Greece, it would seem, is faltering once again. This week's SPIEGEL, published on Monday, reveals that the country needs to make additional cuts of 14 billion ($17.3 billion), instead of the 11.5 billion thus far assumed, in order to fulfil the conditions established by its international creditors.
The gap -- 2.5 billion -- may not seem like a lot give the hundreds of billions of euros the international community has already thrown Greece's way to stave off bankruptcy. But increasing numbers of politicians, particularly in Germany, have gone out of their way recently to promise that a third bailout package for Athens simply isn't acceptable. Furthermore, for all its forced optimism in recent weeks, the country's international creditors have reportedly found that both tax revenues and Athens' privatization program are not developing as planned. A final report on the current state of Greece's finances is due at the beginning of September.
Whether Greece will ultimately become the first country to exit the euro zone remains to be seen. Forty-five of the 64 economists polled by Reuters in August believe that Greece will still be a part of the common currency one year from now, up from 35 of 64 polled in May. And the country may yet be granted a reprieve in the form of two extra years to come up with the 11.5 billion in savings currently being demanded of it. Such a stay promises to be an element in negotiations late this week as Greek Prime Minister Antonis Samaras visits both Berlin and Paris.
Nevertheless, the new round of bad news on Greece has put German commentators in a fatalistic mood on Monday as they ponder what went wrong and what the future might hold.
Conservative daily Die Welt writes:
"For some time now, the Chancellery in Berlin has been wavering between two viewpoints. Those who adhere to the ballast theory believe that the euro zone will stabilize itself once the euro zone is relieved of Greece -- a country which has notoriously missed all of its targets and which is politically unreliable even under its new government. The domino theory, on the contrary, holds that, once Greece goes under, the financial markets will focus on the next countries in line: Portugal, Spain and perhaps Italy. Not because evil investors are intent on destroying the euro, but simply because a Greek exit would mean that euro-zone member states had broken their word. They have promised not to leave a single country behind. If Greece were to drop out and they repeated the promise for the remaining 16 countries, who would believe them? The governments have maneuvered themselves into a situation where they can only break the promises and rules they have set for themselves."
"Merkel hasn't yet made her decision. She is still looking for ways to limit the damage, to both the euro zone's credibility and its finances. It will be decisive whether the chancellor and French President François Hollande can work together to develop a common strategy. The success of efforts to save the euro is dependent on it."
Center-left daily Süddeutsche Zeitung writes that there is a growing desire, particularly in Germany, for political and fiscal union. "It would not, however, be an intelligent way to go. Such a reform would overburden the peoples of Europe and would likely further its disintegration rather than its growing together ."
"Sharing debt across the bloc might calm the markets, but it would not provide the EU with lasting stability. The turbulence experienced by the common currency is not the cause, rather merely an expression of the real problem facing the European Union: It is not trusted. It has yet to convince the world, or even its own citizens, that it can fill the role of a strong and reliable power. There are simply too many contradictions in the EU, not just when it comes to the economy and finances, but also in foreign or security policy. Europe has not yet convinced the rest of the world that it has irreversibly grown together."
Left-leaning daily Die Tageszeitung writes:
"Try this extreme thought experiment: Assume that all of Greece's debts were forgiven, which would relieve the country of all interest payments. Even in such a case, the Greeks would still accumulate more debt. The state cannot completely finance itself because its tax revenues are insufficient. And it still isn't enough for Europe to demand even more austerity programs. They would simply make the recession worse, and tax revenues would plunge further."
"The metaphor 'bottomless pit' has long since become synonymous with Greece, and it is true that a bottom is not yet in sight. In other words, there is no cheap solution. Instead, the only question is which of the expensive solutions is the cheapest."
"History shows that no country has ever been nursed back to health while it is stuck in recession. One has to invest in growth. That would, it is true, require new loans, but a draconian austerity program also leads to new debts. To be cynical for a moment: It is a win-win situation. It isn't a risk to launch an economic stimulus program. It is Greece's last chance."
Center-right daily Frankfurter Allgemeine Zeitung writes:
"It is justified, and consistent with the spirit of Europe, to questions the legitimacy of, allegedly mandatory, efforts to save the euro. It is true: The debate over Europe is chaotic. Short-term measures are being confused with long-term strategies. On the other hand, it isn't easy to develop plausible visions while staring into the abyss . But a regression to old patterns of nationalist resentments is also a possibility when all respect is lost for rules governing the union. The fact that we have long since created a community of shared liability -- in violation of the spirit of European treaties -- is hardly a good foundation for trust."
-- Charles Hawley
Stay informed with our free news services:
|All news from SPIEGEL International||Twitter | RSS|
|All news from Europe section||RSS|
© SPIEGEL ONLINE 2012
All Rights Reserved
Reproduction only allowed with the permission of SPIEGELnet GmbH