The Greek parliament approved late Saturday Greek PM Alexis Tsipras’ bailout plan for a deal with Greece’s creditors based on his draft proposals. Finance Minister Euclid Tsakalotos convened parliament to approve the plan as well as to authorize the negotiating teams to reach an agreement. Of the 282 members voting in the 300 member parliament, 232 voted yes, with only 32 voting no, and eight abstentions. The bill authorizes the Finance Minister Tsakalotos and VP Joannis Dragasakis to sign the agreement with the creditors. A few Syriza members abstained by voting “present” an indication that they would not support the party line.
Finance Minister Euclid Tsakalotos said: “Even though we were not obliged to do this, after the 61 percent in the referendum, since we had a stronger position, we want to do it in order to make it even stronger.” Pardon me, but I thought that over 60 percent of Greeks voting just rejected a deal with less austerity. Tsakalotos interprets this as giving him a mandate to sell out for a worse deal. The problem is that to the very end Tisipras, Varoufakis, and Tsakalotos have signalled they would do anything necessary in order to get a deal. Tsipras acknowledged that his proposals contain new austerity measures including tax hikes and cuts to pensions. These proposals erase the last two red lines which Syriza would not cross.
When the last deal was offered the Greek negotiators did throw a wrench temporarily in the process by calling for a referendum Perhaps they felt that Greeks would vote yes since they want to remain in the euro zone. This would then justify a sell out of the type they are proposing. However, the vote was a strong no. This did not phase the Syriza negotiators, who were petrified as the creditors bled the Greek economy to death and the banks had to be closed along with stock markets. The no vote is now being interpreted as if it were a very powerful yes. In Athens, Tsipras told a reporter that accepting his proposals would put the prospect of a Grexit behind Greece and allow him to move ahead in negotiations with creditors. However, Tsipras and the other Greek negotiators should have had Grexit as a Plan B from the very start or at least from the time long ago when it was clear that they would achieve little if any austerity relief from creditors. The creditors in contrast were intelligent enough to begin framing their own Plan B for Grexit if negotiations looked set to fail. They may still execute that plan.
Yanis Varoufakis has a recent article in the Guardian in which is claims: Based on months of negotiation, my conviction is that the German finance minister wants Greece to be pushed out of the single currency to put the fear of God into the French and have them accept his model of a disciplinarian eurozone.
Given that Varoufakis and other Greek negotiators will do anything for a deal, including signing up for another three years of debt slavery, he should welcome Schaeuble’s design to kick Greece out of the euro zone. Just as Varoufakis wanted to save capitalism in the EU by doing away with counter-productive austerity policies so does Schaeuble but the latter will do it by kicking out a troublesome debtor nation. Varoufakis said he resigned because Tsipras told him that some on the creditor side thought he was an obstacle to concluding an agreement. Varoufakis had not been part of the negotiating team since April. He had been replaced by Tsakalotos, the new finance minister. Tsipras and Varoufakis were signalling they would do anything for a deal even having Varoufakis resign. While a Grexit will certainly be difficult for Greece in the short run this is to a great extent a result of Syriza having no plan B for a Grexit. Their only hope to be free of the Troika and their creditors is that German Finance minister Wolfgang Schaeuble and his allies prevail reject the Greek deal and force a Grexit. Schaeuble is reported to have asked at one point during negotiations how much money Greece required to leave the euro. At that point the Greeks had an opening for useful negotiations.
