Greece and Germany equally guilty.

Greece paid back 450 million euros to the IMF yesterday but whether it signifies a turnaround in its fortunes or has merely postponed the expulsion of Greece from the Eurozone we do not know. Such is the nervousness in the markets that Asian shares have gained even though Greece has been told to come up with a revised list of reforms which will satisfy EU finance ministers, who meet in 6 days, to consider whether to give further bailouts to it. But if Greece has already been given billions in bailout money why is it still in crisis? Because the money is to pay its international creditors, which are European banks. In effect what Germany and the EU are doing is to transfer the loans from the books of their banks to the Greek government, while imposing severe cuts in government expenditure apparently to balance its accounts, which means that the people of Greece will be paying off the loans for generations to come. Greek Finance Minister, Yanis Varoufakis is right when he says that if his country is unable to pay its present debts what is the use of piling on more. Instead he wants that Greece should be allowed to increase public spending and the private sector should be stimulated to create jobs, which will increase tax revenues, and repayments of loans should be postponed to give the country time to pay its creditors from revenues, rather than from more loans. The German press has portrayed Greeks as uncouth while Greece has portrayed German Finance Minister, Wolfgang Schaeuble as a Nazi. Greece is now asking for 279 billion euros or $303 billion, in reparations for the occupation by Germany during World War II. Is there any need for such bitterness? Sure, Greece fudged its accounts to become part of the Eurozone and there was huge corruption in the form of tax evasion, free public transport and a bloated bureaucracy with massive benefits, such as bonuses for washing hands. But Germany is being disingenuous if it shifts all the blame on to Greece. If each country in Europe had its own currency the Deutsche Mark would be the strongest making its products very expensive but, with the euro, 68% of German exports go to other European countries. The euro has fallen from nearly 1.4 dollars in May last year to 1.07 dollars today because the European Central Bank has massively increased liquidity by buying 60 billion euros worth of bonds every month, in an effort to increase lending by banks. A weaker euro boosted German exports by 3.9% in February. Germany has large surpluses and could stimulate the European economy by increasing public spending but it will not. Perhaps a union of European countries is unsustainable. After all Europeans have been fighting each other for millennia.