflected in the issues related to state assets and privatizations.

The Tsipras government agreed to make all state assets available to the new super fund that is controlled by the country’s creditors and partners. It is making all state companies ready for sale or privatization, even emblematic ones, such as the water and urban transportation companies, for which the government had previously made promises and fought endless battles.

The compromise for all loans, not just non-performing ones, cannot go unnoticed. Now they can all be sold off to special management companies from abroad, which will also undertake the burden of restructuring the private sector, without emotion or national reservations.

Truth be told, the bill tabled by Tsipras is the result of a profound political impasse, that was attempted twice: once last summer with the referendum and retreat in the historic summit and once now, after the long and supposedly heroic negotiation.

Above all it remains a monument of unreliability and solid proof of the end of delusions and obsessions that dominated the Left during the crisis, particularly the Left in the streets, that did not leave sidewalk for sidewalks, brutally attacked everyone and was adopted by Tsipras and SYRIZA, who now claim they do not know who are behind the tear gas masks and hoods.

Despite this, the unprecedented turn of Tsipras, which obviously came under the weight of the major responsibility for the country, is significant and on a political level highly interesting. The Prime Minister, bearing the responsibility for the country, could not jeopardize Greece’s European future for a second time within a year. He had no other choice and choice to assume the political cost. He is now counting on “winning over” the foreigners, that he will receive a promise for a generous debt relief – the talks are advanced and in-depth this time, as confirmed by the Governor of the Bank of Greece Yannis Stournaras – and is looking forward to reaping the benefits of Greece returning to normality.

Faced with an absolute impasse, just like his predecessors, he was convinced that a rescue attempt would be preferable to a catastrophic leap. So he “bought” an agreement with an incalculable political cost and can now show off his “sacrifice” he made for the country to his opponents. Of course he continues to fly the faded banner of the fight against corruption and vested interests, at the same time that he is building his own system, as evident by the many amendments in favor of certain interests and the many dealings between government officials and major entrepreneurs reveal.

It must be said that his choice caused some awkwardness among the opposition parties. The reactions in Parliament against the omnibus bill may have been extreme, but at the some indicative of the frustration within the opposition.

Most within the opposition felt almost betrayed by a renegade. They saw their sworn enemy overcome himself and agree to provisions and reforms that until recently he opposed. They could not believe that Tsipras outdid them, assuming their share if the cost of unreliability, which the entire political system had accumulated at the start and management of the crisis.

Let us be honest. With his delays and populism, Tsipras deeply affected the Greek economy. But unfortunately he is not alone. All parties that governed since 2004 danced along with the sirens of populism and jointly created the conditions for the bankruptcy and long term crisis.

In any case, the political game is shifting.

From now on Tsipras will attempt to play the “savior” and “reformer” of recovery circumstances for the economy and country cards. He will speak about the opportunities for productive reconstruction, he will promise changes to the political system, he will bank on changing the electoral law and review the Constitution, he will accuse the opposition for not supporting what it defended and preached and will try to mediate and manage the measures that he is now taking.

The likeliest scenario is that he “breaks down” on the way and will be unable to honor the agreement that he signed and is now legislating, while surrendering himself to the anger of betrayed voters. However it is not certain that the opposition will dominate.

Those who expect it to be a walk in the park for Mitsotakis are mistaken. The New Democracy leader will have to take a different political approach. He may need to to rebuild the country from scratch. He has a duty to be sufficiently prepared. He will not achieve a thing by investing in populism. The times are complicated and demanding for everyone.

It will be just as difficult for Mitsotakis to convince that has a reliable alternative as it is for Tsipras to implement the agreement he is legislating.

Growth countermeasures

Nothing guarantees that the Prime Minister’s retreat will have the desired result. It is true that the major insecurity and uncertainty regarding the country’s place in Europe will subside and it is likely that at least in the near future, there will be some stability. However there is no shortage of people who believe that the Greek economy will further shrink and retreat with the imposition of new measures. This can turn out to be critical if there are no growth countermeasures, such as by quickly using community funds, or the immediate activation of foreign investors who have undertaking major works, such as the regional airports.

Antonis Karakousis

Originally published in the Sunday print edition

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