July 14, 2015

Biggest loser: Greece, Euro, France, Germany?

Now that Greece and its Eurozone creditors have apparently come to some sort of deal, albeit one that is perhaps even harsher than what was on tap just a month or two ago, the finger-pointing has started.

So, here's my 2 cents worth of fingers.

First, Greece is somewhat a loser. It's a loser not just because of the bad new deal, but because, as just-resigned Finance Minister Yanis Varoufakis claims, Greek Premier Alexis Tsipras was and is exactly what Eurozone leaders have long claimed about him: vacillating and spineless.

So, it's a loser because, unless Syriza replaces him, the Greeks don't have a real option to stand up to the EU. And, Syriza as a party winds up looking like a toothless tiger.

The euro as a currency is somewhat dented, but it's  not too bad a loser.

France? Somewhat a loser. It was the biggest pusher for the creation of the euro as a joint currency after the collapse of the Soviet Union, precisely to restrain German financial hegemony. Françoise Hollande got the EU to paper over France-Germany differences, but it's clear that the big stick of German Iron Chancellor 2.0 Angela Merkel forced France to accept giving Greece as harsh of a deal as it got.

Germany? A lot of people are claiming it overplayed its hand. However, the fact that it publicly displayed a card hand of wanting to give Greece a five-year boot shows that Merkel, along with her financial minister, Wolfgang Schäuble, knew exactly how close to the vest to play. And, the fact that other eurozone diplomats wanted to "teach Greece a lesson" only underscore this.

Finally, the whole world is a loser if part of the results of this German-pushed deal force Greece to sell off historic world heritage assets.

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