An exasperated Tsipras calls for Syriza referendum on bailout cancellation!

ATHENS, Greece (PNN) - July 30, 2015 - Anyone who thought Greece’s third bailout program was a done deal or that, at the very least, the market would get a few months of respite before having to grapple with daily Grexit headlines again, got a rude awakening late last week when reports of a secret plot (hatched by ex-Energy Minister Panayiotis Lafazanis along with several Left Platform co-conspirators) to storm the Greek mint and seize the country’s currency reserves underscored the deep divisions within Syriza and betrayed the extent to which passing a third set of prior actions and sealing the deal on an ESM program would prove to be anything but simple.

Just days after Lafazanis’ plan leaked last week, Kathimerini claimed it had transcripts from a conference call between former Finance Minister Yanis Varoufakis and international hedge fund managers during which Varoufakis described yet another secret ploy to return the country to the drachma by way of establishing a parallel payments system set up using surreptitiously obtained tax filer ID numbers.

At that juncture, the opposition parties which helped Prime Minister Alexis Tsipras beat back a Syriza rebellion and pass the first two sets of bailout prior actions through parliament began to ask questions.

Essentially, opposition lawmakers wanted to know whether Tsipras was allowing his party to undermine progress on the bailout just as he was desperately courting MPs from across the aisle in order to win parliamentary approval for the deal’s conditions.

On Wednesday, Tsipras addressed friction within the party and suggested that if he lost his majority in parliament he would call for snap elections.

Today, some 200 Syriza members met at an Athens movie theater in an effort to figure out next steps for the divided party. Essentially, the Left Platform still wants to resist the third bailout while Tsipras simply wants to avoid party politics altogether until the new program is in place, at which point he’ll deal with Syriza’s far-left rabble-rousers.

Speaking to the central party committee on Wednesday, Tsipras essentially said that victory wasn’t an option in negotiations with creditors - it was either "compromise or default", he said. The PM also sounded the now familiar challenge to "anyone who thinks they can do better," daring any aspiring usurpers to "speak out", before insisting that the Greek people’s "no" referendum vote was not a "yes" vote to a new drachma.

Ultimately, Tsipras made it clear that the current situation - wherein he must depend on opposition lawmakers to pass legislation - simply isn’t tenable, which means that "opposing voices must stop."

Unfortunately, he continued, "there are no magic alternatives,” and the question now is whether Syriza can implement the deal.

Note that his is a question we’ve been asking for sometime. Just yesterday we reiterated this concern, arguing that "there’s something very odd about leaving the implementation of an unpopular bailout program to the political party from which the staunchest opposition emanates." To solve this problem, Tsipras has proposed an internal party ballot on Sunday if the opposition is serious in their contention that he should not have signed a deal in Brussels on July 12.

The significance of Tsipras' call for a party referendum shouldn't be overlooked.

In fact - and at the risk of overstating the case - were Syriza to vote on whether or not Greece should follow through on the agreement with creditors, the market could be in for an event that is far more dramatic and important than the original referendum.

While the question that would ultimately be posed to Syriza party members in any potential vote is "as yet undetermined," framing the referendum as a simple choice between canceling the agreement with creditors or proceeding with program implementation could set up a market moving event with the potential to send everyone - Greece, the IMF, the ECB, and the EU Commission - right back to the drawing board, and plunging the country into a fresh political, social, and economic crisis.