Greeks Narrowly Elect More Austerity (While Their Football Team Faces Off With German Lenders)
When, over the weekend, Greece beat Russia 1-0 and Germany defeated Denmark 2-1, it set up a very compelling quarterfinal matchup between the two countries in the 2012 UEFA European Football Championship. No two European countries have had a more compelling relationship over the last few years, as Greece has been struggling to retain anything resembling an economy while it is dictated terms of debt repayment by the German-dominated EU and the IMF. Essentially, German bankers want their money and they haven't much cared how the Greeks have suffered in the face of severe austerity measures.
Yesterday, the Greeks went to the polls for the second time hoping to elect officials who can come to together to form a government. It looks as if the center-right won those elections, although without winning an outright majority. This is seen as a win for the "pro-bailout" faction that wants Greece to remain in the European zone and to keep the Euro as their currency. For some, like Paul Krugman, this is seen as a defeat (at least for the Greek people) because it assures that more austerity will be imposed on Greece, and that assures a continued downward spiral in their economy that will eventually lead them out of the European zone. Yet, most non-Greeks are heaving out a sigh of relief because a victory by the 'anti-austerity' group might have led to complete chaos that undermined (immediately) the Eurozone project and the currencies of Italy, Spain, and Portugal. A victory for the anti-austerity faction could have caused the global stock markets to panic and led to economic upheaval that put President Obama's reelection at risk. And I don't say this is as a partisan, but most of the world is not ready for a return of the Republican Party to power in Washington DC.
Yesterday's election results may have bought time and stability to the European economy and are welcomed by the White House regardless of the meaning for the Greek people.
"We hope this election will lead quickly to the formation of a new government that can make timely progress on the economic challenges facing the Greek people," Press Secretary Jay Carney said in a statement issued shortly after the pro-Europe New Democracy party claimed victory.
The win was expected to be welcome news for foreign leaders who have been pushing Greeks to vote to remain in the Eurozone.
Carney reiterated Obama's support for that view, saying "we believe that it is in all our interests for Greece to remain in the euro area while respecting its commitment to reform."
Adding another layer of poignancy to the election results, a Greek neo-Nazi party won around seven percent of the vote. That can't make the Germans feel too comfortable.
So, the stage is set for an epic football match on June 22, in Gdansk. The Greek nation may have narrowly, and by a plurality, decided to stick with the German-imposed bailout, but their national soccer team will now have an opportunity to impose its own form of austerity on Germany's offense. I can't wait to watch.