Mon | May 22, 2017

Don’t stage Greek pappy-show here

Published:Sunday | July 12, 2015 | 7:00 AM

Forget all the classical references. What happened in Greece wasn't any high-culture tragedy. It was a Jamaican pappy-show. The referendum was a failure of leadership, a cruel joke played on the Greeks by irresponsible adolescent politicos. The poster child of this failure is the bike-riding former finance minister, Yanis Varoufakis, who was front and centre creating the last piece of the mess, then promptly resigned right after the referendum when the mess would begin to flow.

The proof of the souvlaki is in the eating. Tsipras came to power in January saying he would end austerity, reverse labour-market reforms, end privatisation and, generally, defy economic reality. Right now, after a resounding 'no' vote, he is back to proposing every single one of the 'prior actions' for a bailout that the creditors were demanding before the plebiscite. In other words, he has backed down on everything, and is essentially just begging more money.

He's come back with a proposed primary budget surplus, a plan to reform the value-added tax, a plan to raise the retirement age to 67, and to cut certain grants, all of which are virtually identical to what was being demanded before. He has accepted that differential taxes on the Greek islands must be phased out. The demand for debt relief has been dropped. These were all contentious matters on which he supposedly couldn't budge. Mind you, he's begging a lot more money, so if you calculate that sort of manoeuvre as a victory, you can go ahead and declare him victorious.

 

madman with legitimate causes

 

At first blush, I thought Tsipras simply a madman. After further investigation, I found out he was a madman with legitimate causes for grievance. The truth is that the European Central Bank (ECB) has been a full co-creator of the crisis. And if you burrow down a bit further, the problem is in the design of eurozone, which is fatally flawed.

But pointing to all that is like when we here in Jamaica would spend our time finding more and more expressive language to curse off the iniquity and inherent neo-colonial wickedness of the world-financial system. How far did that take us?

The Gleaner ran a splendid editorial ('Jamaica must remain adult') that may have caused some in Government to cringe. It recalled a 1980 PNP NEC wherein the decision to ditch the IMF and pursue an 'alternative plan' was taken. As The Gleaner drily noted: "The economy went into free fall."

Look, the 1980 IMF isn't today's IMF, and there's something about the earnestness of those NEC socialists, and the headiness of that history, that causes me to withhold the condemnation. But as they might say on the road nowadays: "Jesus wept."

But back to Greece! All that will happen now is that digging the country out of its hole will be harder.

If there's a lesson for Jamaica, it's what a bad idea it would be to sink back into our customary fantasy of believing that we can avoid economic reality. It's as if the gods put this Greek pappy-show on display for our instruction. Alas, the capital markets, just like our own local creditors, really don't care how we collectively 'feel' about our debt.

In fact, economist Damien King had this to say about the Greek mess: "I find it astonishing that anyone can look at the situation in the two countries and think that Greece is an example for Jamaica to follow and not the other way around."

This is true, but it bears repeating often, because there are an alarming number of opinionators who seem to imagine otherwise. And it seems to me that we will face our electoral version of the Grecian referendum in short order.

 

anti-austerity option

 

We need to understand something: For Jamaica, the IMF was the anti-austerity option! Left on our own, without IMF intervention, we would have been in some incredibly desperate seas. This is why every time I read or hear about 'IMF austerity', I immediately know this is someone in fantasyland.

How many of us would have been willing to travel down the path WITHOUT the IMF? I can see it now: riding donkeys to work, massive layoffs, an even spottier water supply, and electricity available to Upper St Andrew alone. If you think our fragile social structure is groaning under the IMF, imagine it without it.

When I see Greeks lining up relatively nicely and peacefully to try to draw maximum 60 euros a day, I marvel. Mek dem try dat inna Jamaica! Cutlass a go swing.

And let me be clear, my impatience is no different. For instance, I'm already exasperated with the incompetent handling of our water resources. When I'm trying to take a shower, I have very precise ideas about which minister of government I want to have on my mind, and the exact bikini that individual just happens to be wearing. But nowadays, standing beneath the alternative-day trickle of liquid, it's the water minister, and I vaguely feel like I should self-report to the nearest police station and pay a fine for de mounta badwud mi a cuss.

But I digress. The point is that we needed the IMF for Jamaicans to continue living above our means, which, let's face it, we all like. And we need it if we are to continue to spend, for our own enjoyment (sorry, 'development'), against our children's earnings.

That's the thing. We should be looking at this Greek pappy-show and thinking: "Been there! Done that!" No need to see that crappy pappy-show play again.

- Daniel Thwaites is an attorney-at-law. Email feedback to columns@gleanerjm.com.