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A lot has been said about the persona of some of the key figures of the Troika who have “pillaged” our economy and desecrated our sovereignty, but few have had the courage to say that “we had it coming.” It’s been a glorious two weeks of every politician with a chip on his shoulder getting ten minutes of fame on national television, frustrating the public even more with uneducated guesses and vague suggestions. Few have suggested calm.
Naturally, everyone in Cyprus suffers from the after-event syndrome, whereby golden theories are now available in abundance, ranging from returning to the good old pound to some more drastic measures such as selling everything to the Russians and becoming a Mediterranean Gulag.
Fortunately, what seems to have prevailed among sane citizens has been the composed views of a handful of academics and some mature politicians, the latter of whom were obliged on several occasions to raise their voice on air with the hope of drowning the insanity of others or making some narrow minded supporters of the disastrous previous administration shut up.
Unfortunately, not only did we have it coming to us, we didn’t even see it coming when it was smack in our face. IMF delegations had been telling us for years that we needed to reduce our gross public sector deficit otherwise the state would not be able to support the banking sector in the case of default, one of the key parameters of all rating agencies prior to issuing a downgrade. This has been the main problem, while not a single politician has even mentioned downsizing the civil service (and their wages), with the occasional economist saying that we should perhaps keep pay at current levels in order to encourage growth and competitiveness. This means that everyone in Cyprus is hoping that we will strike gold with the natural gas explorations as soon as possible so that the public payroll remains intact and damn the people suffering in the private sector.
Had we dealt with our oversized public sector deficit, we would not have any problem with our “oversized” banking sector, which is not even a fraction of what Luxembourg has, and yet the GermanoFinDutch alliance does not dare mention the Duchy’s financial successes… for now.
On the other hand, had we not rejected the first Eurogroup bailout terms, we would never have heard the Dutch finance minister unveil the dastardly plan to use Cyprus as a template for future bailout of troubled banks and economies, effectively splitting the Eurozone between North and South.
At least now, the general public has Jeroen Dijsselbloem to blame for everything (although he deserves to), which takes some of the heat off Angela Merkel.
