"They have decided to strangle us, whether we say yes or no", said a Greek woman to me yesterday.
"The only choice we have is to make it quick or slow. I will vote "oxi" (no). We are economically dead anyway. I might as well have my conscience clear and my pride intact."
At times of financial strain, a country's currency issuer, its central bank, should act as lender of last resort and prime technocratic negotiator. In Greece's case, the European Central Bank, sits on the same side as the creditors; acts as their enforcer.
EU Institutions are now openly admitting that their aim is regime change. A coup d'état in anything by name, using banks instead of tanks and a corrupt media as the occupiers' broadcaster. The rest of Europe stands back and watches. Those leaders who promised the Syriza government support before the election, have ducked for cover. I understand it. They sympathise, but they don't want to be next. They are honourable cowards. They look at the punishment beating being meted out and their instinct is to protect their own.
Corruption and tax evasion had been rife for decades. Accounts were falsified in order to facilitate entry into the Euro. Unforgivable economic crimes were committed. These weren't committed by most ordinary people of course - the very people now asked to take on the burden of the follies of our rich oligarchs. Corrupt politicians who passed the country back and forth like a joint were quick to secure their money in Swiss bank accounts. But we must share in a collective responsibility for them. We all knew what was going on and we either became part of it or didn't rebel soon enough or loudly enough.
Those factors are what put us on the front line when the global financial crisis began to unfold within the Eurozone. All those systemic flaws are what made Greece the weak link when the earthquake hit. But we didn't cause the earthquake. We just lived in creaking houses that went down easily.
Greece should have been allowed to default in 2010. Default is a normal part of debt, not some monstrously catastrophic event. Germany has defaulted on its debts four times in the last century. Italy six. Default is reflected in interest differentials. An element of interest on a loan is of course "rent" for using someone else's money, but the reason Germany's government 10y bonds trade at below 1% and Venezuela's at over 24% is not whim. It reflects risk. Removing that risk is the real moral hazard.
"Stop whining and pay what you owe." "Nobody forced you to take the loans in the first place." "Why should taxpayers elsewhere pay for your extravagance?" There was some truth to all of those things back in 2010. There is no truth to them now. We were forced to take the loans. That is precisely what happened. We were told "do this for all of us", to avoid contagion. Less than 10% of the "Greek" bailout has gone to Greece. The rest has gone to strengthen irresponsible financial institutions, mainly French and German, which were heavily exposed.
I'm not surprised that 90% of the bailout went to irresponsible banks. This is what the state does, support powerful vested interests at the expense of the taxpayer. How many more times do you need to be slapped in the face with it before you realise that it's the problem, not the fucking solution?
There was no provision within the Eurozone for what happens if market shock creates sudden and dramatic divergence between countries' economic cycles. (Emphasis is mine.) We were no longer individually in charge of basic economic levers like quantitative easing or devaluing our currency - a standard response in those circumstances. Our fates were entangled. We could either devalue the whole of the currency which would help countries severely affected by the crisis or not devalue which would help countries like Germany which were in a more robust position. We were told: "do this and we will look after you". Whatever it takes, said Mario Draghi, to convince Greece to take yet another loan.