The what-if scenario

If you read Alexis Tsipras’s statements carefully, what he is saying becomes quite clear. It is more or less obvious that the leader of the main opposition has no real road map with regard to how the country will exit the crisis. When the discussion turns to numbers and details, he generally resorts to the kind of creative obfuscation that is no different than that used by his predecessors. There is only one thing that Tsipras is clear about – a form of blackmail on Europe and the country’s lenders – and that is the threat that Greece will default on its sovereign debt and, in return, Europe will offer a generous write-off and possibly a major growth package.

To be honest, the hypothetical question of what would happen if played this particular kamikaze card has been on our minds ever since the crisis began. There are two schools of thought.

The first believes that back in 2009, former Prime Minister George Papandreou should have threatened Europe with a Greek default, as European banks and eurozone countries were not sufficiently shielded against a disastrous scenario of this kind.

What those who support this argument tend to forget, however, is that back then Greece had lost its credibility, no fiscal adjustment had taken place yet and, above all, Greece was in desperate need of cash in order to cover its huge deficits.

The second school of thought, which still persists, argues that the relationship between the country and its partners is a never-ending, painful give-and-take out of which Greece will get a considerable reduction of its debt and perhaps some money for growth. To achieve this you must earn credibility gradually instead of playing the bully. In the eventuality that your partners do not respond as planned, then you may become more aggressive, but only once you know that the country can survive without borrowing.

My impression is that we, as a country, are not the only ones who would like to find out where this kind of experiment could lead. Considering its contradictory positions and the general image of inconsistency that it puts across, the troika also appears to be in a rush to find out what would happen in such a case.

It has become clear by now that if certain bold decisions outside the box are not made by the country’s creditors fairly soon, both in terms of debt reduction and of growth, the time will come when a Greek politician will be obliged to try the rift method, whatever the consequences this kind of approach might have.

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