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Tuesday, May 22, 2012 1:14 AM


Greek Voters Need to Look Beyond the Lies of Bloomberg, Merkel, ECB, IMF, Ekathimerini; Greece Nightmare Coming or Already at Hand?


A half-baked editorial on Bloomberg, full of one-sided distortion, warns Greek Voters Need to Look Beyond Syriza’s Dangerous Lies.

Tsipras and his Syriza party are selling the Greek people a falsehood: namely, that Greece can renounce the terms of its bailout agreements with the euro-area governments and still receive their money. If voters believe him, and he attracts enough votes in elections on June 17 to follow through with his threats, then his country, Europe and the global economy will live for years with the consequences.

Tsipras hardly has a mandate -- he won 16.8 percent of the vote on May 6, and may increase that to 20 percent or more in June. But polls suggest Syriza is now fighting for first place with the center-right New Democracy party. In Greece, that matters, because the top party gets an extra 50 seats in the 300-seat parliament.

Europe’s politicians, across the political spectrum, need to make clear the distinction between Syriza and other parties that disagree with Europe’s austerity strategy. They need to say, repeatedly, that they want to help Greece, but they cannot, and it cannot remain in the euro, if its leaders simply abandon the commitments the country signed.

Greeks need to know that when they vote on June 17. And they need to know that what Syriza and its young leader are telling them is a lie.
Snakeoil vs. Lies

It's certainly true that it is highly unlikely for Greece to stay in the eurozone if it defaults on debt.

I am not a fan of lies (and I have pointed out lies by Tsipras). However, I am not a fan of snakeoil, thievery, and one-sided analysis either.

Snake Oil and One-Sided Analysis

Check out the Bloomberg hypocrisy in this statement: "Other Greek politicians say they’ll seek to renegotiate the austerity package, and Europe may now listen."

Bloomberg knows full well those are blatant lies. Bloomberg could have and should have blasted the New Democrats and Pasok leaders for those lies (but chose not to).

Moreover, Bloomberg knows full well nearly all of Greece is dead set against more austerity measures. Bloomberg also knows full well if New Democracy and Pasok came flat out and said the deal will not be renegotiated they would be trounced to smithereens in the next election.

Bloomberg Hypocrisy

Bloombeg ignores the lies of Pasok and New Democracy while blasting a similar lie made by Syriza.

In essence Bloomberg wants to decide which set of lies is acceptable and which isn't.

In contrast, I have pointed out the lies made by all of them.

If Not Now When?

Merkel, the IMF, the ECB, and all the eurocrats in Brussels know another election is coming up. If terms of the bailout were to be renegotiated ever, logic would dictate now is the time.

Are we supposed to believe there will be a significant change of heart in Germany and Brussels after another Troika-clown is Prime Minister?

The rest of Europe is not doing anything to help Greece.

Lending Greece money in which most of the money goes straight back to the lenders to pay interest is not going to help Greece. Nor are hikes in the VAT and other taxes.

Certainly the Pact With the Devil Over Gold is not in Greece's best interest.

Simply put, Tsipras is correct in his desire to tell the Troika to go to hell. The rest of his message is clearly a lie, but at least Tsipras has the essential idea: The only way Greece can get out of its odious debt is to default.

Greece Nightmare Coming or Already at Hand?

The Greek website Ekathimerini is on a major fearmongering campaign as evidenced by Nightmare foretold if Greece heads for euro exit
In Athens, the homeless are on the streets in growing numbers, soup kitchens feed twice as many people as a year ago, and the poor are diving into garbage bins in search of scrap they can sell.

Greece is close to breaking point as it struggles with austerity targets set by creditors, but this is just a foretaste of the nightmare of unrest, hunger and even anarchy that could engulf the debt-crippled nation if it is forced out of the euro.

If the exact economic impact of such a move is hard to nail down - newly issued drachmas devalued by up to 70 percent, runaway inflation, a banking meltdown, a collapse in trade - the implications for ordinary Greeks crushed by the debt crisis are even harder to predict.

Without international bailout cash, salaries and pensions would go unpaid and violence, political extremism and uncontrolled emigration could quickly follow.
Dose of Reality

Let's stop right there for a little dose of reality. The first paragraph alone shows Greece is already in a nightmare scenario.

Greece would have been better off defaulting three years ago, two years ago, and last year.

Yet here we are with Bloomberg and Ekathimerini (among numerous others) fearmongering about a Greek exit.

They should have been equally adept at raising issues why Greece should not be in the Eurozone in the first place.

Since that is water over the dam already, the pertinent question is what is best for Greece going forward. I propose that another 10 years of austerity and depression is not the answer. I also believe that is what Greece is doomed to if it manages to stay in the eurozone that long.

Fearmongering by Ekathimerini Resumes With Intensity

Let's return now to Ekathimerini for some massive fearmongering.
Provopoulos warned as long ago as December that a return to the drachma would be «real hell», with Greeks forced to resort to barter during the transition period between the two currencies, «trading a kilo of olive oil for three kilos of flour».

 "NIGHTMARE SCENARIO"

"There will be shortages in basic staples. Without fuel, the army and the police would not be able to move their vehicles.

A former finance minister, Yiannos Papantoniou, saw trouble ahead nearly a year ago: «Greece would not be able to support 11 million people so there will be huge emigration flows,» he told Reuters Insider television last July.

«Disruptions, social disruptions will come. I would say a regime of total anarchy."
What's Best for Greece

Greece needs to do what is best for Greece.

Short-term there will likely be intense breakup pain in Greece if it exits the eurozone. However, if Greece manages its cards correctly, Greece will recover far faster by telling the Troika to go to hell than by living the nightmare for 10 more years.

Icelandic Solution

Greece and Iceland are not the same. Iceland has exports and a work ethic. However, the facts show that Iceland recovered far faster because it had the courage to default, telling eurocrats where to go.

Simply put, Greece has nothing to lose and everything to gain by exiting the euro, the exact opposite of what Bloomberg and most of mainstream media would have you believe.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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