Time banks, farmer-to-buyer sales groups and alternative currencies springing up but expansion has not been steady or easyAs money has become tighter in Greece, an alternative “solidarity economy” has sprung up providing everything from food and medical care to hairdressing and language classes to thousands – without a euro changing hands.The Athens Time Bank, for example, allows members to collect credits by offering an hour of their time to someone who needs their services. The bank boasts doctors, dentists, electricians, yoga teachers and plumbers among its ranks, but the most popular service on offer is psychotherapy – highlighting how years of austerity have eaten away at more than just savings and living standards.Related: Euros discarded as impoverished Greeks resort to bartering Continue reading...

Christine Lagarde’s comments echoed earlier concerns that proposals will fail unless measures go far beyond what the eurozone has offered so far

Sterling hit high of more than seven years after Bank of England governor Mark Carney indicated that period of 0.5% borrowing costs will end within monthsThe pound has hit a seven-and-a-half year high against the euro after Mark Carney signalled that the first rise in interest rates since the global financial crash could take place around the turn of the year.

Mark Carney says first increase since height of financial crisis is becoming increasingly necessary as economic growth strengthensBritain has been put on alert to expect its first interest rate rise since the global financial crash at around the turn of the year as the governor of the Bank of England, Mark Carney, warned that the long period of 0.5% borrowing costs was coming to an end.Carney told businesses and consumers that Threadneedle Street would have to respond to the economy’s stronger growth by announcing the first tightening of policy since rates were increased to 5.75% in July 2007 – the month before the US subprime mortgage crisis erupted.Related: Buy-to-let boom could jeopardise financial stability, says Bank of England Continue reading...

Mark Carney, the governor of the Bank of England, says the UK can expect its first rise in interest rates since the financial crash. Speaking at Threadneedle Street, Carney says the period of 0.5% borrowing costs is due to come to an end. The warning reflects the Bank's concerns about high debt levels in the UK Continue reading...

Rancorous Bundestag debate expected as dissenting members of chancellor’s centre-right coalition and leftwingers threaten to derail bailout for AthensAbout 50 German MPs from Angela Merkel’s ruling alliance are expected to revolt against the government and vote no to a third Greek bailout in the Bundestag on Friday.

Greece may have voted to authorise the deal but it also needs to be approved by other eurozone parliaments before any funds are releasedThe Greek parliament voted late on Wednesday evening to undertake the package of reforms needed to begin negotiations for an €86bn bailout programme. Despite 32 of its MPs voting against the plans, the Syriza-led government won out by 229 votes to 64.Greece is of course not the only parliament in the eurozone that will need to agree to a third bailout deal. Even in those countries that will not require a formal vote, tensions may emerge further down the road within governments that have small majorities.Greece's Creditors NOT just banks. Exposure of € zone countries poorer than Greece stand to lose up to 4.2% GDP http://t.co/i4QZ3w1xBsSoini: This was not a good day, there were no good option, we had to choose between plague and cholera. #GreeceBarclays: Official exposure to Greece in EMU by country and type pic.twitter.com/5QKkrsWr77The Greek compromise, reached on Monday, is considered to be tough and harsh. If it's so, it is the unfortunate outcome of ´Syriza Spring' Continue reading...

Estate agents could face a drop in the confidence that is keeping house prices high, as an increase in base rate will drive up mortgage costsHomebuyers can wave goodbye to mortgages at just 0.99%. Savers can say hello to better rates for the first time in seven years. Investors will wobble as bond funds dive. But it is estate agents who have most to fear.Related: Interest rate rise set for new year, warns Bank of England governor Continue reading...

As fears grow over bank closures, capital controls and a potential euro exit, Greek people are buying luxury goods to put their money in something tangible

Owen Jones, George Monbiot and other usually thoughtful commentators on the left are making a fundamental error when they advocate a “Lexit” campaign to promote UK withdrawal from the EU (The left must now campaign for Britain to leave the EU, 15 July). It would be a classic case of jumping from the frying pan into the fire. Do they really believe that working people throughout Europe would do better left to the mercies of financial and commercial interests, whose control over individual governments would be enormously increased by being able to divide and rule. The idea that there could be a Europe of free trade without elected democratic oversight would mean abandoning any hope of social justice and would be likely to bring about a competitive undermining of workplace rights and benefits.Owen Jones is surely right in thinking that if Labour really wants a revival it must come out and support BrexitThe EU now is beyond redemption. The mask is off, as John Hilary of War on Want put it at an anti-TTIP meeting this weekEven the Syriza government supports continuing membership of the euro and the EU Continue reading...

The European Central Bank has provided more liquidity to Greece’s banking sector, after the Athens parliament approves bailout deal

Read the full text of the Guardian’s exclusive interview with philosopher and sociologist Habermas, in which he describes the agreement as ‘toxic’Guardian: What is your verdict on the deal reached on Monday?Habermas: The Greek debt deal announced on Monday morning is damaging both in its result and the way in which it was reached. First, the outcome of the talks is ill-advised. Even if one were to consider the strangulating terms of the deal the right course of action, one cannot expect these reforms to be enacted by a government which by its own admission does not believe in the terms of the agreement.The European Council is effectively declaring itself politically bankruptRelated: Greece’s rescue package: utter humiliation or disaster averted? | The panelRelated: Merkel 'gambling away' Germany's reputation over Greece, says Habermas Continue reading...

Mario Draghi reveals extra €900m in emergency funding and adds backing for debt writeoffs as hopes rise that Greek banks will reopen on MondayBanks in Greece could open their doors on Monday for the first time in three weeks, after the European Central Bank boosted emergency funding for the country’s financial sector by €900m (£630m) and threw its weight behind calls for debt relief for Athens.The ECB president, Mario Draghi, announced the extension of aid to the country’s banks while backing the idea – championed by the International Monetary Fund but rejected by Germany – that some of Greece’s debts will have to be written off.Related: Greek debt crisis: ECB raises emergency liquidity and pushes for debt relief - live updatesRelated: George Osborne backs down on use of EU bailout fund in Greece crisisRelated: Merkel 'gambling away' Germany's reputation over Greece, says HabermasRelated: British progressives and the European Union: should we stay or should we go? | Letters Continue reading...

Relative price of McDonald’s staple meal is 43% less in China than in US, according to The Economist’s fabled burgernomics measureChina’s currency is significantly undervalued against the dollar, according to the Economist’s latest Big Mac index, which found that the bestselling burger from McDonald’s cost 43% more to buy in the US than in the world’s second largest economy.The yawning gap between the Chinese yuan and the US dollar, documented in the latest index, indicates that another round in the Sino-US currency war could be looming, although experts cautioned against taking the index as a stringent measurement of currency strength. Continue reading...

In a compromise, chancellor reassures taxpayers there will be an ‘impregnable ringfence’ around the up to £850m of British-backed funds in the EFSMGeorge Osborne has backed down over the use of an EU bailout fund to give an emergency loan to Greece. But the chancellor said there would be an “impregnable ringfence” around the up to £850m of British money in the fund to prevent any losses to the taxpayer in the event of any default.The chancellor argued it was a major victory for Britain in the EU because he had made it a “red line” that UK funds would not be threatened. But Eurosceptics will paint it as an example of Brussels reneging on an agreement with the UK, as David Cameron thought he had secured an opt-out from the EU-wide bailout fund being used after it was set up to help Ireland and Portugal in 2010.Related: British progressives and the European Union: should we stay or should we go? | Letters Continue reading...

The Greek prime minister, Alexis Tsipras, isn’t to blame for his party’s disintegration. Its roots lie in the party’s absence of coherent objectivesAlexis Tsipras survived last night’s vote in the Greek parliament, but not without witnessing the disintegration of his own party. Three ministers and 39 Syriza MPs refused to support the new memorandum of understanding voted in last night. The deal was passed with opposition votes. Technically Syriza still has a mandate, but in reality it will be unable to govern without these opposition votes.Among those who split away are renegade MPs from other parties that Syriza integrated before the last election to attract voters. The core rebels, though, come from the party’s hardline Left Platform. They include the ministers Panagiotis Lafazanis and Dimitris Stratoulis, who despite not voting for the deal refuse to leave office. A standoff also occurred with the speaker of parliament and the Syriza MP Zoe Konstantopoulou. Disliked by many for her outspoken manner, Konstantopoulou voted against her own party last night. Syriza now faces a split that is not only about the deal but also about who will shape the future of the party.Related: Greek MPs pass austerity bill as Athens police clash with protestersThe absence of a clearly defined strategy initially helped to boost the numbers of party supporters Continue reading...

This attempt to turn Athens into a debt colony will fail – and open the way to the breakup of the eurozoneYou couldn’t have had a clearer demonstration of what democracy now counts for in Europe than this week’s immolation of Greece. In January, after five years of grinding austerity imposed by the troika of creditors had shrunk its economy by a quarter and pushed millions into poverty, Greeks rebelled and elected an anti-austerity government.Following months of fruitless negotiations, the country voted last week to reject the latest cuts, tax rises and privatisations demanded to deal with the disastrous impact of the first phase of austerity. The response of the eurozone’s masters was immediately to ratchet up the pain still further. For the “breach of trust” of daring to put the terms to its people, Athens was to be punished. So on Monday – threatened with expulsion from the eurozone and economic collapse courtesy of the European Central Bank’s cash blockade – the Greek prime minister, Alexis Tsipras, bent the knee.Related: The left must now campaign to leave the EU | Owen JonesWhat kind of a union treats one of its members like a recalcitrant colony and dismisses its democracy as an affront? Continue reading...

Funding comes as eurozone finance ministers scramble to assemble €7bn bridging finance to keep economy afloatGreek banks will benefit from an extra €900m (£630m) in emergency funding to keep them afloat, the European Central Bank has announced, possibly allowing bank branches to open on Monday.Mario Draghi, the ECB president, said a majority of the central bank’s governing council had voted in favour of the move that brings the institution’s support for Greek banks to €130bn in total. Continue reading...

Cutting tax credits and raising the minimum wage puts the onus of income on having a job - jobs which are increasingly at riskMost rich countries now have millions of “working poor” – people whose jobs do not pay enough to keep them above the poverty line, and whose wages therefore have to be subsidised by the state. These subsidies take the form of tax credits.The idea is a very old one. England implemented its “Speenhamland” system – a form of outdoor relief intended to offset rising bread prices – during the Napoleonic Wars. In 1795, the authorities of Speenhamland, a village in Berkshire, authorised a means-tested sliding scale of wage supplements. The supplements that families received varied with the number of children and the price of bread. Continue reading...

Exclusive: Intellectual figurehead of European integration says efforts of previous generations put at risk by Angela Merkel’s hardline stance on GreeceJürgen Habermas, one of the intellectual figureheads of European integration, has launched a withering attack on the German chancellor, Angela Merkel, accusing her of “gambling away” the efforts of previous generations to rebuild the country’s postwar reputation with her hardline stance on Greece.Speaking about the bailout deal for the first time since it was presented on Monday, the philosopher and sociologist said the German chancellor had effectively carried out “an act of punishment” against the leftwing government of Alexis Tsipras.Related: Eurozone scrambles to assemble €7bn bridging finance to keep Greece afloatRelated: Protests against austerity in Athens and Berlin - in pictures Continue reading...

Prime minister plans to provide skills training to more than 400 million people to tackle workforce shortagesIndia’s prime minister, Narendra Modi, launched a programme on Wednesday aimed at imparting skill training to more than 400 million Indians over the next seven years “to make India the world’s human resource capital”.

Alexis Tsipras drives through tax increases and pensions shakeup amid angry splits in his Syriza party

The treasurer, Joe Hockey, outlines his plans for Australian tax reform at a PricewaterhouseCoopers lunch in Melbourne on Wednesday. He says superannuation tax must not take money from those who have worked hard to take care of themselves, and that state, corporate and income tax reform is needed to boost Australia's economic competitiveness Continue reading...

Divisions emerge within Angela Merkel’s CDU party over whether to back deal as demonstrations take place in 14 cities over austerity package imposed on GreeceProtesters have taken to the streets in 14 German cities to show their anger with their government’s handling of the Greek crisis, as opposition to the bailout deal appeared to be growing within Angela Merkel’s Christian Democrat (CDU) party.Anti-austerity demonstrations by a vocal minority of Germans took place in cities including Berlin, Frankfurt and Hamburg, with the radical left in the EU’s economic powerhouse proclaiming its solidarity with those across the world who are furious with Berlin for its role in forming Monday’s agreement.Related: Greek bailout: Angela Merkel accused of blackmailing AthensRelated: Greek crisis: Protests in Athens turn violent as Tsipras urges MPs to back him - live updatesRelated: Measured, sober and sceptical: Germany reacts to Greece deal Continue reading...

Riot police have clashed with anarchist groups in Athens tonight, as Greece’s PM Tsipras faces rebellion over the country’s bailout plan

Embattled prime minister fights to outflank opposition to eurozone agreement as riot police use teargas on demonstrators outside Athens parliamentAlexis Tsipras is fighting for his political life as he seeks parliamentary backing for the severe austerity measures Greece has pledged to take in exchange for a fresh bailout from its eurozone partners.The Greek prime minister urged his Syriza colleagues to support him in the make-or-break vote on Wednesday night, even as the International Monetary Fund – and his own former finance minister and right-hand man Yanis Varoufakis – savaged the deal struck in the early hours of Monday morning.Related: Eurozone bailout deal: what do ordinary Greeks think? Continue reading...

Disaster may narrowly have been averted for the eurozone, at the expense of Greece’s political autonomy. But it won’t take much for it all to crash downThe last act of the classical Greek tragedy ends with two outcomes: disaster and catharsis. In the current Greek debt drama, however, there has been no catharsis. The purification has failed to materialise.It would have meant that both sides had seen the error of their ways and come to their senses. Instead, the madness continues: Greece will take on €86bn of debt in addition to the existing €317bn (not including the emergency loans from the ECB). From Angela Merkel through François Hollande to Alexis Tsipras, all eurozone government leaders assert that Greece will emerge from over-indebtedness more quickly this way and will be economically healed in three years. Europe pretends that the bailout will help. And Greece acts as if everything is fine now.The troika is not operating as a trustee, but representing highly selfish interestsRelated: The euro ‘family’ has shown it is capable of real cruelty | Suzanne Moore Continue reading...

In the city where the party unveiled its manifesto, many of the grassroots feel betrayed by the bailout and blame Greece’s leader for not calling the troika’s bluffIn Thessaloniki this week, some Syriza activists have found brief relief in a bit of gallows humour. You can buy many kinds of local pastries, or bougatsa, in the city – bougatsa with cheese, cream, or mince meat. “Soon we’ll be having bougatsa with memorandum,” smiled Syriza activist Tassos Gkouvas, as he drank coffee on Wednesday with Athina Teskou, a member of the local party’s governing committee.

Money from an EU bailout fund would enable Athens to meet debt obligations and other expenses of the government such as wagesThe European commission has proposed a €7bn (£4.9bn) emergency loan for Greece from an EU bailout fund, defying the UK and other non-eurozone countries that object being on the hook for a crisis in the currency union.

Federal Reserve chair Janet Yellen says the increase will happen ‘if the economy evolves as we expect’, while both the euro and oil prices fellUS stock prices held steady on Wednesday as the Federal Reserve chair, Janet Yellen, again suggested there would be an interest rate increase by the end of the year, while the euro fell ahead of a Greek government vote on whether to accept tough terms for a vital third bailout.Oil prices fell on worries of growing supply from Iran following a landmark deal that would lift sanctions that have curbed its oil sales for several years.

My research found that the myth of billionaires boosting the economy is untrue – particularly when they amassed their wealth from political connectionsAfter I escaped communist Czechoslovakia in 1970, I enrolled at Cornell University. In my introductory sociology course there, I was taught that becoming a billionaire was impossible – realising the “American dream”, at least at the very top of the income scale, was effectively no longer an option. The last few decades have certainly proved this thesis wrong.This shift has had significant consequences for income and wealth inequality not just in the US, but also in many countries around the globe. In fact, the top 1% globally will soon hold over half the world’s wealth. And their share is growing. This stunning fact makes it all the more important to ask what this means for the rest of us. Given the amazing level of accumulation of wealth at the top, improving our understanding of the economic role of billionaires has certainly become a public policy issue of the highest order.We discovered that billionaire wealth arising from being politically connected has a strongly negative effect on growthRelated: Britain has world's most billionaires per capita Continue reading...

Prime minister Alexis Tsipras, who has lost a key minister unwilling to support measures, must keep number of rebels to fewer than 40 to pass voteAlexis Tsipras, the Greek prime minister, is preparing for a make-or-break parliamentary vote over the austerity measures Athens must take in exchange for a fresh bailout from its eurozone partners.

Plan is a blow to British PM David Cameron who thought he had secured a ‘black and white’ opt-out from further bailouts for eurozone countriesThe European commission has defied George Osborne, the UK chancellor, by formally proposing an emergency loan for Greece through an EU-wide bailout fund using up to £850m of British contributions.

In a short, sharp and merciless analysis of the bailout terms for Athens, the International Monetary Fund predicts we will all be back here again soonThe timing was impeccable. A day after Greece and the eurozone concluded bailout negotiations, but 24 hours before the hugely contentious deal had been voted on in Athens, the International Monetary Fund dropped a bombshell: the agreement won’t work.In four crisp pages, the IMF’s updated debt sustainability analysis ripped to shreds the notion that Greece will be able to deliver on the promises it has been forced to make in order to keep its banks open and stay in the single currency. Continue reading...

The International Monetary Fund’s devastating critique of the terms facing Athens Continue reading...

Latest data shows wages increase by more than 3% but jobless rise causes concern that employers have to shell out more due to dearth of skillsBritain enjoyed a bumper pay rise in spring, with average earnings 3.2% higher in the period from March to May 2015 than a year earlier, highlighting the increasing skills shortages forcing employers to offer higher wages.But the better earnings figures, from the Office for National Statistics, came as unemployment rose for the first time in two years, sparking fears that Britain’s booming labour market has lost some of its momentum. Continue reading...

A brutal assessment of the bailout terms facing Athens by the International Monetary Fund calls for substantial debt relief for a further 30 yearsJust hours before the Greek parliament’s crucial vote to push through fresh austerity measures required by the new bailout plan, the International Monetary Fund released a devastating assessment of the beleagured nation’s finances.Warning that Greece will require far more generous debt relief than is currently on offer from its creditors, it predicted that public debt is likely to peak at 200% of its national income within the next two years.Related: Greek crisis: MPs debate bailout after IMF demands debt relief - live updatesRelated: Why the IMF should not aid a Greek bailoutRelated: Alexis Tsipras: bailout a ‘bad deal’ but the best Greece could get Continue reading...

As well as data, economic deals ultimately depend on the amorphous yet essential qualities of integrity, trustworthiness, and interpersonal chemistryToday’s decision-makers are supposed to embrace the virtues of big data, relentlessly pursue quantitative metrics, and then adhere to the optimal course of action that these powerful tools supposedly indicate. Yet if there is one thing that the Greek crisis has made clear, it is the importance of the human factor in negotiations. People and their personalities, and the way they perceive one another, can make small debts seem unserviceable or large debts disappear with a handshake.

Business secretary Sajid Javid to criminalise unlawful picketing, and make it harder for workers to strike legally and for Labour to get union fundingThe biggest crackdown on trade union rights for 30 years will be unveiled on Wednesday, including new plans to criminalise picketing, permit employers to hire strike-breaking agency staff and choke off the flow of union funds to the Labour party.It is clear the Tory ​​party ​high ​command intend to make Labour bankrupt by cutting off the main source of fundingRelated: Frances O’Grady: ‘My members are the wealth creators, but don’t get a fair share’ Continue reading...

Relief for squeezed households tempered by concerns that stronger pay growth could have knock-on effects for inflation and warrant an interest rate riseOfficial figures are expected to confirm that wage growth continues to pick up in the UK and has hit a five-year high, bringing relief to households after years of squeezed living standards.Economists polled by Reuters have pencilled in a 3.3% annual rise in average pay packets during the three months to May. At the same time, they expect unemployment to be held at a seven-year low of 5.5%. Continue reading...

All week this series looks at the questions Labour will need to answer if it is to win the next election. Today, what is the best size and shape of the state for the 21st century?The Hungarian mathematician George Polya had a rule for dealing with anything that looks intractable: “If you can’t solve a problem, then there is an easier problem you can solve: find it.” This applies in politics too. One of the hardest problems Labour faces is how to rebuild a reputation for economic competence when the Conservatives have successfully painted the opposition as unrepentant budget wastrels. To concede the point feels like surrender on enemy terms: accepting a mendacious account of what caused the financial crisis; signing up to cruel cuts. Yet to dispute the point looks like denial of political reality – blaming the voters instead of listening to them.So, following Polya’s maxim, how does Labour find a solvable problem within the unsolvable one? The trick is to take the Tories (momentarily) out of the equation. Posit super-benign circumstances in which there is no blame for the great crash and even George Osborne says all fiscal paths are equally valid. In this fantasy land the left would still have to confront failings of the Labour state that cannot simply be cast as inadequate funding or corruption by private enterprise.There is a vast political space between monolithic state control and a privatised market free-for-allRelated: Who should Labour speak for now? | John HarrisRelated: Britain won’t recover while its economy is dominated by magical thinking | Aditya Chakrabortty Continue reading...

Prime minister tells Greek TV he will not resign and defends his abrupt change of course over debt crisis

Greek prime minister tells state television that Sunday’s bailout deal was a bad night for Europe, but he won’t walk away.Read today’s Greek news live blog11.59pm BSTWe’ve now got hold of the new IMF report into Greece’s debt sustainability.And a quick perusal shows that the Fund has comprehensively obliterated the notion that this third Greek bailout will work, as it stands.Greece’s public debt has become highly unsustainable. This is due to the easing of policies during the last year, with the recent deterioration in the domestic macroeconomic and financial environment because of the closure of the banking system adding significantly to the adverse dynamics.The financing need through end-2018 is now estimated at €85bn and debt is expected to peak at close to 200 percent of GDP in the next two years, provided that there is an early agreement on a program. Greece’s debt can now only be made sustainable through debt relief measures that go far beyond what Europe has been willing to consider so far.The events of the past two weeks—the closure of banks and imposition of capital controls—are extracting a heavy toll on the banking system and the economy, leading to a further significant deterioration in debt sustainability relative to what was projected in our recently published DSA.Medium-term primary surplus target: Greece is expected to maintain primary surpluses for the next several decades of 3.5 percent of GDP. Few countries have managed to do so. The reversal of key public sector reforms already in place— notably pension and civil service reforms—without yet any specification of alternative reforms raises concerns about Greece’s ability to reach this target11.41pm BSTThis is important. IMF says Greece needs 30yr grace period on its debt. Even bigger debt relief https://t.co/JRbGA8Wyn711.19pm BSTIMF won't take new #Greece programme to board unless there is a solution to debt problem11.19pm BSTTHIS IS IT. The IMF stating as bluntly as it can that Europe must decide between giving Greece a 30-year grace period to repay its debt, and accepting the reality that serious haircuts must be taken:IMF: Greece debt "highly unsustainable" - needs up front haircut or dramatic maturities extension and grace period pic.twitter.com/0YuWG2Va7j11.12pm BSTSome late breaking news: The International Monetary Fund has confirmed today’s leaked report which warned that Greece needs much more debt relief than the eurozone has accepted:Here’s the details;IMF on Greece: €85bn may not be enough due to optimistic surplus and growth targets: pic.twitter.com/6pEmtovW4710.43pm BSTHeads-up: the process of driving Greece’s bailout deal through parliament will start early:#Greece | Prior actions draft bill to be introduced to parliamentary committees and plenary tomorrow 0700 GMT.10.04pm BSTEven if you think Alexis Tsipras has misplayed the crisis, it’s hard not to be impressed by his composure in tonight’s interview.“Last night was a bad night for Europe.”“To be frank, here, they [eurozone countries] are not only forced to give fresh money, but to give 82 billion, and are accepting the restructure of debt.”“I am fully assuming my responsibilities, for mistakes and for oversights, and for the responsibility of signing a text that I do not believe in, but that I am obliged to implement,”“The hard truth is this one-way street for Greece was imposed on us,”That #Tsipras spoke of #Greece suffering post-traumatic stress at moment says all you need to know about what kind of w/e he had #Greece“The worst thing a captain could do while he is steering a ship during a storm, as difficult as it is, would be to abandon the helm.”So, hats off to @tsipras_eu at last?#Tsipras overarching theme: #Greece backed into corner. Doesn't believe in agreement. Bad night for Europe. But signed "to avoid disaster"9.20pm BSTWhat about the big question ahead of tomorrow night’s vote on the bailout -- might you resign?Tsipras says that “A captain cannot abandon ship” during a storm.

Fund’s leaked debt sustainability report shows that Greece’s public debt is likely to peak at 200% of national income within the next two years

Even if the country implements market reforms, VAT increases and pension cuts, its debt will still be too big to service, so why should the IMF contribute to a loan?

The Greek bailout saga reminds me of a story from antiquity about discussions (or, euphemistically, negotiations) between representatives of a powerful state, aiming to secure its empire and deter subjugated member-states from future rebellion, and a pesky weaker state, which is offered the choice between total destruction and the acceptance of the stronger state’s demands, viz payment of tribute and loss of sovereignty. The weaker state’s representatives invoke quaint notions such as justice and freedom in their arguments against personal and financial enslavement, but this is met with a lecture on the harsh truths of realpolitik (as we might call it): that questions of justice are only relevant “between those with an equal power to enforce it”, and that the sole question of relevance is “one of self-preservation – that is, not resisting those who are far stronger than you”. In the hope that they might somehow preserve their independence, the weaker state declines the offer then on the table, that of enslavement, only to be faced with no choice at all: their adult males are killed, their women and children enslaved, and their land and property expropriated.Such was the story told by Thucydides of the treatment of Melos by the imperial state of Athens in 416-15BC. While any parallels with current events must be drawn with caution (who could imagine that a modern European nation would impose collective punishment on its weaker brethren?), it is perhaps worth mentioning as a footnote that the Athenian empire was only to survive its destruction of Melos for little over a decade.

Bank of England governor spoke to MPs about the Greek crisis in a drawl that was so laid-back as to be threatening, while his colleague failed at simple mathsUrbane, tanned, decked out in accessories as featured in this month’s GQ and smooth. Very smooth. Mark Carney is the Milk Tray man de nos jours. While other European bankers have been getting into a sweat over Greece, the governor of the Bank of England gives the impression of a man who has just been on holiday there. Not even an imminent eurozone crisis could shift him from chilling on his sun lounger. Carney is a man who never worries about missing a pedalo, because there’s always another one coming along soon.So when Milk Tray man told the first meeting of this parliament’s Treasury select committee that “eyes would have to be kept open on this”, everyone knew the latest Greek bailout deal would almost certainly end in disaster. To prove his point, Carney raised his hooded eyelids a millimetre. “There are big execution risks,” he said in a Canadian drawl that was so laid-back as to be threatening. Greece might as well hand over the keys of the Parthenon to Germany right now.Related: Back to zero inflation: falling food and clothing prices drag rate back to 0% Continue reading...

UK chancellor says Britain paying towards bailout help is ‘non-starter’ but European commission considers idea of loan that would include £850m from UK