The first direction is supported by the “Leftist Platform” of the party (non-aligned communists). They have a quasi-dominant position in the cabinet (council of ministers) of Alexis Tsipras and they continue opposing any negotiation with the creditors (EU/ECB/IMF), regardless of the effects to the Greek economy and to the Greek people. By now, however, they are confused and rather scared because they have brought Greece to the edge of an irreversible catastrophe. All what they want, and to this effect they give the “mother of all battles,” is to establish in Greece a one-party (neo-communist) regime and generate a “crack” in the Eurozone with ultimate purpose the dismemberment of the European Union. Now, all in a sudden, they realize that this is almost impossible and leave the word “almost” in their thoughts, as “hope” is the last to die.
The risk for SYRIZA to take this direction is loosing ground as Greece has a strong middle class, which will resist any such attempt and the first signs are visible in social media. Furthermore Greece is NATO member in a very sensitive geographical area of the Alliance. Thus NATO would never risk seeing Greece giving naval facilities to the Russian fleet in eastern Mediterranean. This implies that such an attempt is impossible to succeed. Therefore it is likely the Leftist Platform of SYRIZA will not insist any more. Indeed, not few intelligent Greeks with basic knowledge of Greek political history understand that this road takes directly to a Special or Martial Court and probably also to a civil war.
Second direction is the compromise. Last night Commission president Jean Claude Juncker sent a last modified draft proposal to Greek government. Today, in the early morning hours was rejected but now is being discussed between the Prime Minister and his associates. This proposal gives to SYRIZA a decent way-out and technical details have no importance as the issue is only political.
It should be noted that when the capital controls begun last Sunday the banks closed for 8 days and withdrawals in the ATMs were limited to sixty Euros per day. Monday, curiously enough, ATMs run short of twenty Euro bills thus allowing only the withdrawal of one banknote of fifty Euros per day. Today, the Central Bank said that the maximum withdrawal is 120 Euros per week.
The latest proposal of the Commission, however, has a very sensitive point, which may prove the obstacle for getting an agreement immediately. The basic element of the Juncker proposal is that the Sunday (July 5) referendum must give YES by majority, with the support of the government (which until now is preaching for NO). The three institutions unanimously said that YES means Greece remains in the EU and the Euro while NO means Grexit. To this effect, the Greek government which obviously wants to compromise because by midnight may lose everything, in a desperate effort might cancel the referendum without consultations, in order to keep the door open for a future attempt.
At this moment the creditors, insist on the referendum with a clear YES result and there we are.
Basil A. Coronakis is New Europe Editor. (coronakis(at)neweurope.eu)