Greek Voters - Choice between Scylla and Charybdis
Greece is in a mess. Who is blame? The Troika or Greece's politicians? I don't blame either. For me, the blame rests squarely on the shoulders of the political architects of the euro (monetary union) project. The European Union was established to promote peace and democracy in Europe and bind European states together. Mutual trading ties and the free movement of good and services helped to achieve this. However, the European political (and oftentimes unelected) elite wanted ever closer union between member states and thought that monetary union would be the way to achieve this. The problem with this idea is that it put the cart before the horse - political (and therefore fiscal and banking) union is a precondition for monetary union.
Any deal or extended bailout package agreed over the next few days simply postpones the inevitable (and creditor nations may want to do this to give their banks more time to repair their balance sheets). A YES vote in the referendum means more austerity and a stranglehold on economic growth for a couple of decades. A NO vote and Greek ejection from the euro will result in chaos, which may or may not be long lasting. Ultimately, the big danger now is that Greece joins Argentina in the middle-income club and that its young democracy begins to unravel. The resultant political and economic instability could be contagious and infect other vulnerable parts of the Eurozone. The euro project could therefore undermine the very reason the EU was established in the first place!
Any deal or extended bailout package agreed over the next few days simply postpones the inevitable (and creditor nations may want to do this to give their banks more time to repair their balance sheets). A YES vote in the referendum means more austerity and a stranglehold on economic growth for a couple of decades. A NO vote and Greek ejection from the euro will result in chaos, which may or may not be long lasting. Ultimately, the big danger now is that Greece joins Argentina in the middle-income club and that its young democracy begins to unravel. The resultant political and economic instability could be contagious and infect other vulnerable parts of the Eurozone. The euro project could therefore undermine the very reason the EU was established in the first place!
