Life in the age of Schaeuble

Posted by Antonis D. Papagiannidis 23/01/2017 0 Comment(s) Economia Blog,

The towering presence of "Dark Knight" Wolfgang Schaeuble , whose steady hand on the helm of the German Finanzministerium but also within the Eurogroup , is not something one fools with. Still, the pressure of the German electoral campaign coming after so many years of seeming omnipotence seems to have crushed his legendary self-assurance and  deflected his unwavering course.

 

Within one week, Schaeuble managed to shift positions over the issue of the ill-fated Greek Adjustment Programme (the third in a row) three or four times. First he went on record saying that were the IMF not to join the current Greek Programme, then the Greek salvage operation could be assumed by the ESM along with the EU institutions.

 

Then he shifted course, or rather he corrected his initial position preaching - or rather, stating the evident - that any new Programme would have to be negotiated by Greece with its European creditors, concluded and then ratified by participating countries, in many cases at Parliament (that is, for him, the Bundestag). 

 

Two days down the road he shifted a little more: well, the Bundestag wouldn't just have to ratify such a new agreement - it would have to vote beforehand, to give a mandate for negotiations to get started.

 

The last stage came at Davos, after both the tabloid Bild an the respected financial Handelsblatt ran stories stating that the Finanzministerium was already preparing such a Plan B for Greece (both stories were summarily given the lie-officially). There, Schaeuble said that were the IMF to quit the Greek Programme (or not join in) no new Programme would be forthcoming. With some 6.3bn of Greek paper coming due in mid-July, this would mean the plug would be pulled by then on the errant country (errant to Schauble's liking, of course). Then again at the self-same Davos setting a Schaeuble/Lagarde meeting ended with Lagarde re-iterating the und's intention to remain with the Greek Programme.

 

Not so easy a situation, indeed. Remains to be seen whether the Dark Knight wields all the power he's making a show of. Athens looks mildly shocked.

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