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article imageOp-Ed: Greece rejects German proposal to give up budgetary sovereignty

By Katerina Nikolas     Jan 29, 2012 in World
Athens - The Greek government has finally stood up and demonstrated some backbone and national pride, by rejecting a German proposal which would have seen Greece reduced to a puppet state.
The Greek government has stood up against the German proposal for Greece to transfer national budgetary sovereignty to European Union officials, rejecting it out of hand. Under the proposal, leaked this weekend by the Financial Times, Greece would have become entrapped under EU fiscal control, losing even the option to default and exit the eurozone.
The German proposal stated that all Greek revenue "are to be used first and foremost for debt service, only any remaining revenue to be used to finance primary expenditure." Effectively this would have forced Greece to use all revenue towards servicing its unmanageable debt before spending a cent on health and education.or other vital state expenditure.
The aim of the proposal was to strip Greece of sovereign control and leave her unable to "threaten its lenders with a default." Default, whether orderly or disorderly, may be the only solution for a bankrupt Greece to decide not to commit to a decade of austerity that reduces the country to a third world nation. Under the German proposal today's children would have become Mediterranean slaves to the power mongers in Germany.
DW-World reported "The European Commission in Brussels came out in support of the Greek government on Saturday, reaffirming its rejection of the proposal" with the EU Commission stating that key fiscal decisions "must remain the full responsibility of the Greek government." Greece's track record on maintaining budgetary control is indeed dire, but it is to be borne in mind that the major proportion of each bail-out loan received by Greece is already immediately committed to servicing debt. Greece then has to fulfil its contractual obligations to spend on German armaments.
Additionally Greece is already in a weak bargaining position when it comes to defending its own national interests against the pressure of the EU powers, as its reversal over EU sanctions against Iran demonstrates. It was in the Greek interest to maintain the veto it exercised in December, yet it bowed down to EU pressure this month when it overturned its veto. This move committed the nation to much higher oil prices from July 1, when Greece will lose its right to purchase oil from Iran, the only oil provider willing to sell to Greece on credit.
Meanwhile urgent talks continue over the next bail-out loans to Greece which are required by March 20 to avoid a disorderly default. Greek finance minister Evangelos Venizelos said on Saturday "we are a step away" from coming to an agreement, a tired line that has been reiterated over and over again.
The rejected German proposal should be a wake up call to the Greek government to start to prepare for what appears to an inevitable default, if not in March, then at some point in the near future. Instead of wrangling over petty politics prior to the election, the powers in charge should begin to concentrate on preparing the country to exit the eurozone, print a new currency and pave the way for default to occur without bloodshed.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of
More about Greece debt crisis, budget control, Merkel, transfer national budgetary sovereignity
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