CFR Update: German Parliament Votes 'Yes' on Greek Bailout Talks

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July 17, 2015 Daily News Brief

TOP OF THE AGENDA German Parliament Votes 'Yes' on Greek Bailout Talks German lawmakers on Friday voted in favor (NYT) of beginning negotiations for a third bailout program for Greece. The vote follows solid support for the bailout in Greece's parliament on Thursday. European Central Bank (ECB) President Mario Draghi backed (FT) Greece's continued place in the eurozone as the ECB raised the ceiling on emergency lending to Greece to $989 million. Greek banks are scheduled to gradually reopen (Deutsche Welle) on Monday, the country’s finance ministry said, after being closed for three weeks. Meanwhile, the International Monetary Fund said on Friday it would participate (WSJ) in the bailout program if it includes debt restructuring.

ANALYSIS "Plenty have called the agreement a coup d'état; Mr Tsipras himself talks of having had a knife to his throat. That conveniently ignores his own culpability in sowing mistrust among the other 18 euro-zone members: his decision to break off negotiations and call a referendum earlier this month squandered any political capital he had left in Brussels. The summit has deepened the tension between sovereignty and stability that bedevils the euro," writes the Economist. "In dealing with Athens's rebellion European leaders faced a tough choice: They could either allow Greece to default, thus putting the common currency at risk, destroying the Greek economy, and sending the message that in a political union of creditors and debtors there is no place for solidarity; or they could save Greece on Mr. Tsipras's terms, thus signaling that political blackmail works and inspiring populist parties all over the Continent," writes Ivan Krastev in the New York Times. "All this is happening while austerity—chosen as the main way to keep the euro strong and the EU competitive—has undermined popular support for the union across Europe, not just in Greece. These developments constitute the dual integration crisis: EU and national. The safest way out of this predicament is an ever closer union, a political Europe with a fiscal union and democratically elected institutions that would redistribute more wealth and would achieve competitiveness through innovation, not austerity and internal devaluation," writes Harris Mylonas in Foreign Affairs.