3 July (EIRNS) City of London mouthpiece Ambrose Evans-Pritchard writes that the latest International Monetary Fund report on Greece admits that the bailout policy is a failure and unsustainable. In his regular Daily Telegraph column, Evans-Pritchard argues that when the IMF forecasts that Greece’s public debt will reach 176% of GDP this year, it is “obviously preposterous” for it to be reduced to 124% by 2020 as the plan forecasts, since Greek economy is in free-fall. The entire policy is a violation of the IMF’s own rules and was only acceded to in order to save the euro, not the Greek economy, he writes. Pointing out that German Chancellor Angela Merkel continues to insist there can be no second package of debt relief this year only because of next month’s German elections, nonetheless after the elections the decision for another bailout package or a haircut will be pushed into 2014.
Evans-Pritchard warns that the Greek catastrophe will not go away, and that a breaking point will be reached in which anything could happen in Greece that would blow back on the entire Eurozone. He cites a recent article on Greece by James Galbraith, who wrote that in Greece “you’re not far away from having a confrontation that will lead to a real, let’s say, breaking point.”
To which Evans-Pritchard adds, “Nothing whatsoever has been resolved, either in Greece, or in Portugal, or in Cyprus, or in Spain, or in Italy. Nor will there be, under the current contractionary policy structure. There is no Deus ex machina.
“These nations will remain trapped in slump and mass unemployment until they take matters into their own hands, form a debtors’ cartel, confront head-on the gunboat creditors from a position of strength, and dictate the outcome. But first they have to defenestrate out their own cowed elites.”