Merkel Piles On: No Greek Relief

Just in case the Greek government didn’t get the message delivered in person by German Finance Minister Wolfgang Schaeuble during an 11-hour visit to Athens that there would be no imposing losses on the country’s lenders – Germany being the biggest – Chancellor Angela Merkel brought the hammer down again warning Greece not to even think of another debt write-down.
Merkel, who didn’t oppose Greece putting 74 percent losses on private investors in 2011, said no way is that scenario going to happen to the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) that is putting up $325 billion in two bailouts to prop up a Greek economy killed by generations of wild overspending and hiring hundreds of thousands of needless workers.
If Greece were to give its public lenders a so-called “haircut” – some analysts said as much as 40 percent or more is needed – that would leave it to taxpayers in Germany and the other 15 Eurozone countries to pick up the tab for Greece’s 40-year-spending spree. Merkel said that would undermine the Eurozone.
Schaeuble had said the Greeks should stick to reforms instead of whining about not being able to pay what it owes as Greek Prime Minister Antonis Samaras floated a trial balloon about whether Greece could be allowed not to pay all its debts.
Merkel pointed to the possible consequences of another writedown in the 17-country Eurozone and the danger that others might seek a similar deal. Portugal, Ireland and Cyprus have also received bailouts.
She said another debt relief deal “could lead to such massive uncertainty among all investors in the Eurozone that everything we have done in recent years would again be in question.” She’s also anxious to keep Europe quiet while her party faces elections in September.