But there are many European officials and politicians who are opposed to anything and everything that might make the euro workable, who still believe that all would be well if everyone exhibited sufficient discipline. And that’s why there is even more at stake in Sunday’s Greek referendum than most observers realize.
One of the great risks if the Greek public votes yes — that is, votes to accept the demands of the creditors, and hence repudiates the Greek government’s position and probably brings the government down — is that it will empower and encourage the architects of European failure. The creditors will have demonstrated their strength, their ability to humiliate anyone who challenges demands for austerity without end. And they will continue to claim that imposing mass unemployment is the only responsible course of action.
Or to put it a bit differently, it’s reasonable to fear the consequences of a “no” vote, because nobody knows what would come next. But you should be even more afraid of the consequences of a “yes,” because in that case we do know what comes next — more austerity, more disasters and eventually a crisis much worse than anything we’ve seen so far.
What Would Thucydides Say About the Crisis in Greece?
The war between Athens and Sparta was already nearly two decades old, yet no end was in sight. With its citizens weary and restless, Athens adopted a brutal political calculus, declaring that those city-states not with them were, quite simply, against them. They threatened a neutral Melos with physical destruction if it refused to join the Delian League.
.. When Europe’s leaders insist that Greece belongs to the European “homeland” whether it likes it or not, ignore the growing social unrest and political paralysis in Greece, and refuse to reconsider the austerity package they previously negotiated with Athens’s former governing coalition, we are not that far from the Athenian claim at Melos that “the strong do what they have the power to do and the weak accept what they have to accept.”
Joseph E. Stiglitz : Europe’s Attack on Greek Democracy
Of course, the economics behind the program that the “troika” (the European Commission, the European Central Bank, and the International Monetary Fund) foisted on Greece five years ago has been abysmal, resulting in a 25% decline in the country’s GDP. I can think of no depression, ever, that has been so deliberate and had such catastrophic consequences: Greece’s rate of youth unemployment, for example, now exceeds 60%.
.. We should be clear: almost none of the huge amount of money loaned to Greece has actually gone there. It has gone to pay out private-sector creditors – including German and French banks. Greece has gotten but a pittance, but it has paid a high price to preserve these countries’ banking systems.
.. That concern for popular legitimacy is incompatible with the politics of the eurozone, which was never a very democratic project.
.. what we are seeing now, 16 years after the eurozone institutionalized those relationships, is the antithesis of democracy: Many European leaders want to see the end of Prime Minister Alexis Tsipras’s leftist government.
.. They seem to believe that they can eventually bring down the Greek government by bullying it into accepting an agreement that contravenes its mandate.
Can the United States Prevent a Grexit?
Over the weekend, I spoke to a couple of knowledgeable observers who both expressed the view that the European Union, and Germany in particular, had deliberately instigated a confrontation to bring about regime change in Athens.