Some brief thoughts on Greece

July 6, 2015 § Leave a comment

The Troika are really playing with fire in Greece; today shows a country that is deeply worried and divided, even with the strong No majority that has emerged. If the sensible option – that is, cancellation of a large part of the unsustainable debt being financed on the back of Greek taxpayers – is not followed, the risk of social disaster and meltdown in Greece may become very real indeed.

The purpose of the EU, and indeed its single greatest achievement, has been in creating peace across Europe; it is that which should focus the minds of Greece’s creditors. Never mind that it was in part their fault that Greece had unsustainable credit access to start with, never mind that they have been as guilty as any of flouting the financial stringency rules the Euro was supposed to have – what people need to get into their heads, now, is that if Greece keeps down its current path it is being railroaded, angry and bitter, into a pariah situation. Geopolitically, nothing could be more dangerous – a poor, embittered country, its far right potentially insurgent on the back of the failure of its far left, with Russia and China circling its poverty like birds of prey. This is the situation that Germany and France are making a very real possibility; the short-term financial pain of debt cancellation would, for the wealthy members of the Eurozone, be well worth it to banish the greater threat of instability. As I began by saying – the Troika are playing with fire, and I do not want to speculate on who the flames might burn.

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