Ode on a Grecian U-Turn

 | Feb 09, 2012 | 10:00 AM EST  | Comments
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There was a time in elementary school when you would beg your parents to say you're sick if you didn't have some homework done. In high school, you could probably talk your way out of a couple of assignments. By undergrad, a few extensions on papers or tests could be standard. In grad school, you could go a year with only incompletes if you wanted and roll into your eighth year still tweaking that dissertation.

If we postulate that the technocrat discussions between the troika and Greece are at a post-doctorate level, those people could be in that conference room for years.

After a couple of overnight head fakes, including a Guardian story reporting a deal that later became less of a deal, we're back in no-deal territory.

The meeting is moving to Brussels now, presumably because it will be easier to translate documents into Greek in Belgium.

In short, the Greeks fighting against 300 million euros of cuts expected to come from pensions. The latest is that they have until Sunday, but the last and final deadline for the deal was last Sunday, so make of that what you will.

It's not surprising that Greece wants to fight for its pensioners, despite international criticism that it is overpaying them. These are people living on an expected fixed income and it will mean a huge upheaval if payments are slashed. And, of course, the retired may not protest every day, but they vote.

In different times there may have been a deal already. Greece really needs the money and really doesn't want to default or leave the euro.

But these discussions are taking place in a post-TARP reality. The moment investment banks were declared too big to fail the view of financial assistance changed. Merrill Lynch is too big to fail, but Greece isn't? Why isn't Greece's huge government spending defended as bold, leveraged risk-taking that should not be regulated? Why isn't the Greece's government clamoring for unlimited pension bonuses to prevent a retirement-age brain drain? Why just bankers and not us?

These questions from its citizens won't go away after the latest tranche is delivered, either. As many have noted, Greece is still stuck with its same economic problems after the arrival of 130 billion euros and its ability to even implement all the austerity measures is questionable. That cycle of austerity and debt can be as cryptic as Keats' most famous, least understood line:

"Austerity is debt, debt austerity," - that is all

Ye know on earth, and all ye need to know.

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