Zeit für einen Schuldenschnitt in Griechenland

Apr 22, 2016 Mohamed A. El-Erian

WASHINGTON, DC – Griechenland steht einmal mehr an einem Wendepunkt. Angesichts stark beanspruchter Kassenbestände dürfte es kaum in der Lage sein, die in den kommenden Monaten anfallenden Schuldenraten zu bezahlen. Daher hat nun eine neuerliche Runde kontroverser, lang anhaltender Verhandlungen begonnen, die durchaus eine weitere kurzfristige Lösung hervorbringen könnte. Allerdings haben die Verhandlungsführer noch eine andere Option, als das Problem in die Zukunft zu verschieben. Tatsächlich wäre das der falsche Ansatz.

Wenn ein Land in ernsten Zahlungsschwierigkeiten steckt, stehen ihm fünf grundlegende Maßnahmen zur Verfügung. Es kann erstens auf die Geldreserven und das Vermögen, die es in besseren Zeiten aufgebaut hat, zurückgreifen. Zweitens kann es externe Kredite aufnehmen, um kurzfristig fällige Zahlungen leisten zu können. Drittens kann es zeitgleich oder mit Verzögerung im Inland Austeritätsmaßnahmen (wie Steuererhöhungen oder Ausgabesenkungen) umsetzen, die Mittel zur Schuldentilgung freimachen.

Viertens kann ein Land, das knapp bei Kasse ist, auch Strategien umsetzen, um das Wirtschaftswachstum anzukurbeln und so steigende Einkünfte herbeiführen, die für einen Teil der Zahlungen genutzt werden können. Und wenn nichts davon funktioniert, hat es noch eine fünfte Option: Es kann den Marktkräften gestatten, den Großteil der Anpassungen zu bewirken – entweder durch sehr große Preisbewegungen (unter anderen beim Wechselkurs) oder durch einen erzwungenen Zahlungsausfall.

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Mohamed A. El-Erian

Writing for PS since 2010
118 Commentaries

Mohamed A. El-Erian, Chief Economic Adviser at Allianz, the corporate parent of PIMCO where he served as CEO and co-Chief Investment Officer, was Chairman of US President Barack Obama’s Global Development Council. He is President Elect of Queens’ College (Cambridge University), senior adviser at Gramercy, and Part-time Practice Professor at the Wharton School at the University of Pennsylvania. He previously served as CEO of the Harvard Management Company and Deputy Director at the International Monetary Fund. He was named one of Foreign Policy’s Top 100 Global Thinkers four years running. He is the author, most recently, of The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse.

The Post-Crisis Economy’s Long Debt Hangover
Leonid Lazarev/Getty Images

The Post-Crisis Economy’s Long Debt Hangover

Carmen M. Reinhart says that the need for comprehensive restructuring is the elephant in the room for policymakers.

17
End “Extend and Pretend” With Greece
Giannis Papanikos/ZumaPress

End “Extend and Pretend” With Greece

Lucrezia Reichlin, et al. call on both sides in the debt negotiations to embrace a more realistic agenda.

6

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0 Comments on this paragraph, 29 in all 29 Comments on this article

Desiree Dogood Apr 28, 2016

Greek citizens, via who they elected, have made their own bed, and should sleep in it. Bailing out serial deadbeats, doesn't give them the freedom to be responsible for themselves. And leads to more defaulting. There's a lot to be said in allowing Greece to suffer the consequences of their choices, so they might learn change their behavior.

You can't have freedom and the prosperity that comes with it, without first being willing to give freedom to others. When Greeks keep voting for government to take care of them, at the expense of others, they won't have freedom because they aren't offering it to others.
- JAMES SUNTRES Oct 16, 2016
  
  JS
  SYRIZA and their ultra-right cohorts ANEL are a consequence of the failed policies plaguing Greeks. Yes, Greece is a clientelist and crony-capitalist state. Yes, many Greeks fail to pay their taxes. But most Greeks are not clients of the political establishment. Moat Greeks, including the few remaining successful Greek businesspeople, pay their taxes. Greece is a classical example of how the policies and practices of the few -- in Athens, Brussels, Berlin, and Washington (re IMF) -- are spoiling things for the many.
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- M M Apr 28, 2016
  
  The majority of the Greek people did not vote. Syriza and their coalition partners got only 18% of the total Greek electorate. Also the Greek people voted 62% against the bailout programmes in their referendum. If you need to blame someone, you should blame the German leadership that has got their fingers all over the place and the German people that elected them.
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Bernhard Kopp Apr 26, 2016

I understand the economist's view. However, how does an economist break the political deadlock that has been preventing Greek sustainable prosperity for 30 years ? A debt reduction will not help as long as the Greeks get away with 'wanting to eat their cake and keep it too'.
A new reply to this comment has been posted.
Paul Friesen Apr 25, 2016

So Varoufakis was right? What a surprise!
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margaret beresford Apr 25, 2016

The entire rape of Greece done by EU banks is scandalous and the pusher, Germany know it...If Greece doesn't take a page from Iceland and begin to simply, stop paying and start regaining its self-respect and internally heal its demoralized state to finally gain proper self-esteem. Imagine, listening to the heart break of a man with tears falling down his face, having to admit he would never be able to afford a family, let alone get married--so wrong, its criminal what banks have been given reign over....After all, they and they alone caused the 2008 financial crisis. Due to gambling in derivatives.....and the hedge funds are their suppliers with a 'criminal right to preferred creditor status' , wrapped within a 15% tax rate.....criminal...is right.
- Paul Friesen Apr 25, 2016
  
  I agree with you mostly, although we should acknowledge the role of past governments in Greece's troubles. But this in pointless, disproportionate punishment of the wrong people. The politicians who caused the problem are sitting pretty, while the youth of Greece, who could not even vote when those governments were elected, are put in a debtors' prison - punished for not paying "their" debt by being prevented from working.
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- Steve Hurst Apr 25, 2016
  
  @Magaret
  '... the heart break of a man with tears falling down his face, having to admit he would never be able to afford a family, let alone get married..'
  Oh come on, your Romeo has freedom of movement in the EU and can head to Germany or the UK or elsewhere if he wants. The UK monarchy has Prince Phillip who is Greek and done quite well, its not as though its never happened before
  The accomplice in the 'rape' of Greece was the Greek government with its fraudulent accounts. As for following the Iceland example - Tsipras had a mandate from the Greek people to do exactly that and bottled it.
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Oliver Denker Apr 24, 2016

"argues that, after eight long years, it is time to give the country the help it needs."

MOHAMED A. EL-ERIAN doesn't seem to know a lot about modern Greece's financial history...
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Per Kurowski Apr 24, 2016

That must begin by the Eurozone understanding more about who did it in.

http://subprimeregulations.blogspot.com/2011/11/who-did-eurozone-in.html
- Per Kurowski Apr 25, 2016
  
  If your regulator allows you to leverage only 12 times to 1 when lending to SMEs but about 40 to 1 with mortgages or over 60 to 1 in AAA rated securities... where do you think banks will go in oder to obtain the highest risk adjusted returns on their equity? ... and by the way give me one single bank crisis that has resulted from excessive exposures to something perceived as risky when booked... these have always resulted from excessive exposures to something believed safe... like real estate in Spain :-)
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- Steve Hurst Apr 25, 2016
  
  @Per
  
  Where is this idea from that banks are 'allowed' to leverage more. Banks have buildings full of analysts and risk assessors, it is the banks responsibility to excercise due diligence. Lousy regulation and stupid borrowers dont help but ultimately it is the bank authorising the loan. You do not have authority without responsibility
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- Per Kurowski Apr 24, 2016
  
  When you allow banks to leverage more on "the safe", then they earn higher risk adjusted expected returns on equity with "the safe", so then they end up lending too much to "the safe" C'est la vie
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- Steve Hurst Apr 24, 2016
  
  @Per
  
  Lending may have occurred without sound risk assessment, however there is still responsibility for the borrower not to go large on stupidity. Just one example - more housing being constructed in Spain (1 c0untry) than the rest of the EU combined (27 countries); and nobody anywhere thought it was over the top?
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Georgios Poukamissas Apr 24, 2016

I think that among other things the reduction of the fiscal primary surplus now imposed at 3,5 ./., to maximum 1,5 ./. Is absolutely necessary. The country s remaining production capacity has severely been affected under the current fiscal adjustment and structural reforms program.
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Peter Schneider Apr 22, 2016

Any debt-reduction in which other member states of the eurozone have to bear losses is in violation of TFEU art. 125 and thus illegal. This includes direct debt write-off but also lending below market prices. Greece has several options described in the article to relieve its payment problems but it has not the option to ask other member states of the eurozone to pay. If if it is not able or not willing to abide the rules then it has to leave. If it does not leave then it has to be expelled. If it is not expelled then, after a while, the whole monetary union will break apart because a community in which the common institutions are in permanent breach of the rule of law won't exist for much longer. And the "EU" institutions (including the "E"CB) have not much credibility left.
- Peter Schneider Apr 25, 2016
  
  @Georgios:
  The fundamental structural principle of the Maastricht treaty is that no member state has to guarantee for the liabilities of another member state. In that way it was communicated to the German public. E.g. in the CDU manifesto in 1999: "The Maastricht treaty explicitely prohibits that the European Union or the other EU partners have to guarantee for the debt of a member state." There is nothing like a "broad interpretation" which could in any way be circumvented.
  
  Regarding your quotation from this (rather Pro-"EU" biased) blog: Don't you have to laugh if you read the following? "If the granting of financial assistance in the form of the creation of a new debt, under strict conditionality, is not to be qualified as assuming the commitments of another Member State, it is difficult to argue that the granting of further assistance in the form of the reduction of that same debt by the same creditor, again under strict conditionality, should be judged differently." In other words: 100% of the Greek public debt lies with the other euro member states - under strict conditionality of course, hahahaha - but this is not assuming the Greek commitments? Hahahahahaha.
  
  Regarding the "E"C"J" - this is just one these rotten "EU" institutions that I absolutely reject and that I deny any legitimacy whatsoever to overrule a national Supreme Court.
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- Georgios Economou Apr 25, 2016
  
  The violation you mention arises after broad interpretation of TFEU art. 125. Such broad interpretation is not allowed because it infringes fundamental structural principles of the Treaties.
  As to the alleged violation of TFEU art. 125 see the case "Thomas Pringle"
  
  (http://curia.europa.eu/juris/document/document.jsf;jsessionid=9ea7d0f130d5f7f10b5528a94afd99fcea10be0c526e.e34KaxiLc3eQc40LaxqMbN4OchmTe0?text=&docid=130561&pageIndex=0&doclang=EN&mode=lst&dir=&occ=first&part=1&cid=162763 )
  
  and the remarks of Law Professor Carsten Gerner-Beuerle at the London School of Economics and Political Science.
  
  ( http://blogs.lse.ac.uk/europpblog/2015/07/22/there-is-little-legal-basis-for-wolfgang-schaubles-claim-that-debt-restructuring-is-incompatible-with-euro-membership/ )
  
  Look your facts next time
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- Peter Schneider Apr 24, 2016
  
  @Peter:
  Of course, you are right. You have to be careful these days with the number of zeros you have to choose. So, the German Target balance stands at +605 billion euros (Feb. 2016, source "E"CB). And my other numbers also lacked some zeros - I meant trillions instead of billions.
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- Peter Schaeffer Apr 24, 2016
  
  @Peter
  
  600 million Euros and rising was probably meant to be 600 billion Euros and rising...
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- Steve Hurst Apr 23, 2016
  
  @Peter
  
  Have you ever seen those circus acts where the guy stands with his feet on two horses, one on each. If they drift apart it all gets shakey and you can see the inevitable coming sometime before it happens and he falls down in between the two horses. By some miracle sometimes the horses move back together and he breathes a sigh of relief and goes to the rest room. Thats were we are at the moment. Then the clowns come on with the car that falls apart....
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- Peter Schneider Apr 23, 2016
  
  @Steve:
  It is impossible to avoid the impression that the tide is turning in Germany. Five years ago the German elites were still able to nip any dissenting opinion in the bud but now they increasingly face a real opposition. Contributing to this development is certainly the migration crisis where their failure is visible on the strees - other than the currency crisis where their failure is hidden in shadow banks. In a recent state election in Saxony-Anhalt (in many respects a special case but nevertheless), the euro-supporting parties (I would call them anti-European) only received 52% of parliamentary mandates and had to form a very strange coalition. Overall, the opposition currently stands at around 20% according to recent polls which would give them around 25% of the mandates in the next Bundestag. With that, at least, those Night and Fog operations to blindside parliament (like they did with the ESM decision) would become difficult for the German elites. But the AfD party alone aims at 30% at the general elections next year as their spokesperson Mr. Meuthen announced. And if they were able to reach that, blocking the ESM would maybe become into reach.
  
  So, yes, the German population will walk when the final bill is presented. At the moment, the German elites only present their successes to the people, but those are only shot-term benefits owed to the highly undervalued currency. Most Germans still don't know about the Target credits (>600 million euros and rising), they don't know about the ANFA programme (credits of an amount unknown to the public), they don't know about the OMT programme (guarantees of unknown amounts, possibly >1 billion), they don't know about the planned common deposit insurance (also guarantees worth possibly >5 billion euros). They don't know because none of these programmes was approved by the German parliament. Weighing up these downsides, I can't see Germany as the beneficary of the Euro. Our democratic culture,our economic culture, our monetary stability, our social stability are all in fact being undermined by the "EU". For Germany, the Euro is certainly a Trojan horse.
  
  Regarding the historical perspective, the Monnet doctrine (though inherently anti-democratic, intransparent and designed to guide economical processes like syndication and not to guide political union building) might have been appropriate for the 50s and 60s. And until 1992, I would say, that the "EU" was still democratically controlled. So the mistake was maybe not to start with the Monnet doctrine but not to abandon it later. Therefore, I would see the responsibility for "EU" failure more with Delors than with Monnet.
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- Steve Hurst Apr 23, 2016
  
  @ Peter
  'Europe’s nations should be guided towards the superstate without their people understanding what is happening. This can be accomplished by successive steps, each disguised as having an economic purpose, but which will eventually and irreversibly lead to federation'. Jean Monnet, deranged economist and European federalist engineer
  
  A common currency area between similar economies is easy to understand. Without perpetual subsidy to poorer areas if those are included it is a disaster. The EU is a political entity from birth and pretty much every action is driven by politics not economics
  
  You are looking at the stresses building up in a one-way road system causing increasing gridlock. The strength of democracy is the ability to respond flexibly to new conditions. That strength is the very thing the structure of the EU degrades. The Euro is the Trojan Horse inside the walls. Germany is the beneficary of this so far. The German population will walk when the inevitable bill is presented and they fully realise the problem. Just like they are saying hang on a minute about Merkels open house migration policy (Merkel popularity is 33% down from 75% April 2015). The irony of the migration issue is Germany need 8 million young to ofset its aging demographic but practically and domestically cannot absorb 500K refugees and 500K economic would be migrants. Germany dominates the EZ and as Germany atrophies economically EZ issues will grow. Italy and France have problems pending. It can only get worse and it is probabe somebody is thinking that cash should be stockpiled for that eventuality rather than invested in infrastructure which would help overall
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- Peter Schneider Apr 22, 2016
  
  @Steve:
  I was very surprised about Mr. Praet when he said before the German constitutional court that monetary union means transfer union as this is exactly what is explicitely forbidden by law. So, yes, it has turned out that EMU cannot function the way it was constructed and that all promises before its introduction were lies and all treaties for the implementation of stability rules were betrayals. A Greek debt write-off would mean the expulsion from the eurozone more or less automatically because it would become politically untenable to continue otherwise. And the argument works the other way round: the Greek side would get the debt write-off for reintroducing the Drachma. Of course, it destroys the project, but the "federal mentality" only exists within a small elitist group anyway and is not shared by the wide majority who prefers to retain a national right of self determination when things get serious. Even more so now that the "EU" institutions as "guardians of the treaties" appear more or less discredited. I don't know what the idea behind EMU was. Did they really think that they could enforce a European federation? Or were they just dreaming? Or was the idea to weaken Germany and thereby take the whole continent as hostage no matter the costs? Later generations of historians will find out.
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- Steve Hurst Apr 22, 2016
  
  @Peter
  
  For the Eurozone to function with disparate economies it has to pertetually enable wealth transfers from wealthy to poorer areas. As this cannot happen all that can occur is the relentless build up of localisied debt and economic decline. There can only be one outcome. As localised decline occurs grant aid can be provided but would invoke a political backlash if it was on par with a debt write-off. My money is on Greece not being in the EZ medium term and being given sweetener write-off and transitional money as a package. It however destroys the 'only one road ahead' federal mentality. As such the EU has already failed by its own inflexible construct. (Ditto Schengen concept)
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Steve Hurst Apr 22, 2016

Merkel has stated that debt write-off legally cannot occur within the Eurozone so I dont see much negotiation. The IMF position is more interesting as they wish to see write-off
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M M Apr 22, 2016

Add to this mix the “Euro Trap”; the German leadership Intransigence”; the “Dysfunctional EU”; the below mediocre Greek Leadership”; the overburdened / bankrupt Greek economy; the reliance of sovereign lenders on Greece remaining their conduit for channelling fictitious funds; the continuous meddling of the EZ in the Greek Affairs and the imposition of endless conditions; etc.
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Dimitrios Papagiannopoulos Apr 22, 2016

The 3d MOU signed last August provides sufficient funds to cover all Greek debt due for repayment until 2018. Cash balances are indeed running low as "prior" measures aiming at fiscal sustainability have not, as yet, been implemented and the gvmt cannot draw from the ESM funds. (the 1st review of the current programme is 5 months due). The level of debt, as such, has not had any influence on the developing situation.Perhaps it would be of benefit if Tsipras had a tutorial on the lines of N. Kocherlakota's column :(http://www.bloombergview.com/articles/2016-04-18/watch-the-u-s-budget-deficit-not-the-debt)
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Walter Gingery Apr 22, 2016

China, meet Greece.
A new reply to this comment has been posted.

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