Austerity or Democracy

ATHENS/BERLIN (Own report) – At Berlin’s insistence, Greece will not receive debt relief and will be forced to submit – contrary to the Greek population’s “No” last Sunday – to Germany’s austerity dictate, or exit the Eurozone. This is what the Eurogroup decided at its summit yesterday evening. Debt relief, as French Prime Minister Manuel Valls had been still considering yesterday afternoon, is out of the question, announced German Chancellor Angela Merkel following the meeting in Brussels. Athens will also have to present detailed austerity proposals by Thursday. European Commission President Jean-Claude Juncker explicitly declared, “if the Greek government is not doing what we expect” a “Grexit” will be initiated. According to insiders, cash will be available at Greek banks only for another two days. By withholding ECB emergency funding, Greece can be driven into collapse, at any time. Just prior to the summit, leading economists signed an appeal to Chancellor Merkel, asking her to stop the “never-ending austerity” – to no avail. In the meantime, even Washington has intervened in the debate. A special EU summit, convened for Sunday, will take the final decision on Greece’s future.

Greece Gambles On “Catastrophic Armageddon” For Europe, Warns It “Only Has Weeks Of Cash Left”

One of the bigger problems facing the new, upstart Greek government, which has set before itself the lofty goal of overturning 6 years of oppressive European policies and countless generations of Greek cronyism, corruption and tax-evasion is not so much the concern about deposit outflows and bank runs – even though it most certainly will be in the next few days unless the Tsipras government finds some resolution to the dramatic standoff with Merkel and the ECB – but something far more trivial: running out of money.

Recall that two weeks into the Greek elections, Greece was rocked by a dire, if entirely underappreciated development, when its already “tax-paying challenged” population decided to completely hold off paying any taxes in advance hopes that the Tsipras government will “overturn” austerity. We wrote:

… while there will be no official confirmation whether Greece did or did not have a bank run for months, unless of course some bank keels over and dies in the interim, one thing is certain: with an increasing probability they may not have a “continuity-promoting” government in less than two weeks, Greeks tax remittances to the government, which were almost non-existent to begin with, have ground to a halt!