Greek debt crisis: PM resigns amidst 3rd bailout

By Alejandro Freixes, CCNN Head Writer

Greece
The Greek flag (background), Greece’s location in Europe, and the Parthenon (bottom right). The Parthenon was an ancient temple to the Greek goddess of wisdom, Athena, who the capital of Athens was named after.

European Union (EU) leaders narrowly reached a deal this summer with Greece to save the debt-ridden country from total financial ruin, with a third bailout. In return, Greece agreed to make major reforms, to slow the downward spiral that has ballooned the country’s debt to over 300 billion euros.

Now, prime minister Alexis Tsipras is resigning early, in a bid to get re-elected quickly and shake off the rebels in his own party.

Back in January, Greeks elected underdog Alexis Tsipras as prime minister, when his Syriza party won 149 seats in the 300-seat lawmaking parliament.

At first, he began clashing with EU leaders and banks over his country’s debt, trying to wriggle out of payback deals that helped save his poverty-stricken country. See, during the global 2008 financial crisis, Greece was hit particularly hard. So, they borrowed heavily from European banks and promised to cut government spending, as part of “austerity” measures. Austerity (which basically means “severe simplicity”) is the act of spending as little money as possible.

Greek citizens protested against austerity, which they felt was punishing them rather than the banks that contributed to the 2008 meltdown. Since Tsipras is anti-austerity, leaders like German Chancellor Angela Merkel and French President Francois Hollande are concerned that Greece won’t honor its debt agreements. Germany has been a very tough negotiator during bailout talks, because they’ve given Greece a substantial amount of money. Tsipras had no choice but to accept the harsh terms of a third bailout, angering extremists within his own party who rebelled against him.

Greece, with its population of 11 million, traces its roots all the way to Ancient Greece over 2,000 years ago. It was considered such an advanced civilization back then, that many historians view it as the birthplace of modern civilization. That’s because Ancient Greece influenced the rest of the world with its democracy, Olympic Games, scientific breakthroughs, and dramatic plays. Now, as part of the new bailout deal, Greece will have to sell off some of its ancient history to pay back the billions it has borrowed.


Featured image courtesy of Alexis Tsipras Facebook.