Let us accept that Greece actually won a fight, though more correctly, it survived to fight another day, perhaps at a more favorable juncture.
In this battle the Greeks won a few issues but retreated on many others.
Nonetheless, it is a victory because Alexis Tsipras seems to have been transformed from a SYRIZA leader into a Prime Minister, a leader who pursues national interests rather than partisan ones.
If he had not done an about-face and compromise at the eleventh hour, Greece today would be facing a new reality, and not at all a pleasant one.
Today’s reality consists of the major promises Tsipras made along with some position shifts: there will be no new haircut, the memorandum continues, and implementing reforms remains the condition for continued funding.
And the reality is that Tsipras managed to reduce the size of the primary surplus demanded of Greece, below the 4.5 percent that was called for until now. That is hardly an insignificant matter.
We also now see clearly that Greece’s negotiating strategy was wrong. The cards Greece was holding were much weaker than they the ones they thought they had.
First and foremost, we know that the economy was on the verge of collapse with banks losing substantial amounts of deposits each day,-3 billion euros last week alone, according to J. P. Morgan – while state revenues were coming in lower than anticipated.
Second, instead of finding sympathy among its fellow Southern Euro members, Spain, and Portugal, and Italy, they proved to be Greece’s toughest opponents.
And third, Greece angered the Germans and others in the North with their behavior, as evidenced by German Finance Minister Wolfgang Schaeuble’s comments, which ranged from tough to offensive.
But Greece still has two powerful bargaining chips: first, its geopolitical position. It is very likely that this card forced the Germans, under pressure from Washington, to accept this agreement.
Second, the threat of leaving the euro.
If Greece was not determined to play these two cards, then it never should have adopted a reckless cowboy negotiating style. In any case, the Grexit card is rapidly losing value.
Finally, we note a missed opportunity that should not be overlooked next time. The opportunity for Tsipras to tell the people the truth: “We fought hard, we did what we could, but we were faced with the reality of miserable finances. And now, let us all work together to build a new Greece.”
Greece also still possesses the opportunity to fix its institutions and implement reforms not yet undertaken, now with the excuse of being under Troika –the representatives of the Institutions they call it now – pressure.
Let us not miss this opportunity next time, because who knows if there will be another one!
As to who actually won or lost SYRIZA’s opening gambit versus the Germans, is almost irrelevant to us all but to the politicians.
The post Greece’s Gains, Losses Made Tsipras Grow Into His Job appeared first on The National Herald.Source: The National Herald