Germany Refuses to Alleviate Greek Burden

Merkel and Hollande
Photo: John Macdougall / AFP

Greece was the focus of a meeting between Angela Merkel and François Hollande on August 23rd. The two main leaders of the European Union discussed Greece’s request to postpone some of the reforms demanded by its creditors in exchange for funding to avoid complete bankruptcy.

The German and French leaders had a dinner before both meeting Greek Prime Minister Antonis Samaras at the end of the week. Samaras just started a tour in Europe to plea for the EU’s understanding regarding the increasingly difficult situation Greece is facing.

Greece has been slightly more stable in the past few months, but social unrest remains prevalent, even now that the country has a stable government. The required reforms destabilize the very foundations of Greek society because the Greek government needs to reorganize itself so dramatically to balance its finances. Reforming a State and its administration with such haste undeniably brings a shock for the whole country.

To benefit from EU aid, Greece must privatize all state companies, while unemployment rates continue to rise.

Interviewed by Le Monde, Samaras asserted that his country was ready to do everything possible and wanted to “erase the idea that Greece is here to be a problem”. He added that, “The only thing we want to stress is that an economic upturn is necessary to achieve our goals. We do not question the purposes of the program. We only want to be sure that we will reach our goals while maintaining social cohesion”.

Indeed, the efforts demonstrated by the Greek people have proven to be fruitless, and the road to economic recovery gets longer every day. Hollande and Merkel demonstrated once again that they agreed on the fact that Greece must remain a member of the EU. However, that might be the only thing on which they agree.

In an effort to persuade Germany that he understood their concerns, Hollande firmly stated that if Greece wants to stay in the EU, it “has to do the unavoidable efforts so that we can achieve this goal”. The French President and his government keep on asserting that budgetary austerity cannot be the one and only solution and that growth, in Greece and in every country of Europe, must be promoted.

Germany is not ready to give Greece the two extra years requested by Samaras to accomplish the necessary reforms. Angela Merkel was very clear: Greece, as well as the European Union, must stick to its obligations. The EU cannot loose the frail trust placed in it by

the markets after years of political and economic turmoil. Above all, Angela Merkel refuses to initiate any kind of renegotiation before the conclusions of the new review of the Greek case by the TROIKA, expected in September.

The German Finance Minister was even firmer with Greece when he said, “more time is not a solution to the problems”. According to him, the EU has used its last available economic resources for the Greek people. The truth is that Greece is not waiting alone in its wait for an economic upturn.

While Germany is less affected, France is still struggling with high unemployment rates and Italy, Spain and Portugal are threatening to become the next dominoes to fall. The EU will certainly have to trigger new emergency plans for those countries. This perspective is confirmed by the negotiation between Spain and the other European countries, and Merkel’s visit to Spain scheduled in September.

Asked by the television channel BFM-TV if the EU was expecting too much from Greece, a commentator said, “you always ask someone too much when you ask him to take a cure that is going to kill him”. The Greek Prime Minister did not use such words, but it is basically the meaning of the message he is trying to spread to Europe’s leaders. Greece has for years been living in a state of emergency, on the verge of social explosion.

Comments

  1. Sarantis Symeonoglou says:

    Thank you for this very informative article. The impasse of Greece is fast becoming a EU problem. Few politicians and writers realize that this chaotic economy is quickly destroying the Middle Class that has been the foundation of western democracies. Instead of finding measures to strengthen it, European leaders are reverting to antiquated capitalist ideas. However, there is no solution without a healthy Middle Class and the goal of EU ought, in fact, focus on bringing more people up to its level. The frantic policies of today are deeply rooted in the false beginnings of industrialization since 1800 and the failure of capitalism to create a large Middle Class of highly educated, honest, and responsible citizens. It is very sad to witness the deterioration of the Greek Middle Class and to worry that the problem will be spreading into Europe and the USA. One wonders how long Capitalism will last without a vibrant Middle Class.

    • Marc Goetzmann says:

      Thank you for this long and interesting comment. It reminded me that Aristotle used to say that the best of democracies would be the one where the middle class is the strongest. It’s a Greek lesson that should be applied to Greece. Let’s hope the situation will be better in the years to come.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: