If Greece goes.
Can we be far behind?
Economist Roger Bootle writes:
…the real risk for the eurozone, though, is that Greek default and euro departure go relatively well, and after a year or so Greece is beginning a vigorous recovery on the back of a weak drachma. In that case, the people of Italy, Spain and Portugal would ask: “if Greece can do it that way then why can’t we?” And there wouldn’t be a good answer. The euro-zone would do the splits as soon as you could say Jean-Claude Juncker.
Of course, virtually no one in the Greek establishment wants Greece to leave the euro. Yet the country desperately needs decent economic growth. An end to austerity and a debt write-off would only do half the job. The other half is improved competitiveness. Achieving that through sustained deflation would be slow and painful, and would intensify the debt problem all over again.
It is not unusual for governments to cling on to what is the source and origin of a painful economic predicament. This is a version of what is known in the psychological world as Stockholm Syndrome, when prisoners become emotionally dependent upon their captors and do not want to escape.
Alternatively: No Exit For Greece (Josef Joffe, New York Times)
Pic: Business Insider