Greek Bailout: Who Will Actually

Greek Bailout: Who Will Actually

Get the Money?

The depravity of the European leadership is seen in the proposed bailout for Greece. After five years of destruction of the Greek economy, reducing it by more than 25% driving official unemployment to 27% and real unemployment to over 40%, and impoverishing 40% of the population, they are proposing that the country add between EU86 and 120 bn to its debt in order to... pay back existing debts.

In fact, the creditors of Greece have carried out a campaign of blackmail and ultimatums aimed at destroying the Greek banking system which is an integral part of the euro system, unless it relented to the creditors’ demands. Zoe Konstantopoulou, President of the Greek Parliament, rightfully pointed out that blackmail is illegal, and the creditors’ policy is nothing less than a crime against humanity. Furthermore, the Greek Truth Commission on Public Debt found that same debt to be illegal, unfair, odious and unsustainable (cf. SAS 26/15).

In addition to the Grexit proposed by Wolfgang Schäuble, with debt restructuring by the Paris Club, the liberal Greek daily Kathimerini reports that the European Commission itself had drafted a Grexit plan. If implemented, according to one source involved, “tanks would be heard on the streets of Athens”. The report is said to be in a special safety room near the office of EC President President Jean-Claude Juncker.

The new debt is not going to help the Greek people, that is clear. But who will get it?

The European Economic and Financial Affairs Council (Ecofin) approved a so called “bridge loan” of EU7.16 bn to cover debt payments while the new bailout is negotiated. Of that EU4.5 bn was to go directly to the ECB on July 20 to pay interest on Greek bonds held, and the rest to the IMF to cover the payments Greece failed to make at the end of June. Later in August, another payment is due to the ECB, which Greece, without a bailout, will not be able to make.

Otherwise, the popular Greek website DefenceNet published a preliminary breakdown of how the money will be distributed:

* EU29.7 bn for loan repayments to the Eurozone;

* EU9.9 bn to the IMF;

* EU5.5 bn to private debt holders;

* EU25 bn for recapitalization of the banking system (which was destroyed by the ECB’s cut off of liquidity);

* EU17.2 bn in interest payments on debt;

* EU7 bn internal debts;

* EU7.7 bn for the liquidity of the banking system.