It’s all over for Greece. Is it? – Part III A psychological war between Germany’s ego and arrogance and Greeks pride and stubbornness By Dr. Bobby Srinivasan and Dr. Sudhakar Balachandran

April 24, 2015 | Posted by bobbysrinivasan << back to blog

This is a hypothetical conversation between the German Chancellor Ms. Angela Markel and the Prime Minister of Greece Mr. Alexis Tsipras.

Ms. Markel: As a dominant member of Eurozone, I have been repeatedly pointing out to you that your budget debt of 176 percent of GDP is obnoxious, sinful, dastardly and will create enormous damages to our union’s credibility. Tell me what steps you are considering to take to bring down the budget debt.

Mr. Tsipras: Before you proceed any further please bear in mind that any insinuation, accusation and derogatory remarks will produce serious negative reaction among the Greek citizens. You know the facts. Our party has inherited from the previous government literally bankrupt treasury and which abused every economic norms possible.

They even fudged numbers to make the economy appear strong. Please understand that we are a new government committed to bringing order to our economy and in no way want to disrupt the Eurozone economic activities by our unilateral and impulsive action. We need time perhaps a decade to fix all our economic problem.

Remember, our workforces are not slaves. In the past they have been used to working lesser hours but their working hours have increased substantially. Not even for a moment think that we could become instantaneously productive and cost competitive. Our work ethic is changing for the better. I accept that this change should become permanent. In summary we need to become more efficient, more productive, etc. You are aware that changes don’t come overnight. I promise you we will get there eventually.

Ms. Markel: This is all baloney. Your country could have tried to put its house in order long ago. You were aware of what is coming and didn’t act at all. Still you went ahead and kept increasing the government debt by providing better salaries to your civil servants, increased pensions and social security benefits. Now you are asking us to understand? What do you really want me to understand?

Mr. Tsipras: Now, we are talking. First we need liquidity. We require 7 billion euros immediately. Our civil servants need to be paid. If we don’t they won’t work. Every month it costs us 1.7 billion euros for the salaries alone. Also we owe 450 million euros for the interest payment to the IMF. There is one more important thing I want to bring to your attention. You remember that after World War II, you had so much debt to pay to France and England for war reparations. You didn’t have money. Both these countries magnanimously wrote-off your loans. Why don’t you do that to Greece?

Ms. Markel: That was a different time then. Let us not go into the past. I tell you what, I will recommend the European central bank to release the cash on condition that you will improve your austerity measures.

Mr. Tsipras: We will try. But first I suggest that you visit our country and see for yourself. Our current austerity could push the unemployment rate to 30 percent of the population, a certain recipe for a revolution. Patients in the government hospital cannot get treatment for want of money. Old age pension payment has been delayed; poor Greek retired civil servants and they are lining up before the soup kitchen. Your level of unemployment is very low. You are enjoying the highest standard of living. It is not probably easy for you to understand. In your true conscience does it make sense to continue austerity measures? Greek people are proud citizens but please don’t make them terrorist. It is within your powers to arrange for credit and to prolong the situation until our productivity, efficiency and growth takes off. We have already enough austerity. Anything more we must be prepared for a civil war.

Ms. Markel: It is something to think about. I will be back soon with a better solution.

Mr. Tsipras: Thank you.

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