Wednesday, November 2, 2011
Adding to the Uncertainty
New York Times
November 1, 2011
For the already embarrassed Greeks, this is a new low. The prime minister's brinksmanship has pushed Greece over the edge.
What’s wrong with a referendum? After all, the Greek people would have the chance to vote on the euro rescue plan and determine the future of their country for the first time since the May 2010 bailout. Unfortunately there are many problems:
First, the referendum comes too late. Greeks should have had this chance 18 months ago. Then, there was a real choice: default, international isolation and brutal, abrupt spending cuts, or a bailout with austerity and a long recession.
Second, this proposal begins a ghastly game of chicken. Prime Minister George Papandreou was irresponsible to propose a referendum this week, but the reaction of the opposition was more irresponsible. Even members of its own party saw this as their last chance to ensure their survival in a post-Papandreou world. One wonders what he was thinking, playing a game like this in a political system in which opportunism is the norm and political leadership is as rare as clean streets in Athens.
And finally, even if Papandreou manages to survive and put together a referendum (highly unlikely), there is a great chance that the Greek people will vote against the European plan for a simple reason: Where everybody in Europe sees a 50 percent haircut, Greeks see more austerity.
Read the rest of the article here