Saturday, June 16, 2012

Fears of Social and Political Unrest if Greece Leaves Euro

New York Times
June 15, 2012

With speculation swirling about a possible Greek exit from the euro — at a price tag estimated at more than $1 trillion — policy makers worry that letting go of Greece could risk something more precious yet: the social and political stability of Europe.

An uncontrolled default could unleash a host of frightening scenarios upon a country and a Balkan region on the edge of the European Union — including hyperinflation, political instability, disintegration of public services, increased migration across borders, social breakdown and even the collapse of law and order. Were nationalist politicians to fill the vacuum in Greece, that could escalate tensions with Turkey.

Even Britain, which is a long way from Greece, says it is drawing up contingency plans to restrict immigration in the event of a financial collapse.

This underlines a central dilemma: the departure from the euro zone of Greece, seen by many partners as highly unreliable, might make it easier for the rest to agree to the closer integration needed to save the euro.


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