Staus-Khan interview sheds light on Greek debt crisis

Dominique Strauss-Kahn was in a television interview on French national tv and argued for the deletion of the Greek debt. Has anybody outside Greece of France heard about this?  I don’t think so. I tried to find remarks, notes, comments in other networks, news and newspapers but nothing. There were reports all right because this was the first televised interview of the ex- IMF director since his release and return to France after the ‘sex scandal’ in New York. But all the reports on the news were discussing and commenting only the remarks over the sex-scandal. Nothing else. Well in Greece as in France at least the people heard all the story and here I will try to present the story behind the story.

The former director of the IMF  accused the EU of not understanding the magnitude of the crisis. When asked if the euro is at risk Strauss-Kahn said: “No, I do not think the euro is likely to fail or collapse. The situation is very serious  though. Along with the environmental challenge, the financial challenge we face is the most serious for the societies of today and for all ages. If we do not react quickly, in 25 years Europe will be a land which its people are abandoning, a land of high unemployment and impoverished social welfare. We must therefore act now” . Adding to this Dominique Strauss-Kahn said then that it is necessary to understand exactly what happened with the crisis.

“What happened,” he explained, “is that the depth of the 2008 crisis showed that economies that until then we had considered dynamic and dominant, ie U.S., Japan, Europe were no longer so dominant after all. That these economies had suffered gangrene from accumulating huge debts which destabilized further a rotten financial system, that no longer had the monopoly of technology and in addition had aging democracies. ”
When asked if we react today if the plan for Greece can be considered adequate, Dominique Strauss-Kahn said:
“We can react. With particular regard to Greece, we see that the debt is enormous and must at all costs reduce it. At any price except the price of stagnation and recession” he said, acknowledging that the path is very difficult because exactly the European governments’ are reluctant to face the size of the problem. ”

In observation of the journalist if this means you have to delete the Greek debt, Mr. Strauss-Kahn acknowledged that “this is somehow the idea” and explained: “Greece has been impoverished . We can say that the Greeks should pay for themselves, but they cannot. We also say that if we are in a union we would share it. And we must do. It is the fiscal convergence as we had the monetary convergence during the creation of the euro. The question that the governments of the EU stumble upon is if we should accept our losses attributable to achieve convergence. And these losses we will have to accept. ”

According to the former head of IMF involvement in this process will have both states and banks. He stressed that we should recognize the seriousness of the situation instead of pushing for the aftermath of the solutions. “Governments,” he said, “do not solve the problem, they postpone and pushing the resolution of the problem for later and later as if it will disappear. The snowball effect though is growing and developing ever more and i t will be more and more difficult to be resolved.”
“EU leaders all have to face elections back home which definitely hinders their actions. There is however in reality another dimension that they should count. They must accept their losses now, in order to give new fresh start and momentum to the process,” he said. For Dominique Strauss-Kahn is possible to give a new start in Europe on condition that the decisions will come and in their applications there will not be long delays, because the economy moves much faster than politics.
“Think”-he added-“in July 21 there was a summit which had gone well in terms of decisions but  now two months later and nothing is yet in force. Greece did not act well, the Europeans have fail to check properly and European governments have not acted quickly enough to solve problems. ”
“The problem is that European governments do too little or too late, or both together: too little too late,” concluded Mr. Strauss

The interview with Dominique Strauss-Kahn at the television network TF1 broke the record audience for news in France since November 2005, with more than 13 million viewers, announced the Institute Mediametrie.
Between 20:09 to 20:33, when the former head of the IMF responded to questions of journalist Claire Sazal audience share reached 47% – 13,446,000 viewers, according to the institute.


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