After Varoufakis abandoned ship and Tsipras more or less succumbing to his fate, the entire world is starting the question the reasons why Greece defied the European bailout plan for so long. It seems now as if Greece does not have any friend in Europe left, who is ready to vouch for their credibility. Yes, France and Italy do appreciate the Greek attempt to mend anything, but there is no trust and not much basis left for anybody to find the final outcome a success. Greek people, despite still having confidence in Tsipras, feel betrayed, blame Germany for everything, although Germany is just one voice out of 17 member states opposing a straight-out get-out-of-jail-free-card for the Greek economy.
In financial terms, Greece has done everything wrong. They lied and falsified their books when they entered the Euro zone, they did not pay back their debt as they should have and entered into more debt, just to cover up their misdoings, without thinking about consequences. This sorry state of affairs got used by the populist and borderline narcissistic Tsipras in order to gain power. Syriza does not have a solution for the current crisis and accepting the package Greece just rejected in a very public referendum will not be accepted by the EU, even if Tsipras seems inclined to do so.
While most of the EU is not really willing to spend their vacation in Greece, less fortunate and rich countries, such as Serbia, are more than willing to jump in and benefit from the growing desperation. Greece is thankful, because if nobody would come to Greece during the peak season, all Hell would break lose. The EU is unwilling to put more pressure onto Greece, but there are also aspects to behold that were not addressed in current weeks.
It is interesting to note that Greece does not owe any money directly to the US. The EU, during the bailout procedures, purchased through various avenues all the debt to the US, in order to stabilize the Euro. Greece used that bailout to get more money from the US, through avenues that were not immediately perceived by the EU, but when they figured it out, they went ballistic. Again, EU bailed out the newly accrued debt, but put a blockade on Greece to not funnel more American money into Greece. This is what the whole circus is about now, the hysterical attempt by Greek people to get more “free money” from the US and the EU blocking it.
The reason why the EU wants to kick Greece out of the Euro zone is simple – they want to allow Greece to accept as much money as they want from the US, without affecting the value of the Euro. Greece would not owe the US money they have to repay by selling Euro in order to purchase Dollars to repay the debt, Greece would use (most likely) Drachma as the currency and the sale of Drachma would not affect the Euro in any way. The problem the Greek would have with that is that they would need to do business with the EU the same way, by purchasing Euro with Drachma, devaluating their own currency, in order to continue the vital trade with the EU, allowing Greece to survive and their companies to continue doing business.
The main disadvantage for the Greek would be the loss of value, because all the European produce would become expensive, all Greek stuff would become cheap. On the other hand, Greece would become a cheap haven for companies, with cheaper labour, allowing economic growth and thus prosperity. This is why the EU does not understand why Greece is not prepared to accept such a scenario. It would ultimately lead towards rejuvenating and rebuilding Greece. But Greek politicians are not interesting in amassing riches in shabby Drachma. Additionally, if Greece becomes cheap, it has to compete with countries such as Bulgaria, Romania, Croatia, but also with Serbia, Albania and Turkey. Greek people do not identify with the Balkan and Mediterranean states, they fancy themselves as founders of the EU, the core of the EU, not a place that just yesterday became a sovereign state, Greece was there before the Germans, you know?
Between the national prides, the common sense, the irresponsible way of doing business, the great history and the mounting debt, it is not easy to find a common ground to make a deal, where everybody gets to keep face and be happy with the result. Unfortunately for Greece, they did not play their cards very well, counting on bankers to show humanity is always a mistake, then trying to shame them into putting their profits behind mercy is another. When it comes down to money, the goals are clear. You dance the way the music of money plays, or you sit out this particular song. Having it both ways does not happen, even if you have your whole country behind you.