Wall Street Journal
February 19, 2015
The Greece crisis is reinforcing a cardinal rule of sovereign-debt crises: It isn’t whether a government can pay what it owes, it’s whether it wants to.
The new left-wing government in Greece is seeking to reduce debts it says it can’t pay; its finance minister, Yanis Varoufakis, has called his own country bankrupt and insolvent. It has initiated negotiations—which continue in Brussels on Friday—with other eurozone governments to reduce the burden its debt represents.
Tensions were high ahead of the Brussels meeting. German and Greek officials traded barbs throughout the day Thursday after Berlin flatly dismissed Athens’s request to extend its bailout program.
Both capitals appeared to be staking out their positions ahead of the talks, underscoring how ties between the two have frayed since Greece’s left-wing Syriza party, led by Prime Minister Alexis Tsipras, swept to power last month on its promise to scrap the unpopular bailout.