Greece should remove its euro shackles

Greece should remove its euro shackles

Like the meanest of loan sharks, Brussels has been squeezing the life out of the Greek people for far too long. Whereas non-EU member Turkey is courted with billions of euros due to the usefulness of its airbase to NATO and its efforts to stem the flood of refugees heading to Europe, democracy’s birthplace is treated like an unwelcome poor relation advised to tighten its belt before receiving scraps off the family table.

The problem is that most Greeks have been forced to tighten theirs to the maximum over recent years. They have seen major cuts to their salaries, pensions and welfare payments. Taxes and unemployment have soared.

To add insult to injury, human rights groups blame the country for failing to care for refugees, stuck in Greece during an icy winter because neighboring countries have closed their gates, knowing full well that the government can barely look after its own.

This coming July signifies yet another watershed in Greece’s protracted debt saga. Athens must come up with €7.4 billion to pay its due tranche to the European Central Bank and other creditors, or be deemed in default, which would propel it to the edge of bankruptcy. It is uncomfortably sandwiched between two intransigent women, the International Monetary Fund’s Managing Director Christine Lagarde and German Chancellor Angela Merkel.

Lagarde views Greece’s burgeoning debt as unsustainable without further austerity cuts, and she wants European creditors to write off a substantial portion of monies owed. Merkel, citing her government’s duty to taxpayers, is not so disposed, and is unwilling to agree to the transfer of further funds to Greece under the current bailout agreement without IMF backing.

Moreover, the governing Syriza Party — which swept to power on the promise of ending austerity and boosting employment, only to renege on its pledges when faced with the decision to stay or go — cannot hammer a people who have been battered for seven years without triggering massive social unrest, and possibly its own demise.

While it is true that Greece’s economic health has rarely been in full bloom — largely because of corruption and tax avoidance on a grand scale — at least it was functioning before the country exchanged its drachmas for euros, and with that a slice of its own sovereignty.

The more Athens bends, the more it will be kicked around like a football between EU politicians, creditors and the IMF.

Linda S. Heard

I was living in Athens at the time of the changeover. Then, the city had an air of prosperity and was experiencing a property boom and an upsurge in tourism. Since the euro grew in strength, for Greece it has been downhill all the way. The government’s worries are understandable. No leadership appreciates being bound up by outside parties or being serially humiliated. But there are no perfect choices to make.

For Greece, remaining within the euro zone is akin to the steady drip of Chinese water torture. The repercussions of returning to the drachma will certainly result in a sharp shock followed by several very painful years. But at least there would be light on the horizon as a cheaper currency would oil Greece’s competitiveness in the fields of exports and tourism, and would attract investment. 

Europe would not have it easy either if Greece chose to walk, especially at this junction when the EU project is under the dark shadow of Brexit. Elections scheduled to take place in France and the Netherlands this year could bode well for anti-EU candidates who have vowed to hold British-style referendums.

The last thing the EU needs is to be left holding Greece’s multibillion-euro baby. And in the event that a return to the drachma was eventually judged to be a success, struggling EU member states such as Italy, Spain and Portugal might be tempted to take the same route.

Perhaps it is time for Greek Prime Minister Alexis Tsipras to show his mettle. Caving to the demands of Brussels is not working for his government or for the people it represents. The more Greece bends, the more it will be kicked around like a football between EU politicians, creditors and the IMF.

The Greeks had their referendum in July 2015. Some 62 percent voted no to the austere bailout conditions, but the people’s overwhelming decision went unheeded. Tsipras would have been wise to have listened. Provided he can muster enough courage, it is not too late.

• Linda S. Heard is an author and columnist specializing in Middle East affairs.

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point-of-view