"Unending ‘voluntary’ haircuts"

Two years, two Bailouts, and €240 billion of official loans later (the purpose of which was to prop up a once €250 billion economy whose debt had risen, unsustainably after the Credit Crunch, to €290 billion), what has the result been? Nothing to write home about: a shrinking economy (whose collective income will soon dip below €200 billion) and a still unsustainable debt that will, only by some miracle, fall to below… 130% of GDP in eight years. This is the stuff of fabulous failure. Not so, however, if you look at things from the perspective of bankers, hedge funds and assorted members of the global and european financial sector.

The greatest achievement of the Bailouts was to buy the financial sector two long years during which to unload their Greek bonds onto the official sector. Henceforth it is the official sector, alongside the crushed Greek people, that will bear the costs of a forthcoming Default 2.0. Of course, given what has been going on on both sides of the Atlantic since the Fall of 2008, it is not unknown for taxpayers (for this is who ‘hide’ behind the so-called official sector) to bear the brunt of a financial disaster. Indeed, Europe’s taxpayers have been shouldering the costs of the Crisis since even before it erupted (toward the end of 2007, that is). We are (wrongly) almost conditioned to accept that the costs of finance’s folly will be born by voiceless taxpayers. Be that as it may, there is another real issue, one that concerns the efficiency, or otherwise, of the way public monies were used to prop up the financial sector.

Read More | "What was it all for? The Latest Greek Bailout-PSI in the Morning After's Cold Light" | Yanis Varoufakis