According to Der Spiegel, Greece’s new bailout is going to amount to over €100 billion, a rather higher number than the €80 billion or so that has usually been mentioned.
That’s unlikely to thrill German taxpayers. They are also unlikely to be amused by the photo (from May 30) of Greek protestors with which the article (in German, shockingly) is illustrated. And all this matters. As this piece in Reuters reminds us, the politics of getting the bailout through will be tricky:
It is unclear whether the new Greek rescue would be funded by the euro zone bailout fund, the European Financial Stability Facility, in which case German Chancellor Angela Merkel would not need to seek formal parliamentary approval. If the rescue were conducted outside the EFSF, she would probably have to go to parliament, exposing her to criticism from backbench rebels. Because Berlin is keen to keep the euro zone together, many analysts think Merkel will spend whatever political capital is needed to ensure German participation in rescuing Greece.
Quite possibly, and as her behavior over the EU’s Lisbon Treaty revealed, Merkel — who is in a number of respects a true child of the East Germany in which she was brought up — will bypass the voters if that is what it takes.
Reuters adds:
But support for the bailout in the Netherlands and Finland, while likely, is not completely certain. The Dutch government would be expected to seek majority support in parliament for fresh funding; the minority Liberal-Christian Democrat government would almost certainly win such support, but it would probably face opposition from its main ally, the Freedom Party, whose leader Geert Wilders is an outspoken critic of bailouts.
And then there’s the situation in Greece itself:
Political resistance to fresh austerity steps in Greece may be the biggest threat to a new bailout deal. The two main parties have been unable to reach consensus on a medium-term fiscal strategy; even if they achieve this, opinion polls show support for both parties dwindling, and Prime Minister George Papandreou faces a growing revolt within his PASOK party. A group of 16 backbench members of parliament from the ruling party on Thursday demanded a full debate on further austerity measures and privatizations. Papandreou’s party has 156 seats in the 300-member parliament, so he may be able to continue managing internal discontent without losing control of the legislative process. The government is expected to ram through a corrective budget for 2011 as a single text without line-by-line voting.
But he must also cross another minefield: Socialist-controlled unions are trying to stop planned privatizations, a key element in the second bailout. Unions at energy utility PPC have threatened blackouts if the government insists on selling a 17 percent stake in the firm.
Source: www.nationalreview.com
That’s unlikely to thrill German taxpayers. They are also unlikely to be amused by the photo (from May 30) of Greek protestors with which the article (in German, shockingly) is illustrated. And all this matters. As this piece in Reuters reminds us, the politics of getting the bailout through will be tricky:
It is unclear whether the new Greek rescue would be funded by the euro zone bailout fund, the European Financial Stability Facility, in which case German Chancellor Angela Merkel would not need to seek formal parliamentary approval. If the rescue were conducted outside the EFSF, she would probably have to go to parliament, exposing her to criticism from backbench rebels. Because Berlin is keen to keep the euro zone together, many analysts think Merkel will spend whatever political capital is needed to ensure German participation in rescuing Greece.
Quite possibly, and as her behavior over the EU’s Lisbon Treaty revealed, Merkel — who is in a number of respects a true child of the East Germany in which she was brought up — will bypass the voters if that is what it takes.
Reuters adds:
But support for the bailout in the Netherlands and Finland, while likely, is not completely certain. The Dutch government would be expected to seek majority support in parliament for fresh funding; the minority Liberal-Christian Democrat government would almost certainly win such support, but it would probably face opposition from its main ally, the Freedom Party, whose leader Geert Wilders is an outspoken critic of bailouts.
And then there’s the situation in Greece itself:
Political resistance to fresh austerity steps in Greece may be the biggest threat to a new bailout deal. The two main parties have been unable to reach consensus on a medium-term fiscal strategy; even if they achieve this, opinion polls show support for both parties dwindling, and Prime Minister George Papandreou faces a growing revolt within his PASOK party. A group of 16 backbench members of parliament from the ruling party on Thursday demanded a full debate on further austerity measures and privatizations. Papandreou’s party has 156 seats in the 300-member parliament, so he may be able to continue managing internal discontent without losing control of the legislative process. The government is expected to ram through a corrective budget for 2011 as a single text without line-by-line voting.
But he must also cross another minefield: Socialist-controlled unions are trying to stop planned privatizations, a key element in the second bailout. Unions at energy utility PPC have threatened blackouts if the government insists on selling a 17 percent stake in the firm.
Source: www.nationalreview.com
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