Commentary. Greece is a country of laws and it’s budget can’t be cut constantly from the outside.

IMF games don’t help Greek debt problem

It’s the usual tactic, repeated again in a vicious circle that seems to have no end. After the Eurogroup agreement reached May 25, which seemed to ensure a period of relative peace for Greece, the International Monetary Fund again created strong doubts and uncertainties.

According to reports in the Greek press, IMF sources have indicated that the international economic organization based in Washington will not take part in the new financial support program for Athens until Greece can provide adequate assurances about real reduction of debt. This means, essentially, that what was decided on a Wednesday was put into question on a Friday.

In theory, the basis of all this seems to be yet another arm wrestling contest between the IMF and Germany and the “hawks” of the Berlin government. The former calls for an immediate sustainable debt relief, without waiting for 2018, while the latter does not want to give its assent to any type of opening, before the German elections in 2017. “We want more guarantees on debt,” IMF senior executives insist. In practice, however, this game among the parties could lead to new pressure on Athens, with the request to other cuts, where there is was really nothing left to cut out, if not the keeping of social cohesion.

And for his part, the leader of the hawks, Wolfgang Schauble, made it known that it is possible that next year more sacrifices are required to Greece, despite the fact that the country “has already made great efforts.” The European Commissioner for Economic and Financial Affairs Pierre Moscovici tried to reassure the Greeks, excluding the signing of new memoranda, convinced that “it is necessary to approve only a few technical details.”

But everyone knows that the creditors, since they hold the knife by the handle, usually ask for more and more, and that every “detail” hides new claims about the full liberalization of lay-offs, the final abandonment of the collective labor agreements or disadvantageous conditions with regard to the delicate chapter of privatization.

The crisis has mainly affected the most vulnerable social groups, and the latest statistical data fully confirm this finding, which is very easy to calculate, knowing the Greek reality: Between 2008 and 2014, 10 percent of the poorest Greek families lost 85 percent of their income, while 30 percent of the most affluent citizens suffered a loss of revenue of up to 20 percent. In regards to the issue of direct and indirect taxes, until 2012 the burden for the poorest was of 338 percent, while the increase for the rich has not passed a measly 9 percent.

These numbers speak for themselves and indicate very clearly that most of the effort should focus on restoring social justice and a redistribution of income, as pressing as ever. The Tsipras government tried in every way to avoid burdening the shoulders of the unemployed, part-time workers and pensioners any more than the minimum the cost of new measures applied, or rather imposed, by creditors.

But in order to restart the country and to heal the deep wound created by years of limitless liberalism, they would really need special support plans and investment that go far beyond the €3.5 billion with which the Greek state will start paying its internal debt.

The Syriza government is betting on debt relief, to give a breath of oxygen to the economy, providing a real boost to growth and to help, in this way, even the weakest social classes. But the lending institutions — with their constant vacillations and cunning games — do not seem to realize how Greece needs to leave behind a past of horizontal cuts, impositions and dictates on how and where to cut back the national budget and continuous tax increases. Greece must also respect its own laws and cannot accept uncritically every desire of the various trios or quartets.

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