Greece’s secret weapon: Grexit would hurt Merkel most

As soon as the decision is made, the €55 billion bill comes due. That’s why it keeps not happening

27 June 2015

9:00 AM

27 June 2015

9:00 AM

German chancellor Angela Merkel may still be the most formidable politician in Europe, but this week she lost a bit of her reputation as the scourge of Mediterranean debtor nations. Greece’s firebrand leftist premier, Alexis Tsipras, actually gets on well with Merkel, however much his countrymen enjoy burning her in effigy and adorning her portraits with Hitler moustaches. In a recent profile of their relationship in Der Spiegel, Tsipras gushed, ‘She has this East German way of telling you honestly and straightforwardly what she thinks.’ His top adviser Nikos Pappas also admires Merkel, calling her one of the few leaders in the EU who would rather look at questions politically than economically. She grew up among communists, after all.

The past two weeks have seen the umpteenth exercise in European Union brinksmanship since Greece began having trouble paying its debts five years ago. Greece owes a €1.6 billion tranche to the International Monetary Fund by the end of June, and EU authorities have been unwilling to release the funds Greece planned to pay this with. By the time Tsipras submitted his 11-page sketch of budget-plugging VAT hikes at last weekend’s emergency summit in Brussels, EU finance ministers had begun briefing about ‘Plan B’, depositors were rushing to withdraw their money from Greek banks, and negotiators were considering capital controls and a ‘balance of payments’ programme that might put Britain and other non-euro-using countries on the hook. But then things wound up resolved in the usual way, with Greece headed for yet another ‘rescue’ that would damage its economy and leave it more indebted still.

These are dark days for EU idealists. On top of the seemingly endless Greek issue, and the debt and reform problems of Spain and Italy, the EU is facing threats on several other fronts, as James Forsyth details on page 16. A growing immigration emergency in the Mediterranean is threatening the principle of free movement within the eurozone. Anti-European sentiments have moved to the centre of British politics. Antagonism is growing between Putin’s Russia and the West, and Europe is paralysed in the face of Isis’s advance in Syria. The European project starts to look feckless.

Germany’s finance minister, Wolfgang Schäuble, a passionate believer in European union in his youth, has grown rigid and categorical as only a disillusioned romantic can. Merkel is as she was. Her problem is that the EU has always been better for German business than for German democracy. This contradiction worsened with the bailouts of May 2010. Till then, Greek debt had been heavily in the hands of French and German banks and other private funders. Europe’s summiteers — the European commission and central bank, along with the IMF — paid off the banks and shifted the risk to Europe’s taxpayers.

This is not a system that recommends itself to western ideas of democratic accountability as they existed a generation ago. Germans didn’t run up Greece’s debt, so they shouldn’t pay it — that would be taxation without representation. But the single currency follows a different logic. You cannot have currency union without a political union that makes transfer payments possible from surplus-running areas to deficit-running ones. Merkel has been a shrewd enough politician to understand the contradictions in her position. First, the EU has been a good deal for Germany. Second, Germans would never knowingly tolerate the system which makes that good deal possible. The Munich economist Hans-Werner Sinn has written brilliantly about how a liquidity mechanism called Target-2 creates eurozone transfers through credit. (The US housing bubble that culminated in the global financial crisis of 2008 was not altogether different. Rich Person A doesn’t just give money to Poor Person B. His money is used to guarantee a loan, on which A might earn interest. The failure of B to pay the loan back is covered by printing money, so society as a whole pays through devaluation.)

It was in Merkel’s interest to let Europe’s institutions provide breathing room for the Greek economy, while taking a draconian line rhetorically. If Tsipras’s Syriza party had not been elected last January, she could have carried on this balancing act for ever. When responsibility for Greece’s debt shifted from European banks to European taxpayers in 2010, the negotiating advantage shifted, too. Greece could have demanded debt forgiveness from Europe before 2010, and Europe would have had little choice but to pay the banks anyway — because policymakers feared a financial ‘contagion’ otherwise. But once the debts were out of the banking system, Greece’s politicians thought they had no cards in their hand.

They were wrong. Tsipras and Varoufakis showed that Greece was not as vulnerable as it looked. Greece still possessed leverage, albeit of a new kind: if it left the euro, an itemised bill would be presented to the German taxpayer, and whichever country precipitated the rupture would be blamed. This explains the bizarre tenor of the debt negotiations ever since. Germany and its EU allies — by withholding funds that Greece believed it had already been promised — act as if they are trying to provoke Greece into leaving the eurozone in a huff, so Greece can be cast as a deadbeat. Tsipras has avoided getting suckered into such a move. If Germany wants Greece out, it will have to say so. A Greek exit would not be the worst thing (economically) for Greece but would be a very bad thing (politically) for Merkel, because the moment Greece was expelled, Germans would be presented the above-mentioned bill for €55 billion in loan guarantees. Merkel would be vulnerable for the first time to broad discontent from German voters.

Virgil was not the first to remark that Greeks are really good at negotiating. Some of those present at last week’s sessions snickered at the news that the Greek delegation had sent the wrong version of its final fiscal proposal on Sunday night. It sounds like incompetence. It is more likely the sort of university trick shrewd students use to gain extra time. Tsipras and Varoufakis have come to realise they do have leverage over their negotiating partners. Tsipras’s early diplomatic visit to Moscow was enough to bring that home to Europe’s foreign ministers in a vivid way.

Negotiators have gushed over the Greek proposal. The European Council president Donald Tusk of Poland says it has brought a ‘new dynamism’. In fact it appears to be aimed less at Merkel and her colleagues than at their publics, in order to bamboozle them. It calls for improving Greece’s fiscal position by increasing taxes on pensions, increasing certain VAT taxes, removing exemptions on other ones, and putting an emergency 12 per cent levy on corporate profits over €500 million. There are two problems. The smaller problem is that the VAT hikes might be revoked and might be evaded. The larger problem is that they would fail even if enacted. We know this because the same type of budget measure has been tried on Greece half a dozen times now. Europe is assuming you can get a man to run faster if you make him carry more weight. You can’t. The slowing effects on the economy exceed the quickening effects on revenue collection. On the European side there may be a sense that it is important to humiliate Tsipras by making him to go back on his election promises — thereby setting an example for other potentially troublesome political parties in the eurozone. This is why modest reforms affecting pensions have assumed such an outsized symbolic importance in negotiations.

The whole thing rests on attitudes that have never been countenanced in modern western countries. These VAT adjustments are supposed to raise €1.36 billion in the 2016 fiscal year — just about exactly £1 billion. That means millions of Greeks are being driven to the wall over a sum that any one of several dozen people in Britain could cover by writing a check. One begins to see the source of Tsipras’s rabble-rousing appeal.

It was much remarked in all German press coverage last week that Merkel did not repeat the line she made famous earlier in the euro crisis: ‘If the euro fails, Europe fails.’ Perhaps the euro crisis is a problem of discipline in few deadbeat countries, as Merkel believed years ago. Perhaps it is a balance-of-payments crisis, as many economists believe now. At its core is the growing likelihood that Greece would be better off outside the euro, provided it could avoid a wrenching crisis in the first transitional days. It might even accede to international credit markets sooner if it acquired a currency with a real (rather than a make-believe) value, and thus could begin building a real (rather than a make-believe) economy. The problem between Tsipras’s Greeks and Merkel’s ‘Europeans’ (as Tsipras calls them, as if he and his people were not Europeans themselves) resembles divorce in generations past. Both parties might well be happy outside this joyless and humiliating relationship. But neither side seems able to live with the shame of being the one to walk away from it.


Got something to add? Join the discussion and comment below.

Christopher Caldwell is a senior editor at the Weekly Standard.

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Show comments
  • ThomasEPalmer

    ….All time hit the spectator Find Here

  • Man In Black

    any one of several dozen people in Britain could cover by writing a check

    cheque — chuck your spell-checker

    • black11hawk

      Christopher Caldwell is an American journalist and in American English ‘cheque’ is spelt ‘check’.

      • The Bogle

        And “sniggered” becomes “snickered”.

        • Abie Vee

          And pissed means something else.

          • benny black

            And rooting meanss something else…

  • Bonkim

    Little doubt the Greeks are good at negotiating. they are following the principles in the text-books.

  • MartinC

    To the €55bn in loan guarantees, you can add €79bn of ECB “Stability” loans to maintain liquidity of the Greek banking system (all this money that the Greeks are drawing out of their accounts has to come from somewhere you know).
    At the instant of Greek repudiation of its debts, all of those potential losses crystallize. At the moment all of those potential losses are not losses, because they are marked as “going to be repaid”.
    Yes. someone is going to have some very hard explaining to do to the German people, if that happens.

  • WarriorPrincess111111

    Alexis Tsipras is doing exactly what the majority of people would do in his position – playing the EU for all he can get! He has nothing to lose and everything to gain.

    • berosos_bubos

      So which of the ‘people’ have ever gained out of the EU ?

  • Alpha Farnell

    If you owe the bank £1m you’ve got a problem. If you owe it £300Bn…the bank got a problem.
    Greece not going anywhere out of the EU/Eurozone anytime ever.

    • Sue Smith

      If you owe the bank 1M you’ve got a problem. If you owe it 300M both the bank and YOU have got a problem. If you owe the bank 400+Trillion you don’t have a State anymore. Only a perpetual condition called “anxiety over misery multiplied to the power of 10”.

      (Dickens, “David Copperfield”)
      Micawber: Income 20 pounds, Expenditure 19 pounds; happiness.
      Income 20 pounds, Expenditure 21 pounds; misery.

      …and he wasn’t an Economist.

  • jim

    An exhausting mess. The more you look at it the worse it is.

    • World Citizen

      The spelling or the Euro?

      • benny black

        The weather…

  • John Carins

    “But neither side seems able to live with the shame of being the one to walk away from it”. Is this the same problem for the UK? Is their shame to be seen to be walking away in the case of Brexit? Absolutely not, Britain has done its bit by previously preventing the continentals from destroying themselves. It’s time to let the Germans have the complete burden of running their new empire and the problem of sorting out Greece. We should wish them good luck.

  • BoiledCabbage

    A Greek bank collapse would focus Syriza. They do not hold all the cards.

  • Patrick Roy

    Hitler’s daughter.

  • Hermine Funkington-Rumpelstilz

    Do you really believe Angelina Merkel has sleepless nights over Greece? I bet my left boob that that’s nonsense.

    • Hamburger

      Then you should look at her face in this mornings papers.

      • Hermine Funkington-Rumpelstilz

        Hallo Doppelwhopper. Guess what, I did just that – ‘Merkel steps back from negotiations’ is what the Spiegel reported only this morning. Now you will ask yourself, how did she know that before you did?

        • Hamburger

          That was yesterday’s news.

          • flipkipper

            This morning is yesterday’s news. Occasionally I cannot stop thinking you need to get a proper job.

        • JKP3000

          Spiegel gelesen, dabei gewesen!

    • Man on the Clapham Omnibus

      Then she ought to: if she/EU give in she is dead domestically; if they don’t there is a good chance Greece will default and Germany’s bill will be very large, much more than 55bn – that doesn’t include the ELA & Target-2 (which Caldwell doesn’t understand) – and again she will dead domestically. Her only chance is to continue playing Pretend-and-Extend and I am afraid lots of people seem to be bored with that game.

      • Purple Commoner

        Have you checked your credit card bill lately? As if you didn’t know how pretend and extend worked, pal.

    • robertsonjames

      Yes. She certainly does. And the bill Grexit would land on the doormat of each German voter, caused directly by Merkel having transferred the German banks’ exposure onto German taxpayers, is only the half of it. There is also Merkel’s profound obsession with pushing for, as she calls it, “more Europe”. To such people, desperate to make Germany the benign engine of European unification rather than the intransigent cause of European disintegration, Grexit is an utterly terrifying prospect: it would destroy the European Dream by showing that Europe actually has a reverse gear and that “ever closer union” is not a done deal.

      Unfortunately Tspiras knows all this and more and so is aware that for all the threats and denials Merkel and the German government will not countenance Grexit. That’s why he can play hardball with them and that’s why, rather than expulsion from the Euro, he’ll get the deal he wants in the final analysis.

  • Hamburger

    Thank you for your clear headed analysis.

  • TrulyDisqusted

    Greece owes hundreds of Billions of Euro’s.

    What happens on 19 September when they’ve spent the extra €7 Billion?

    The IMF debt is spread across most of the world. If the ECB use taxpayer’s cash to repay the IMF, then just as the EU have bought all the German and French banks PIIGS debt with a taxpayers guarantee, so the ECB are doing the same but with the IMF’s loans to Greece.

    Aren’t Europe’s taxpayers aware of this? Why do so few of them care and why are so few Brits concerned when although we aren’t in the Euro, we fund the ECB and the ESF and the EIP and Billions of pounds of British taxpayers cash is underwriting hundreds of billions of pounds of eurozone PIIGS loans?

    If this blows up, it isn’t just going to be Merkel in the firing line…. Cameron and Osborne must be up there too.

    *** reports are coming in that David Cameron has voluntarily agreed to give tens of thousands of those African and Arab economic migrants flooding into Europe “a new and better life in Britain…”

    On what friggin Mandate????

    • perdix

      Your “reports” are simply untrue. Don’t forget to take your tablets.

  • milford

    It’s lucid essays like this that keep me coming back to the Speccie. You just don’t get it anywhere else.

  • MrLouKnee

    so long as the EU collapses who cares

  • tomgreaves

    There is no possible resolution to this crisis. It’s lose lose lose everywhichway. When a stack of coins begins with the lowest ones askew, by the time you get a short way up the stack resembles a drunken sailor. It’s been said a squillion times before: the euro project was built upon sand, and its existential troubles will be endless. A balance of payments crisis has only one intelligent answer: devalue the currency. Any other solutions are pure opium dreams. But, the political idealists who deceived themselves into believing the euros was a runner, were high as kites and failed to face the reality of history: currency integrations don’t work! Coming back to earth will be a Humpty Dumpty moment and everyone, particularly those with huge egos and pensions to protect…such as Merkel, would rather destroy the world than face their humiliation. Chaos awaits us!

    • Lorenzo

      Well yes, the Greeks are so deep in the financial hole that they can never pay off what they owe. Lending them even more money that they can’t pay back only adds to the problem. Nobody wants to be the first to admit that billions of Euros won’t be coming back to the lenders, so there’s been five years of clapping for a financial Tinkerbell who won’t be flying around anymore.

      It was dumb enough to let them into the Euro in the first place, but catastrophically stupid to spend billions propping up the illusion that they could stay.

      • Sue Smith

        Hard to disagree with this line of reasoning.

  • Mc

    “She grew up among communists, after all.”

    That’s being overly kind to Merkel. She voluntarily joined Communist organizations and was appointed to their executive. In addition, her scientific career thrived in East Germany: an impossibility if the authorities even suspected there was a tiny hint that you weren’t an ardent supporter of the system.

  • How did a Stasi agent and an Agitation and Propaganda officer when a member of the East German ‘Free German Youth’…



    …become Chancellor of Germany? This is how…

    The following is a discovery I made only last month regarding the fake collapse of the USSR, and what that fraudulent collapse proves about the institutions of the West…

    When Soviet citizens were liberated from 74 years of Marxist horror on December 26, 1991 there were ZERO celebrations throughout the USSR, proving (1) the “collapse” of the USSR is a strategic ruse; and (2) the political parties of the West were already co-opted by Marxists,* otherwise the USSR (and East Bloc nations) couldn’t have gotten away with the ruse.

    ZERO celebrations, as the The Atlantic article inadvertently informs us…


    For more on this discovery see my blog…



    The West will form new political parties where candidates are vetted for Marxist ideology, the use of the polygraph to be an important tool for such vetting. Then the West can finally liberate the globe of vanguard Communism.

    Note: In March of 1990 when East Germany held its first “free” election since 1933…


    … there were over 338,000 Soviet soldiers still in East Germany…


    …proving that those “elections” were fake. October 3, 1990, witnessed German reunification. The West German side of Brandenburg Gate saw celebrations with fireworks. However, one won’t find pictures or film of even one celebration elsewhere throughout what was East Germany, because East Germany was occupied by the USSR, as was all of Germany now. For the next four years after the tearing down of the Berlin Wall, Soviet Armed Forces would remain in East Germany, ensuring that the new Communist regime was secure there before its total evacuation on August 31, 1994.


    * The failed socialist inspired and controlled pan-European revolutions that swept the continent in 1848(1) thought Marxists and socialists a powerful lesson, that lesson being they couldn’t win overtly,(2) so they adopted the tactic of infiltration of the West’s political parties/institutions. In the case of the United States…(continue reading at DNotice)…


    Now you know why not one political party in the West requested verification of the collapse of the USSR, and the media failed to alert your attention to this fact, including the “alternative” media. When determining whether the “former” USSR is complying with arms control treaties, what does the United States do to confirm compliance? Right, the United States sends into the “former” USSR investigative teams to VERIFY compliance, yet when it’s the fate of the West that’s at stake should the collapse of the USSR be a ruse, what does the United States do to confirm the collapse? Nothing!

    The fraudulent “collapse” of the USSR (and East Bloc) couldn’t have been pulled off until both political parties in the United States (and political parties elsewhere in the West) were co-opted by Marxists, which explains why verification of the “collapse” was never undertaken by the West, such verification being (1) a natural administrative procedure (since the USSR wasn’t occupied by Western military forces); and (2) necessary for the survival of the West. Recall President Reagan’s favorite phrase, “Trust, but verify”.

    It gets worse–the “freed” Soviets and West also never (1) de-Communized the Soviet Armed Forces of its Communist Party officer corps, which was 90% officered by Communist Party members; and (2) arrested/de-mobilized the 6-million vigilantes that assisted the Soviet Union’s Ministry of the Interior and police control the populations of the larger cities during the period of “Perestroika” (1986-1991)!

    There can be no collapse of the USSR (or East Bloc nations) without…

    Verification, De-Communization and De-mobilization.

    The West never verified the collapse of the USSR because no collapse occurred, since if a real collapse had occurred the West would have verified it, since the survival of the West depends on verification. Conversely, this proves that the political parties of the West were co-opted by Marxists long before the fraudulent collapse of the USSR, since the survival of the West depends on verification.

    The above means that the so-called “War on Terror” is an operation being carried out by the Marxist co-opted governments of the West in alliance with the USSR and other Communist nations, the purpose being to (1) destroy the prominence of the West in the eyes of the world, where the West is seen (i) invading nations without cause; (ii) causing chaos around the globe; and (iii) killing over one-million civilians and boasting of torture; (2) close off non-Russian supplies of oil for export, thereby increasing the price of oil, the higher price allowing oil exporting Russia to maintain economic stability while she modernizes and increases her military forces; (3) destroy the United States Armed Forces via the never-ending “War on Terror”; the ultimate purpose of the aforementioned to (4) bring about the demise of the United States in the world, opening up a political void to be filled by a new pan-national entity composed of Europe and Russia (replacing the European Union), a union “From the Atlantic to Vladivostok”; which will (5) see the end of NATO.

    Now you know how Bolshevik Russia survived in 1917; how the West “lost” China to the Communists in 1949; why the Eisenhower administration turned a deaf ear to the anti-Communist Hungarian uprising in 1956; why the Eisenhower administration in 1959 was indifferent to the Castro brothers’ Communist fidelity, actually used the CIA to overthrow the Batista government; why the Nixon administration abandoned Taiwan for Communist China, and signed treaties/provided economic aid to the USSR; why the Nixon administration refused to tell the American People that over 50% of North Vietnamese NVA regiments were actually Chinese People’s Liberation Army soldiers (attired in NVA uniforms, and proving that the Sino/Soviet Split was a ruse, as KGB defector Major Anatoliy Golitsyn told the West back in 1962), thereby (1) ensuring the Vietnam War would be lost; (2) destroying the prominence of the United States abroad and at home; (3) breeding distrust between the American people and their government; and (4) securing Communist victories in Southeast Asia. Working in the background within the political parties of the United States and Great Britain were Marxist agents doing their best to (1) ensure the survival of Communist nations when they popped up; and (2) sabotage any policies that would bring down a Communist nation. That’s why after the fake collapses of the East Bloc nations and USSR there was no mandatory Western verification process to ensure the Communists weren’t still in control.

    • Jams O’Donnell

      All that without mentioning the Illuminati even once! Or the Pope, for that matter.

      • “All that without mentioning the Illuminati even once!”

        The who? I’m familiar with the existence of Marxists, so why would you mention a Marxist created diversion?

        “Or the Pope, for that matter.”

        When did any religious denomination alert its flock that the collapse of the USSR is a strategic ruse?

        What precisely didn’t you comprehend concerning my initial comment? Are you insane or cognitively impaired that even the following succinct proof goes over your head…

        ‘The West never verified the collapse of the USSR because no collapse occurred, since if a real collapse had occurred the West would have verified it, since the survival of the West depends on verification. Conversely, this proves that the political parties of the West were co-opted by Marxists long before the fraudulent collapse of the USSR, since the survival of the West depends on verification.’

        Or are you a Marxist troll attempting the usual abysmal damage control?

        • Kaine

          Tell us the one about how JK Rowling didn’t write Harry Potter again.

          • “Tell us the one about how JK Rowling didn’t write Harry Potter again.”

            One fraud at a time, Comrade. In the case of the Marxist co-opted globe, however, we have the visual proof, as the succinct proofs in my initial comment provide.

          • Kaine

            By this logic the independence of the Irish Republic was a fraud because they kept the old post boxes.


          • “By this logic the independence of the Irish Republic was a fraud because they kept the old post boxes.”

            ‘Before Irish independence post boxes were red but one of the first acts of the new Irish Government was to order that green would be the new colour for Post Office letter boxes.’


            After independence was declared, all statues to English monarchs were taken down and all British emblems removed from government buildings. Not one statue to the reviled Lenin can be standing in Russia, yet none of the thousands of such statues were destroyed, and those few that were taken down (carefully) were hidden away in parks or museums, and the only reason those statues were re-located is because they were located in areas were tourists frequent the most.

            We then have the State Emblem of the Soviet Union illuminated at night high atop the Russian State Duma and Ministry of Foreign Affairs buildings! The hammer & sickle emblems high atop the Lubyanka are illuminated at night! The Russian Ministry of Defense’s official newspaper is still called Red Star(!) with the same four Soviet award emblems next to the masthead(!) with the image of the reviled Lenin contained in one of the emblems(!). How dense can you be!

            What is it that you don’t comprehend by the following succinct proof…

            ‘The West never verified the collapse of the USSR because no collapse occurred, since if a real collapse had occurred the West would have verified it, since the survival of the West depends on verification. Conversely, this proves that the political parties of the West were co-opted by Marxists long before the fraudulent collapse of the USSR, since the survival of the West depends on verification.’

          • “Tell us the one about how JK Rowling didn’t write Harry Potter again.”

            Okay, now I’m ready to take on this question of Rowling’s fraud, and thanks for the timely suggestion. See news filing for 7/2/15…


  • huw

    interesting piece, but the Gerry`s are on the hook for 75-80 billion euros not 55 🙂

  • greggf

    “Greece’s secret weapon:….”

    The effects of Grexit on the exchange rate of the €/USD et alia.
    It’s a known unknown…..

  • averagebritain

    Good article, which describes the ‘nub’ of the problem; the transfer of bank debt to the European taxpayer. The use of a Greek bailout – not for the benefit of Greece, but as the perfect money laundering vehicle, is becoming transparent. Gangsterdom is being unveiled, before our very eyes. Merkel and all the heads of state, including Cameron, are complicit in the crime and I think there’ll be an almighty social explosion, when the penny finally drops.

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  • benny black

    The greek people will decide their future not the german “Eu” president, greece is the home of democracy and should use this historical card to decide its future…

  • Not mentioned anywhere in this apparently scholarly analysis is the endemic corruption in Greece, the thousands of bureacrats who never appeared at work but drew a wage, the exceptionally low retirement age – and the adamant refusal of the present leadership to enact meaningful reform.

    The idea that Greece would be better off with the drachma – and at the same time, whilst not effecting far reaching reforms – is just plain wrong

  • Rhys Pilko

    Anyone else notice the similarities of the picture in the article ,and the cover of ayn rand’s atlas shrugged? And the fact merkel looks just like ayn rand did in her later years haha

  • global city

    Tsipras is trying to bump the whole EU into a socialist direction, ‘a new Europe’ as they say, in just the same way that Militant exploited Liverpool’s horrific problems in the 80s’ to try and foment a national coup!

  • global city

    All the same, I am still predicting a damp squib, should Greece default. No permanent damage, no global melt down, no depression in the rest of the EU….not even a rolling assault on the next weakest Euro members.

    All that will happen is that after some wobblies and short term losses on the markets things will return to normal and Greece will begin to prosper next year.

  • sidor

    The real question for Merkel’s survival is for how long the Germans are prepared to tolerate the economically disastrous construction of the Eurozone? This question is interesting in the historical context: no revolution has ever happened in Germany from below. But I doubt that we can see a new Bismarck any time soon.

  • WTF

    Glad to see that someone has finally stated the obvious truth that Greece is so far pushed against the wall it has little if anything to lose but Germany will reap the true cost of a Greek exit as they have to stabilize the Euro from further issues.

    When you’re that far in the hole of debt, there isn’t a lose-lose scenario as you cant fall any lower and the only way is up. What is it they say about drug addicts, many have to plumb the depths of drug laden despair before they can rehabilitate themselves. Perhaps this is the Greek moment for fiscal despair but whether true or not, its now the Germans debt and Merkels problem with her electorate.

  • Sue Smith

    Germany should walk backwards away from Greece. The sooner the better. In business there’s an old adage; ‘cut your losses and move on’.

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