Let’s Talk Turkey About Greece
1) Greece is very likely to exit the Euro.
2) When Greece exits the Euro it will be punished severely by the monetary authorities. They intend to let Greeks starve. They will cut off food supplies, and Greeks will not be able to afford food. Oil is also going to be a problem. Greeks will probably not be able to flee to other countries.
3) The reason they will punish the Greeks is because they can. They couldn’t punish the Argentinians or the Icelanders, because both those countries can feed themselves. They can punish the Greeks. They need to make an example, because they are worried about Spain, Portugal, Ireland and other countries. (Heck, even the Dutch are having problems. The Dutch! If the Dutch can’t make it in the Euro, no one can.) This isn’t, contra Lagarde about “bad Greeks”, while it is true that Greece should never have been let in to the Euro, well, everyone knew that. Including the countries that let Greece in.
4) Greece is going to have get hardcore and creative about creating a new economy. Since the monetary authorities intend to starve them and deprive them of oil, they must retaliate hard. Greece has a number of options, and this is what Greece should do You don’t play nice with people who are trying to cause a famine in your country.
- Greece has a large fleet. Use it to strip mine the Mediterranean of all resources possible. Yes, the Med is a fragile ecosystem. If the other Euros don’t like it, they can not punish Greece, otherwise Greece will have to feed itself. The Euros could send fleets, but as the British-Iceland fishing war proved, that’s prohibitively expensive.
- Start gun-running and other black market activities up. European gun-running currently goes through Albania. Greece has much better ports. If the Euros don’t like it, they can militarize Greece’s borders at a cost much higher than feeding the Greeks.
- Become a full on black-hole for banking. If anyone wants to store money in Greece, they can. No questions asked, no forms needed.
- Make deals with other “pariah” and semi-pariah nations. Start with Iran and Russia for oil (Iran will be happy to give oil in exchange for black market help). Make a deal with various 2nd world nations for food, start with Argentina, they have no reason to love the IMF or the European Union, which promised to “punish” them for nationalizing oil in Argentina. In exchange Greece can offer use of their fleet, for cheap, and port rights for the Russian navy. They’ve wanted a true warm water port for some time. Offer them a nice island in the Med with a 30 year lease.
- Hold on for a couple years. Odds are that soon enough Ireland, Spain, Portugal and maybe others will leave the Euro. They won’t be in any mood to screw Greece for their ex-Euro masters. Heck, odds are 50/50 that there won’t be a Euro zone at all in 3 years, since Germany wants to screw everyone, including France.
- Nationalize basically every industry. It’s unfortunate, but it’s going to be necessary. Hundreds of billions of dollars have fled Greece in the past 3 years, in fact that was one of the main reasons for dragging out the “bailouts” (really, bailouts of German banks), to let the money flee. All Greek assets are going to be frozen overseas, so the Greeks will need to work with what they have.
- No more money goes out of the country. Slap on currency controls, to make sure what money is there doesn’t leave (this is aimed at Greece’s rich). If any banker or anyone else circumvents them, throw them in jail, the sentence should be life, generous, since they are committing treason.
- Seriously change the tax system, and insist on really taxing the rich. Go to heavily progressive taxation, reduce the burden on the poor (a large number of people now), this will buy support.
- A food rationing system, with cards and delivery to every person in the country will be necessary. It won’t be fun, but combined with the above, you can make sure that no one starves.
Greece has been under siege for years now, and traitors within its own country (its politicians) have betrayed it. This means Greeks are in serious danger of suffering a famine. The response to that, by Greeks, will have to be pragmatic and severe. If non-Greeks don’t like it, that’s too bad. When millions of people are in danger of starving, a country does what it has to.