Schaeuble marks a chance of saving Greece

German Finance Minister Wolfgang Schaeuble ruled out on Saturday the possibility of creating a new bailout plan for Greece. He said that there are limits to the aid that could be granted to Athens. This ultimatum makes the situation around Greece almost clear, as Germany is the main donor of bailout funds and without its agree no one can give money to troubled governments.

Schaeuble words sound like a verdict to Greece that for 3 years was granted of nearly $300 billion of bailout funds, plus $130 billion of debt-erase, and achieved no any improvement. The country still has an enormous deficit and in fact can not pay its own expenses (pensions, salaries) without foreign financial aid.

But in fact this is not verdict, but a cure. The problem in Greece is the foreign money it receives. The international funds are a disease that worsens more and more the situation of the country. When receiving easy money Greece has no motivation of implementing reforms. For instance, the firing of useless state employees is nowhere. Even more officers are appointed than are fired. Greece is doing no reforms, it just cries for more and more aid. This month the government acquired another emergency help of 4 billion Euros - newly printed by ECB.

The Greece is so deeply infected by international aid virus that it even can not think of reforms. The only thing that newly appointed prime minister Samaras wants now is... a new postponement of reforms schedule. I.e. again not making reforms and continue eating other's money.

This situation can not be endless. Greece is going down and down and can not revive its economy.

It is clear that this horror spiral must be broken. Greece needs a new start and a stable perspective. Obviously the only way to this is the reforms to start. And the needed trigger is the end of the stupidly generous financial help.

Let's hope this time Germany will not step back again and make a compromise. It will a bad favor for Greece...

August 19th 2012

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