Austerity has won. The demands of the Troika upon which Syriza caved in to – or as some commentators have alluded acquiesced – are intended as a warning to the rest of Europe that a left-wing government anywhere will not be tolerated.

Non-capitulation by Tsipras would have effectively been construed as something akin to the threat of a good example being set to the rest of the nations that comprise PIGS. Thus, this outcome would have been regarded by the banking clique that dominate the Troika as totally unacceptable.

What has happened in Greece is a lesson for the rest of us. I am in absolutely no doubt at all that European democracy is in the process of being usurped by an unelected elite at the top of society. Teachers and other public sector workers who previously might of been reluctant to take to the streets of Athens, will soon be scouring the bins for food along with the unemployed. Riots and looting will follow in due course, of that, I’m certain.

Lucid and concise analysis of the issues that led to yesterdays “negotiated” settlement resulting in yet more Greek bailouts in return for yet more austerity, has been hard to come by in the mainstream media. The exception was the analysis by professor Mariana Mazzucato on the UKs Channel 4 News (July 12).

“In financial terms, where is the capital of Greece tonight?”, inquired anchor, Jon Snow.

“Is it in Athens, is it in Brussels, or is it in Berlin?”, he continued.

“In some ways it’s in the banks”, retorted a smiling but incredulous Mazzucato.

The professor continued:

“I think we forget sometimes that only 10% of the bailouts went to the Greek economy. The rest went to the banks who were bad lenders and they are not paying any price. After WW2 not only was 60% of Germany’s debt forgiven but also we had the Marshall Plan which provided an investment package. With Greece we are just postponing the crisis until the next bailout.”

Mazzucato then went on to outline some of the myths perpetuated by the bankers and offer some sensible remedies:

“Privatization is not accompanied by employment and investment. What we need is a coherent package that allows Greek businesses to compete with German businesses as opposed to destroying them” continued the professor. “We have to learn from Keynes”, she said.

“There was a problem of aggregate demand in Germany after the Schroeder reforms when there had been a massive wage restraint. There was excess cash in the German banks. These banks lent to the Greek banks which lent to Greek businesses who then bought from German companies, So this was part of Germany’s export strategy.”

Placing the emphasis for the crisis squarely on the shoulders of the bankers, and outlining further alternatives to the established media narrative, Mazzucato went on to say:

“The same problem of aggregate demand is happening in Greece where we are not allowing various types of workers to benefit from investment packages.This will not only increase the number of jobs but the quality of jobs. The Syriza government was running a surplus. There were already massive reforms in place but the Greek government were not given time to implement them. As a government they are far from perfect, but the idea that they were governing badly is a mischaracterisation of what has been happening.”.

http://www.channel4.com/news/greece-deal-tsipras-eurozone-bailout-merkel-hollande