The horizon is not so far as we can see, but as far as we can imagine

Syriza Will Put Bailout to a Referendum

This is a correct action. 

In an unexpected move, Prime Minister Alexis Tsipras went on national television early Saturday to call for a referendum on July 5 so that Greek citizens can decide whether to accept or reject the terms of a bailout deal proposed by the country’s creditors.

This is now a democratic decision. I hope the Greeks say “no,” but it is their decision, and the consequences of either vote will now be their responsibility.

Meanwhile, this will apparently be the German newspaper Bild’s headline tomorrow.

Bild Greek Referendum Front Page

Apparently, democracy is now “blackmail.” Also apparently, I was wrong about Europeans not being willing to be open in their contempt for popular sovereignty.

Blessings upon the Greeks. They will need them.

If you enjoyed this article, and want me to write more, please DONATE or SUBSCRIBE.


I Am So Happy About Gay Marriage Being Legal in the US


Finance Ministers Refuse an Extension to Their Offer to Greece


  1. Peter

    Direct democracy is a huge threat to the Ruling Class in Europe and it must be suppressed before it spreads so expect severe and swift punishment if the Greeks reject this authoritarian ultimatum.

    I was very pessimistic about this crisis but this is a historic move towards real democracy with the citizens directly making decisions about critical issues, as they should be, but have never been allowed under an easily manipulated representative regime.

  2. As soon as I saw this off of Paul Mason’s twitter feed I nearly whooped out loud for joy. The timing is absolutely perfect — it forces ECB to choose whether or not it will interfere directly in a referendum, as Greece won’t be able to pay its next loan tranche over the referendary period. I would like to believe that Tsipras gamed this out way back when.

  3. Ian Welsh

    Don’t you have some writing to do? 😉

  4. Jeff Wegerson

    The wording is so very critical. Sryriza’s election was already a no vote against austerity. Another vote against austerity will simply be treading water. For the referendum to be successful it must offer a chance to vote for something that will move the situation forward for the Greek people. One such option would offer a choice like “accept more austerity” or “create a Greek currency”. I get that I have presented it in the terms we here at this site see it. So yes maybe the wording is different or there is some other real option offered.

  5. Ian: yeah yeah. I’m getting there. 🙂 When I write it usually goes down to the wire, heh.

    Jeff: No, the correct choice is: whether or not to accept the last creditor offer. That’s IT. This forces the creditors to decide whether they want to campaign for a bad plan. It forces the creditors to directly confront Greek democracy, which is precisely what they have been avoiding.

  6. Pluto

    Uh oh.

    The last Referendum in Europe (where the universal human right of Self Determination was exercised) was the referendum held in the largely ethnic-Russian East Ukraine, where the people voted to remain in Ukraine, but called for West Ukraine to form separate republic that would ensure their personal security. This, after the President they democratically elected to a second term was overthrown in a US-sponsored coup in West Ukraine.

    Four thousand of those ethnic Russians were immediately slaughtered in East Ukraine — (West Ukraine has never been attacked, of course.) — and now nuclear warheads have become the big swinging dicks in the region.

    “You’ve got a nice country there, Greece. We’d hate to see anything bad happen to it.”

    Russia, China, and the BRICS are standing by to aid Greece in its quest for democracy. A proxy war in the making. This is why we can’t have nice things!

  7. Peter

    Pluto, Russia is in no position to offer Greece much more than it already has with the pipeline deal which is strictly business. China is already ‘helping’ by buying up Greek public assets, port facilities, at bargain prices. The rest of the BRICS are hardly booming economies and are working on protecting themselves from the Hegemon and its dollar dominance.

    Conflating Russia and China with democracy is a bit of a stretch although the same can be claimed about the US and democracy.

  8. Pluto

    @Peter. Russia, China, et al, can proactively offer Greece substantial structural loans (through the AIIB and the BRICS Development Bank) if Greeks vote to default and to seek independence from the EU, as an autonomous nation. This has been discussed over the past six months, between Greece, Russia, and China.

    This financial support will be vital during a time of transition, including the establishment of a new domestic currency and the nationalization of their banking system. They have a sufficient military and vast military resources. Functionally, it’s achievable. A lot of new paperwork and documents to be issued to citizens. There may be a disentanglement from NATO, which should be orderly.

    China will play an important role as a settlement bank for their trading markets, if Greece chooses to use its own currency. (Fortunately, the US Dollar is completely unnecessary for global trade, now.) Russia has already created a SWIFT substitute and China’s version will go live in the fall. Actually, I don’t think Greece can achieve their self-determination goals as a nation without Russia and China and the global systems they have created after the Ukraine coup.

    Of course, there is the risk that the US Vassal States of Europe could turn rabid and violent, as they did in Ukraine. Greece is, after all, is the geostrategic jewel of the Mediterranean.

  9. Peter

    I can’t claim to understand all of what might or will happen in Greece but some facts are relatively clear. The Greek debt is about $340 Billion and they cannot even make payments on this debt, the total projected funding for the BRICS Bank is $200 Billion, the AIIB is an infrastructure bank for developing countries and the demand for its funds already outstrips its funding. Even if the BRICS bank agreed to help Greece, that didn’t happen at the last meeting, what would be the terms and how can Greece prove they will or can pay those loans back? China, the power and money behind the BRICS Bank isn’t a charity operation and neither is Russia. They may want to draw Greece into their economic and political sphere but there are limits to what they will or can do to help Greece.

  10. Pluto

    Granted you are quite right, Peter. Thanks for the response.

    But to be clear, Russia and China’s involvement only occurs if Greece defaults. Greece must owe nothing at the point that the NDB or AIIB step in. Thus, they are senior to any former creditors. As well, the Greek government is quite flush financially, when you remove all former debt or debt servicing of IMF/Bonds. Indeed, for the Greek people, austerity will be lifted, and they will be able to grow their economy. There is NO reason why current revenues or income streams for Greece would be interrupted.

    Now, here is the extraordinary beauty of the situation for Russia and China and the rise of Eurasia: Greece is at the geographic epicenter of the game-changing New Silk Road Economic Belt. Of the top 10 biggest container ports in the world, no less than 7 are in China (the others are Singapore, Rotterdam, and Pusan in South Korea). Greece is a perfect fit for the AIIB; its maritime advantages are key connectors for the entire Eastern Hemisphere.

    For Russia and the NDB, Greece has been a pivotal asset over the past year. After the Ukraine coup, Gazprom’s new gas pipelines to service Europe’s energy needs was diverted to Greece. Thus, Greece will be the transit point for Europe’s future energy supply.

    The double fiasco of Greece + Ukraine has been a real oracle. Pepe Escobar offered a colorful description of the multi-polar goings-on, back in March:


    Moscow – diplomatically – has been the winner. And Russia won again when Turkey – fed up with trying to join the EU and being constantly blocked by, who else, Germany and France – decided to pivot to Eurasia for good, ignoring NATO and amplifying relations with both Russia and China.

    That happened in the framework of a major ‘Pipelineistan’ game-changer. After Moscow cleverly negotiated the realignment of South Stream towards Turk Stream, right up to the Greek border, Putin and Greek Prime Minister Tsipras also agreed to a pipeline extension from the Turkish border across Greece to southern Europe. So Gazprom will be firmly implanted not only in Turkey but also Greece, which in itself will become mightily strategic in European ‘Pipelineistan’.

    Russia and China, meanwhile, will keep betting on Eurasian integration; strengthening the Shanghai Cooperation Organization (SCO) and their own internal coordination inside the BRICS…. And as much as the Obama administration may be desperate for a final nuclear deal with Iran, Russia and China got to Tehran first. China’s Foreign Minister Wang Yi was in Tehran two weeks ago; stressing Iran is one of China’s “foreign policy priorities” and of great “strategic importance.”


    Greece is the grand prize for both Russia and China, and the New Silk Road.

    As things stand, both Greece and Ukraine could default on the EU/IMF in July.

  11. Pluto

    *** The Greek GDP can expect a significant increase from gas transit and maritime port fees, which would suffice to service the debt from the Eurasian development banks.

  12. Ghostwheel

    A toast with wine, if they vote no. Whiskey until I pass out, if they vote yes.

  13. Lurker the Third

    A “No” vote on the referendum would empower Syriza to push forward, and as a demonstration of the will of the Greek people, could help prevent a military coup.

    (It would be difficult for the Greek military to claim they had to intervene to “save” the county when the people had just voted directly against the policies the coup would have been installed to produce.)

  14. I just read Yves Smith’s blistering assessment of Tsipras’ plan and I had to say something. I don’t know where to start. I always thought she was on the wrong track, but I can’t believe HOW wrong her moral and political assessment of Tsipras’ referendum action really is. This was always a conflict of cultural narratives in part (and yes, Ian, I am writing, ETA tomorrow morning, heh) as she acknowledges at the end, but she insists on treating it as though it was some sort of corporate merger, I guess.

  15. mike

    Smith has treated this from the beginning as if it were merely some boardroom negotiation like she self-proclaims to be so wonderful and experienced at herself, and it really makes you wonder about the stands and info she’s provided on other things in the past. It’s been really noticeable how slanted the links there tend to be (Illargi at Automatic Earth has had a far more balanced view from the beginning but only gets linked to on non-Greek matters these days), and she took to calling those on fixed incomes who can’t subscribe to her blog “trolls” if they disagreed with her. Lambert is still worth reading in the afternoons during the week for his links post, especially on water and climate issues, but that’s the only thing there with credibility now that she’s gone so far off plumb over the Greeks.

  16. JohnB

    Well, Yves is exactly right in pointing out the referendum is pretty much a ‘sham’ – what exactly are they going to have to vote on next weekend, when the deadline is this Tuesday?

    Just makes no sense at all. I would be all for a referendum on this issue, except it is simply too late to have one now.

  17. The prospect of an agreement was *already* a sham. The creditors themselves couldn’t agree. They were rushing to take back their last proposal anyway, on account that it didn’t apparently soothe the bloodlust of the German and Finnish parliaments. There was no agreement possible at a political level from a long time now that didn’t involve total Syriza capitulation. Now Syriza is offering to capitulate — if Greeks agree. And it’s now the choice of the other political actors whether or not, in the period that Greeks are supposed to agree, to pull the plug and pre-empt democracy.

    All that was going on for the past two weeks was a game of pin-the-blame-on-the-donkey. In that game, Greece has now played the best card it can at the best time it can, if the referendum plan goes forward. And we will see what the creditors do on Tuesday.

  18. I mean, part of the point of the move, as I see it, is exactly that the expiry date is the 30th but the referendum date is the 5th!

  19. Peter

    It’s telling that real democracy is called a ‘sham’ when it bypasses the rich and powerful who normally control the levers of power. We saw this attitude in the halls of power and opinion when the people of Crimea and the Donbas took power into their own hands.

    Mob Rule, as they call it, truly frightens the elites and their minions because when it is exercised people may soon realize they don’t need the political and economic parasites who think it is their divine right to make decisions for the unwashed masses.

    Greece may technically default before this referendum but nothing will really change because of that. What is important is that the Greek public is going to directly make the decision on how to proceed and that Tsipras/Syriza need a new mandate to at least threaten the Gretex which the Greek public did not previously support.

    This is an extremely difficult decision because the Greek people are deciding whether to take a stand against the Troika that may mean more poverty, displacement and suffering to regain control of their country.

  20. Pelham

    I think JohnB raises an interesting point about the referendum coming a week after the deadline past which Greece will be in default.

    I don’t know whether its makes no sense, as JohnB says. But it what sense would the odd scheduling make sense?

    Perhaps Syriza just waited too long and a referendum can’t practically be carried out by Tuesday, in which case it’s a big mis-step on their part. Or perhaps it’s a bid to pressure the creditors to give them another week. Or perhaps it’s a backhanded way of telling ordinary Greeks to pull all their euros out of the banks so they’ll have a little cash to live on while Greece transitions to a new drachma.

    Personally and quite seriously, I like to think that Syriza — backed into a corner — is now just trying to scramble the playing board and confuse the hell out of everyone.

  21. JohnB

    Well, both replies seem to be missing the point: What, exactly, are the Greek people going to be voting on?

    After Tuesday, the entire premise of the referendum is gone – they won’t have a deal to vote on – so after Tuesday, what exactly is it, that the vote will be about?

  22. JohnB

    (That is, the replies from Mandos and Peter)

  23. hvd

    JohnB –

    Plainly, Tsipras is saying that he believes the Troika was not negotiating in good faith and he can’t accept their take it or leave it offer unless the Greek people agree. In effect he is saying to the Troika that they have gone too far with him and with what he believes he can accede to based on his mandate and that the deal is dead unless the Troika gives the Greek people the opportunity to change his mandate.

    Deadlines of this sort need not be absolute (they aren’t after all) and Tsipras is telling the Troika that they can get what they want if they wait one more week and the Greek people agree. Of course, as we see today, the Troika really doesn’t want a deal after all. What Tsipras has done, having recognized that the Troika was merely setting him up for the fall, is prove this point to the Greek people who will now have no choice but to accept his leadership into the future. Unless, of course, the Troika rely on the Greek military to make it clear to the Greek people that their role is simply to continue in bondage to their northern masters.

  24. Peter

    JB, I don’t think the Banksters in Europe will call these notes if the payments are a few days late and they may not even let the Troyka refuse to transfer the funds to make these payments, we will soon see if I am right or wrong and besides Greece has actually been in default for years.

    By standing firm to their mandate Sryriza has drawn out the Troika to expose that they won’t even allow Greece to control its own tax policy or govern as an independent nation.

    The choice the Greek people will make on the fifth is whether they will submit to totalitarian rule or stand with their representatives in their government and face the consequences of that decision.

  25. guest

    On a lighter note, I love the full version of that picture of Tspiras – walking away and turning his head back, as if to say “Take a good long look at my shapely behind, which you are welcome to kiss before I head out the the emergency exit momentarily”.
    He really has a nice butt. Don’t see those often on politicians.

Powered by WordPress & Theme by Anders Norén