Back at the crossroads
We have been hearing a lot of rumors in Greece and beyond about the possibility of a referendum being held this summer on whether the country should remain in the eurozone. Some believe that this is part of a great conspiracy to push Greece to the edge and trigger a plebiscite in an atmosphere of intense anti-European sentiment. We have seen no evidence to support this, however.
There are times when we feel such theories are the product of justified concerns – yet no too far from becoming psychoses – among those who see Greece drifting further away from Europe both institutionally and culturally. After all, it is almost impossible to imagine a political leader who would assume responsibility for a new Greek tragedy with incredible geopolitical consequences. The responsibility for preventing such a scenario is huge, because its effects would mark two or even three generations, as was the case with the 1893 bankruptcy.
The pro-drachma lobby has not lost momentum even after two defeats, one in the second elections of 2012 and the other at the 2015 referendum. Powerful businessmen who have a lot riding on a Greek fall keep oiling the machine and taking every opportunity to air their opinions. And, to be honest, there are politicians who are closer to Planet Drachma than they are to Planet Euro in every party. A large part of public opinion, meanwhile, is almost as angry today as it was in 2011-2012. The difference is that beyond people who are desperate and feel they have nothing to lose even if the country sinks into the abyss, we have a growing section of the middle class joining these ranks. Crazy taxes and social security contributions are driving a lot of people to despair.
The referendum and the drachma scenario lurk as risks in the form of an accident or sweet release. An accident may occur if bailout talks are not wrapped up by the summer, the economy sinks again, banks start to teeter and we go to the polls when the situation is unsalvageable. In this event, we run the risk of election reforms leading to an extensive period of instability during which the country’s debts will keep rising and the Europeans will run out of patience.
The other scenario is that we enter a phase of complete inertia and are faced with the question from Prime Minister Alexis Tsipras of whether we want to keep sailing the choppy seas in a leaky boat or prefer to try our luck in the water.
How the question will be phrased is something that the Grexit champions will be more than happy to help us with, fist and foremost among them German Chancellor Wolfgang Schaeuble.
I don’t believe that we will give him the satisfaction, but every month that passes without an agreement with creditors increases the risk of an accident – putting Greece right back at a critical crossroads.
