Sunday, February 22, 2015

Did Eurozone Finance Ministers Just Kick the Can Down the Road on Greece?

German Finance Minister Wolfgang Schaeuble isn't kicking anything.

I have seen some television commentators refer to the 4 month extension given Greece on its bailout as "kicking the can down the road," but that is decidedly not the case.

The fine art of politically kicking the can down the road generally means moving problems years down the road, ideally when the current negotiators have long moved beyond their current positions.

A 4 month extension does none do this, it is what it appears to be, eurozone ministers giving the newly elected Greek government a chance to get its negotiating thoughts in order.

Rest assured, the eurozone ministers are not playing here, the current stalemate will be over in 4 months one way or another.



  1. In a world where events are moving especially quickly, couldn't four months be a suitable can kick? Think of everything that could happen between now and then -- Podemos in Spain, escalation in Ukraine, Turkish alignment to Russia, any number of unknowns. I don't think we should underestimate the artifice of the Greek negotiators -- Varoufakis is a "libertarian Marxist", that's simply inspired, and it is too soon to know whether this latest deal is not some kind of feint. Amidst such uncertainty four months seems ample time for the calculus on both sides to change completely.

    1. what they are doing is taking the story off TV News and out of the headlines. Now they discuss the deal out of the spotlight.

  2. The 4 month can-kick gives the Greeks a longer window of opportunity to remove whatever meager savings they have out of their banks, gives Syriza a chance to print a mountain of drachma, and gives European politicians a chance to figure out how to stick its taxpayers with the tab without ushering in a tax revolt.

    On the other hand, if it was meant to actually solve the ingrained and systemic problems that face the Eurozone, it failed miserably.

    Anyone here in America that isn't sedated by iGadgets and Hollywood should be taking notes, because the debt monster will soon crash upon our shores. We are the next Greece. We can't pay our bills either.