A few days ago the
Greek government submitted a list of proposals hoping to break the deadlock with the “institutions” – the European Commission, the International Monetary Fund and the European Central Bank. The government basically agreed to tough primary surpluses: 1% in 2015 and 2% in 2016. To achieve these targets it proposed to raise VAT on a range of widely consumed goods as well as imposing a host of taxes on enterprises and families of “high” income. It also proposed substantial savings on pensions. The measures added up to roughly €8bn over 2015-16, and would be immediately implemented.
The package is certainly deflationary at a moment when the Greek economy is again on the threshold of recession. There is little doubt that it would contribute to output contraction and higher unemployment in 2015-16, particularly as there is little prospect of being offset by an investment programme funded by the EU. It is a major retreat by the government of
Syriza.
“institutions”, led by the IMF, was to demand even tougher measures to achieve the same targets. These include more severe increases in VAT, a lessening of the tax burden on enterprises and greater pension savings. If these demands are met, the government will not even be able to claim that it has shifted some of the increased tax burden away from workers and the poor.
For Greece as a whole, the prospect of a deal achieved on this basis
would be simply appalling. The country would be forced to adopt harsh austerity measures dictated by the lenders, without any realistic possibility of substantial debt relief, or of a significant investment programme. The “institutions” are once again attempting to impose the policies that have failed abysmally since 2010, causing huge contraction of GDP, vast unemployment and mass impoverishment. It would be a national disaster accompanied by the complete humiliation of the Syriza government.
For those who look at the European Union without rose-tinted glasses, there is no surprise regarding the attitude of the lenders. The EU and the eurozone in particular are in thrall to austerity, even institutionalising it through the
so-called six-pack and two-pack. The lenders have inevitably objected to lifting austerity in Greece, and appear to believe – foolishly – that austerity “works”. Furthermore, they are keen to inflict a political defeat on a leftwing government that has dared to challenge the European status quo. Europe has shown a harsh and cynical face toward Greece, whatever might be the faults of Greece itself.
https://www.theguardian.com/comment...mailed-eurozone-troika-syriza-common-currency
Please explain your postulation.
The Lisbon Treaty was designed as a replacement for the ‘Treaty establishing a Constitution for Europe’ or TCE, which was rejected in referenda in France and the Netherlands in 2005.
Some view the Lisbon Treaty as much the same kind of deal as the TCE, making it arguable that the French and Dutch governments ignored their TCE referendums.
However, the Lisbon Treaty was changed in an attempt to assuage opposition. For example, it removed references to EU symbols such as the flag, anthem, motto, currency and ‘Europe Day’ that had given rise to fears that a ‘superstate’ was being created.
It was notable that, this time, no other country apart from Ireland held a referendum on ratification.
Some view the Lisbon Treaty as much the same kind of deal as the TCE, making it arguable that the French and Dutch governments ignored their TCE referendums.