# Greek default seems to be inevitable...what's the fallout? **URL:** \ **Category:** Great Debates\ **Created:** [June 29, 2015, 8:24pm UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811 "2015-06-29T20:24:18Z")\ **Posts on this page:** 20\ **Page:** 21
**Author:** ![usedtobe](https://avatars.discourse-cdn.com/v4/letter/u/ec9cab/32.png) [@usedtobe](https://boards.straightdope.com/u/usedtobe)\ **Post date:** [July 12, 2015, 11:19pm UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/401 "2015-07-12T23:19:13Z")
I couldn’t believe that there was actually a crowd funding drive to raise the the 1.6 Billion Euro payment to the iMF that Greece wasn’t going to pay. I started a google search on “Indiegogo Greece”. After typing most of “indiegogo”, the prompt came back: “indiegogo Greece” - I didn’t even have to type the “g”. I guess many people were as amazed as I that there was actually such a thing. ---
**Author:** ![tomndebb](https://avatars.discourse-cdn.com/v4/letter/t/b9e5f3/32.png) [@tomndebb](https://boards.straightdope.com/u/tomndebb)\ **Post date:** [July 13, 2015, 1:30am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/402 "2015-07-13T01:30:02Z")
> [@multiple posters](#): > > “Fuck the Germans.” All right. Enough. There is nothing in that statement that moves the discussion forward and with more than 20 repetitions, it is getting boring. Everyone, knock it off. [/Moderating] ---
**Author:** ![CarnalK](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/carnalk/32/486_2.png) [@CarnalK](https://boards.straightdope.com/u/CarnalK)\ **Post date:** [July 13, 2015, 1:45am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/403 "2015-07-13T01:45:57Z")
> [@up\_the\_junction](#): > > “An EU official describes it as ‘extensive mental waterboarding’” > > Merkel needs to be seen to be revving German tanks on the Greek Finance Ministry lawn. What I love about Germans is they really embrace hard ball. You absolutely know what you’re going to get. > > Fuck the Germans. I’m curious, does it even enter your mind that maybe the Greek government fucked up in a number of ways? Was calling a referendum to take place after a deadline a totally legit move? Was a list of possible reforms totally a legit way to get the rest of Europe on board? I mean, as much as you’re disparaging the homey two guys lending money and one is a bum caricature, you sure seem to embrace the moustache twirling villian caricature. Seems just as bad to me, ---
**Author:** ![usedtobe](https://avatars.discourse-cdn.com/v4/letter/u/ec9cab/32.png) [@usedtobe](https://boards.straightdope.com/u/usedtobe)\ **Post date:** [July 13, 2015, 3:00am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/404 "2015-07-13T03:00:51Z")
I just saw a note, in passing, as it were, in news story about the continuing debacle: “Greece lost access to the bond markets in 2010”. 2010 is the date given as the first “bailout”. I take it that it was then that the French, German and other countries bought the worthless bonds? They burned through 240 billion euros between 2010 and the end of 2014. But now they say they can make it for 3 years on 50-some? They have been screwing around for 6 months now. It’s time to show them the door and nailed it shut after them. ---
**Author:** ![Velocity](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/velocity/32/18006_2.png) [@Velocity](https://boards.straightdope.com/u/Velocity)\ **Post date:** [July 13, 2015, 3:17am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/405 "2015-07-13T03:17:36Z")
Greece needs to understand that bluffs can be called. ---
**Author:** ![Velocity](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/velocity/32/18006_2.png) [@Velocity](https://boards.straightdope.com/u/Velocity)\ **Post date:** [July 13, 2015, 3:36am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/406 "2015-07-13T03:36:33Z")
> [@camille](#): > > And how will history remember Merkel? Probably positively; as someone who stood strong and didn’t back down. ---
**Author:** ![Measure\_for\_Measure](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/measure_for_measure/32/557_2.png) [@Measure\_for\_Measure](https://boards.straightdope.com/u/Measure_for_Measure)\ **Post date:** [July 13, 2015, 4:07am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/407 "2015-07-13T04:07:39Z")
> [@Donnerwetter](#): > > The problem with that comparison is that the IRS in Washington collects the taxes in South Carolina, Congress in Washington makes most of the relevant laws and the Federal government is an overall big player. Oh sure. I’m just saying that if northern European countries balk at sending chronic amounts of aid to southern European countries, then they shouldn’t share a common currency. It’s a recipe for extended depression. ## Even within a common currency area, having a mechanism for funding flows if one part of the map has a downturn is a good idea. Oklahoma and North Dakota arguably don’t share a natural common currency area with New York State in some ways: oil shocks affect them differently for example. But fiscal flows (and cross-state migration) offset such problems. For Euro-tough guys wanting to show Greece the door, be careful of what you wish for. Whatever happens to Greece is probably manageable. I’m not so sure about Spain, which has similar underlying issues as Greece with over four times the population. We are experiencing a prequel, not the main act. ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [July 13, 2015, 5:02am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/408 "2015-07-13T05:02:03Z")
> [@Terr](#): > > Hm. From the latest reporting, it seems that Tsipras’ clowning around in the last few weeks have so hugely damaged the relations between Greece and EU and so incredibly undermined any trust that some (seems like half of) EU members have towards Greece that nothing less than a complete Greek capitulation and ceding of financial sovereignty will produce any deal now. Somehow I think being a vocal anti-austerity politician with Communist roots and a bigshot in the European Left probably has more to do with it. Note that many websites say that “France” supports him and “Germany” opposes him. But it’s really French President Hollande (a center-left Socialist) who wants to compromise, and German Chancellor Merkel (a right-of-center Christian Democrat) who wants to crush him. This is about ideology and political parties, has been since the ΣΥΡΙΖΑ win in January. ---
**Author:** ![Donnerwetter](https://avatars.discourse-cdn.com/v4/letter/d/b2d939/32.png) [@Donnerwetter](https://boards.straightdope.com/u/Donnerwetter)\ **Post date:** [July 13, 2015, 5:11am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/409 "2015-07-13T05:11:55Z")
> [@Measure\_for\_Measure](#): > > Oh sure. I’m just saying that if northern European countries balk at sending chronic amounts of aid to southern European countries, then they shouldn’t share a common currency. It’s a recipe for extended depression. This is correct and I totally agree. > [@Measure\_for\_Measure](#): > > I’m not so sure about Spain, which has similar underlying issues as Greece with over four times the population. We are experiencing a prequel, not the main act. Again, I agree. The Euro is doomed and I’d like to point out that I’m not being sarcastic. I’ve shifted most of my personal investments away from the eurozone. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [July 13, 2015, 5:15am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/410 "2015-07-13T05:15:41Z")
According to latest news ([here](http://www.politico.eu/article/greece-crisis-live-tsipras-parliament-referendum-bailout-reforms-eurozone-eurogroup-council-summit/)) it seems that the Greeks have accepted all conditions in principle and are quibbling over: 1. IMF participation in the bailout (they don’t want IMF participation) 2. The size of the “escrow” that they are supposed to put collateral assets into. Germany is demanding 50B Euro, while Greeks claim that they don’t have more than 18B to put together even if they scrape the bottom of the barrel. I presume Germans would not suggest that figure without being able to provide lists of assets that would comprise the 50B, so I wonder how that will develop. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [July 13, 2015, 5:19am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/411 "2015-07-13T05:19:13Z")
By the way, as an example of why there is the “lack of trust” that is so detrimental to the negotiations: > **[Powering down Greece](https://www.politico.eu/article/power-bills-greece-utilities-electricity-ppc-grexit-crisis/)** > > Greeks haven’t been paying their energy bills, causing huge problems for the country’s biggest utility. PPC [the Greek electricity utility], in which the Greek government holds a 51 percent stake, was included in a privatization scheme the previous, conservative-led government had agreed with the so-called troika, the International Monetary Fund, the European Commission and the European Central Bank, to pull the country out of its economic crisis. But Tsipras’s populist government halted the privatization after taking power in January. Seems like “Tsipras’s populist government” is going to have to reverse themselves on this now. ---
**Author:** ![camille](https://avatars.discourse-cdn.com/v4/letter/c/22d042/32.png) [@camille](https://boards.straightdope.com/u/camille)\ **Post date:** [July 13, 2015, 5:39am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/412 "2015-07-13T05:39:32Z")
> [@Terr](#): > > According to latest news ([here](http://www.politico.eu/article/greece-crisis-live-tsipras-parliament-referendum-bailout-reforms-eurozone-eurogroup-council-summit/)) it seems that the Greeks have accepted all conditions in principle and are quibbling over: > > 1. IMF participation in the bailout (they don’t want IMF participation) > > 2. The size of the “escrow” that they are supposed to put collateral assets into. Germany is demanding 50B Euro, while Greeks claim that they don’t have more than 18B to put together even if they scrape the bottom of the barrel. I presume Germans would not suggest that figure without being able to provide lists of assets that would comprise the 50B, so I wonder how that will develop. The Greeks capitulated on IMF involvement. Still haggling over the privatization issue. ---
**Author:** ![camille](https://avatars.discourse-cdn.com/v4/letter/c/22d042/32.png) [@camille](https://boards.straightdope.com/u/camille)\ **Post date:** [July 13, 2015, 6:37am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/413 "2015-07-13T06:37:21Z")
Over 15 hours, and they’re still going! This reminds me of the infamous “Greek Goodbye”. When I was a child, whenever my Greek relatives would visit us, my cousins and I would end up falling asleep while the adults kept going. When I would wake up in the morning, they were all still there! Some FM’s left the meeting to sleep, and woke up to find them still going. Maybe that’s Tsipras’s last weapon. Word is the Germans won’t budge on the 50bn privatization assets. Will lack of sleep wear them down? ---
**Author:** ![Donnerwetter](https://avatars.discourse-cdn.com/v4/letter/d/b2d939/32.png) [@Donnerwetter](https://boards.straightdope.com/u/Donnerwetter)\ **Post date:** [July 13, 2015, 6:49am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/414 "2015-07-13T06:49:27Z")
> [@camille](#): > > Will lack of sleep wear them down? I have no idea how Schäuble can keep going. He is 72 years old and he sits in a wheelchair (he is paralyzed from the waist down). ---
**Author:** ![PastTense](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pasttense/32/14550_2.png) [@PastTense](https://boards.straightdope.com/u/PastTense)\ **Post date:** [July 13, 2015, 7:08am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/415 "2015-07-13T07:08:33Z")
> [@](#): > > Eurozone leaders have reached an agreement after marathon talks over a third bailout for Greece, officials say. EU President Donald Tusk said the agreement was unanimous. He tweeted that a bailout programme was “all ready to go” for Greece, “with serious reforms and financial support”. Details of any agreement were not immediately clear > **[Greece debt crisis: Eurozone summit strikes deal](https://www.bbc.com/news/world-europe-33503955)** > > Eurozone leaders agree to offer Greece a third bailout, after talks in Brussels that continued through the night. ---
**Author:** ![Rune](https://avatars.discourse-cdn.com/v4/letter/r/e68b1a/32.png) [@Rune](https://boards.straightdope.com/u/Rune)\ **Post date:** [July 13, 2015, 7:47am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/416 "2015-07-13T07:47:37Z")
> [@Measure\_for\_Measure](#): > > Oh sure. I’m just saying that if northern European countries balk at sending chronic amounts of aid to southern European countries, then they shouldn’t share a common currency. It’s a recipe for extended depression. And if other countries want continuous fiscal transfers they shouldn’t balk at having their economic policies decided in Frankfurt, or be put under administration if they fuck up. And lets not forget there is a vast East European side to Europe which is a hell of a lot poorer than southern Europe. If we want fiscal transfer based on wealth, Greece/Spain will be sending money eastwards. In any case, a deal seems to have been reached. But it’s interesting to see a new political block solidify consisting up Germany/Netherlands/Finland + former Communist countries. ---
**Author:** ![Hiker](https://avatars.discourse-cdn.com/v4/letter/h/3be4f8/32.png) [@Hiker](https://boards.straightdope.com/u/Hiker)\ **Post date:** [July 13, 2015, 8:16am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/417 "2015-07-13T08:16:31Z")
Both Merkel and Tsipras have already started selling the deal to their own parliaments. Merkel said she could recommend with firm conviction to enter into formal negotiations and that now “the advantages of an agreement outweigh the drawbacks”. Tsipras said the deal would allow Greece to “stand on its feet again”. It’s clear that both leaders are still facing the hurdle of having to obtain parliamentary approvement back home - and the deal is not going to be popular in either country. My take is that in the end both parliaments will agree but not without giving their leaders some heat first. I am not so sure about the parliaments of some of the other countries, especially Finland and Slovakia. But I have no idea what would happen if they reject the deal. Does anyone know? ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [July 13, 2015, 8:27am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/418 "2015-07-13T08:27:46Z")
Forget the wind and piss, how big is the debt write off? ---
**Author:** ![Measure\_for\_Measure](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/measure_for_measure/32/557_2.png) [@Measure\_for\_Measure](https://boards.straightdope.com/u/Measure_for_Measure)\ **Post date:** [July 13, 2015, 8:33am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/419 "2015-07-13T08:33:33Z")
> [@Rune](#): > > And if other countries want continuous fiscal transfers they shouldn’t balk at having their economic policies decided in Frankfurt, or be put under administration if they fuck up. And lets not forget there is a vast East European side to Europe which is a hell of a lot poorer than southern Europe. If we want fiscal transfer based on wealth, Greece/Spain will be sending money eastwards. I’m not advocating anything. Furthermore fiscal transfer based on wealth is off. The. Point. Look. It’s a choice. It comes in 3 parts. a) Different economies sharing a common currency with economic stabilization in the form of counter-cyclic and counter-geographic spending and taxing, b) Different economies with different currencies and economic stabilization via changing exchange rates, or c) the worst of both worlds: no fiscal transfers as cushions and no exchange rate depreciation as a cushion. The result: continued depression in Greece. My ideal is actually b). If the Germans don’t want to send money south to Spain and Greece like New York and Connecticut fund Alabama, Mississippi and Louisiana, I can’t blame them. But a) is fine too. I just don’t like c). That said there are good security reasons for France to join with Germany while the Benelux countries go along for the ride. _But they need to plan for fiscal stabilization as well._ That could take the form of a United States of Europe or better yet a funding facility that takes in a value added tax during expansions and sends out block grants during recession. I’d prefer the latter actually, not that it matters. ---
**Author:** ![AK84](https://avatars.discourse-cdn.com/v4/letter/a/85e7bf/32.png) [@AK84](https://boards.straightdope.com/u/AK84)\ **Post date:** [July 13, 2015, 9:03am UTC](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811/420 "2015-07-13T09:03:59Z")
Will this “deal” basically kick the ball to 2018-2020 when most of the principals will be out of office? Thats what it seems to me. [Previous page](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811.md?page=20) [Next page](https://boards.straightdope.com/t/greek-default-seems-to-be-inevitable-whats-the-fallout/723811.md?page=22)