Skip to main content

Cookies and Privacy

We use cookies to improve your experience on our website. To find out more, read our updated Cookie policy, Privacy policy and Terms & Conditions

Athens Greece Wassilios Aswestopoulos/ZumaPress

A Way Out for Greece

Easing Greece’s debt burden while keeping it within the eurozone is the correct and achievable path out of the country’s crisis, and it can be achieved easily through a mutual accord between Germany and Greece. The result would be a win not only for the two countries – but also for the world economy.

QUITO – The Greek crisis is a tragedy for the country and a danger for the world economy. Germany is demanding that Greece continue to service its debts in full, even though Greece is clearly broke and the International Monetary Fund has noted the need for debt relief. The collision of reality (Greece’s insolvency) with politics (Germany’s demands) was bound to create a disaster. And, indeed, it has: the shocking collapse this week of the Greek banking system.

Yet there still is a way out of this mess. Greece’s debt should be cut sharply, and the country should remain within the eurozone.

In negotiations with its creditors this spring, Greece recognized this, insisting that its debt be reduced. Germany refused. Though the United States and the IMF privately sided with Greece, Germany prevailed, as creditors usually do.

We hope you're enjoying Project Syndicate.

To continue reading, subscribe now.

Subscribe

Get unlimited access to PS premium content, including in-depth commentaries, book reviews, exclusive interviews, On Point, the Big Picture, the PS Archive, and our annual year-ahead magazine.

https://prosyn.org/egVwbPC;
  1. bildt70_SAUL LOEBAFP via Getty Images_trumpukrainezelensky Saul Loeb/AFP via Getty Images

    Impeachment and the Wider World

    Carl Bildt

    As with the proceedings against former US Presidents Richard Nixon and Bill Clinton, the impeachment inquiry into Donald Trump is ultimately a domestic political issue that will be decided in the US Congress. But, unlike those earlier cases, the Ukraine scandal threatens to jam up the entire machinery of US foreign policy.

    0
  2. krueger21_trumpamericamediocre

    Making America Mediocre

    Anne O. Krueger

    America owes its economic strength to its private sector, which has long benefited from an absence of undue influence by politicians and the state. But under US President Donald Trump's administration, discretionary decisions by policymakers are increasingly giving some companies advantages over others.

    0