Although not in Davos for the latest round of Greece related fireworks, mostly involving German and Commission officials, this writer has been parsing the statements and reporting on Greek PM Alexei Tsipras’ contacts there with American officialdom. Knowing what Mr. Tsipras needs back home, our primary concern is finding any sign that the Greek side picked up American support that could be turned into useful negotiating leverage against Greece’s European partners or the IMF. Washington generally doesn’t jump into meetings that its allies will use against other U.S. allies.
Beyond the photo-ops which were instantly tweeted by Tsipras’ media drones, nothing obviously useful against Europe emerged from the public statements following PM Tsipras’ Davos encounters with U.S. Vice President Joe Biden or Treasury Secretary Jack Lew. Standard stuff, more or less. It would be great to learn who actually requested these meetings; our bet is the Greek side did it simply because the photo-ops and sound bites have much more value to Athens. The U.S. press practically ignored these short meetings focusing on key global concerns at Davos instead.
Biden-Tsipras Meeting January 20: Two caretakers having a chat?
Try and decipher this cryptic White House phraseology: “Vice President Biden met today with Prime Minister of Greece Alexis Tsipras. The leaders agreed on the importance of moving forward as quickly as possible on Greece’s economic reforms, including serious discussions with creditors on debt relief.” Although this writer has drafted Delphic press statements in this format before, it is unclear how economic reforms translate into debt relief discussions beyond the known and agreed sequence – Greece fully completes the agreed structural reforms, passes the review by The Institutions/Troika, and then the creditors look at debt relief, with the up-front debt write-down not one of the options. We understand all the Greek side really cared about was a mention from Washington of the term “debt relief,” even though the U.S. does not hold any of the debt Greece is actually worried about. One day the WH might tell us what they think the difference is between “serious discussions” and normal discussions on debt relief in the European framework.
The rest of the WH statement is more straightforward: “The Vice President commended the Prime Minister for the constructive approach his government has taken on the Cyprus issue, along with his leadership on energy infrastructure projects that boost European energy security. Both leaders stressed the importance of security cooperation and continuing to move forward on a whole-of-Europe solution to the migration crisis.” This is just a listing of the other perennial geopolitical talking points that would be used in any high-level meeting.
The messaging from the Tsipras team in Davos played things a little differently. Issuing a full page report on the meeting, they described in much more detail all the topics somebody referenced: The Greek economic program, American investor interest, energy, Cyprus, the refugee crisis and the FYROM name issue, leaving out VP Biden’s call for completing Greek structural reforms. Surprised?
Treasury Secretary Lew and the IMF connection
Treasury Secretary Jack Lew made time to meet PM Tsipras the following day, January 21. The men have had several telephone contacts, mostly during the crisis months last spring-summer. Treasury has not yet released its version of the meeting, but the Greek side again instantly reported that discussions were on debt relief, Greek recovery prospects and reforms and PM Tsipras posted a picture of the men shaking hands on Twitter. The shifting but positive U.S. role in catalyzing the IMF to press Europe for more Greek debt relief could fill a small book, if the relevant documents are ever released. Secretary Lew will probably be close to the center of this, at least in last summer’s critical days for Athens.
Lagarde stays on; Greece stays in?
This is the 25 billion Euro question; at this point none of us know whether the Greece issue played a role in the apparent decision in key capitals to allow Christine Lagarde to continue on at the IMF for a second term. Based on the accolades heard in Davos from representatives from both sides of the Atlantic (Biden, Cameron), it does appear the final decision on her tenure was recently made by many of the key parties. Time will tell if the Greek debt relief package was a factor. It doesn’t appear that a head-on collision with Berlin over Greece would have helped to secure her tenure.