According to German daily Frankfurter Allgemeine Zeitung yesterday, and Dutch NOS TV today, there almost was a compromise about Greek finances between the new Greek government, elected on an anti-austerity platform, and their pro-austerity creditor ‘troika’: the European Commission, the European Central Bank and the International Monetary Fund.
The troika demanded that the lowest pensions in Greece, already cut to the bone and beyond the bone by the previous pro-austerity Greek government, should be cut once again to the starvation level of 300 euros a month. The new Greek government refused that.
Then, there was a compromise proposal. The poorest pensioners in Greece would not suffer more cuts. To keep the budget balanced there would be a smaller Greek military budget. Greek government military spending on German and French weapons is a major cause of the country’s economic problems. It is said that even European Commission boss Juncker, definitely pro-austerity and pro-militarist, agreed with that compromise.
However, then Ms Christine Lagarde‘s International Monetary Fund vetoed and wrecked the compromise proposal. According to Thatcherite neoconservative economic ideology, the main task of governments is preparing for wars and waging wars. And people like poor Greek pensioners can go to hell. Like the British conservative government of David Cameron always says on the one hand ‘There is no money’ for things which help people, the environnment, etc. But on the other hand spends many billions of pounds on Trident nuclear weapons.
So, there is still no agreement between the Greek government and the troika.
What depresses us is how little attention has been paid to one major area of Greek government spending that seems ripe for the ax: defense spending. Greece spends a whopping 2.2% of GDP on defense, more than any NATO member-state save the United States and France. Bringing Greece into line with the NATO average would alone achieve ¾ of what the IMF is demanding through pension cuts: here.
With Greece teetering on the edge of bankruptcy, crisis talks in Brussels collapsed Sunday after European Union (EU) and Greek officials failed to agree on what austerity measures Greece should adopt to obtain continued funding from the EU’s Greek bailout fund: here.
IMF admits: we failed to realise the damage austerity would do to Greece: here.