Athens Is In Flames

[JackSlack]

There is a variation of this -- Greece leaves the Euro through a messy process causing upheaval in the Eurozone... this cascades to other countries like Portugal, and the single currency falls apart, plunging most of Europe into lots of miserable pain.

Oh yeah. If Greece goes, Portugal will too for sure. They're at where Greece will be in a few years.

The austerity measures have to stop. It's just insane. I understand why they're politically advantageous (who wants to be seen shovelling money into a bottomless pit?) but they're killing any chance of Greece recovering.

[Epitome22]

Greece dug its own grave on this one, their own elected officials abused the hell out of the credit that was available to them during the "good" times, and suddenly everybody seems surprised when it has to be paid back. Also yes the conditions being attached to the second bailout are harsh, the permanent "advisers" looking over Greek finances are a particular insult. But Greece reneged on many of the promises made for the first bailout. You know the adage "fool me once..."

As for the "best" course of action, severing Greece isn't as impossible as it sounds. It's unpleasant for sure, but the Euro itself would survive a Greek exit. A weakened euro is still far more palatable than changing back to multiple independent currencies. Imagine the legal nightmare that would be for all the other countries.

I don't doubt the euro would substantially devalue, but not beyond the point where it would disintegrate. The EU's attitude seems to have changed to a full on hard line stance with Greece, they either play ball (austerity,tax reform etc) or they can go it alone.

[Ed.]

The main problem with the euro and why a Greek exit wont be allowed is that it was never an economic project its a political project to bring further European integration.

This is why they were allowed in despite not being remotely close to suitable because it served the European project but that appears to have backfired.