Wednesday 22 February 2012

The latest Greek bail-out

It can't work and it won't work.  There's not much point in my telling you why not, other commentators have done an excellent job already.  This is not because the powers-that-be are acting particularly foolishly; it's because there are no good options available.  Daniel Davies has put together an ingenious game in which you can try in vain to come up with something that works: the current deal leads to paragraph 26.

Quite apart from the numbers not working, a general election in Greece has been promised for April.  Wolfgang Schäuble, the German Finance minister, wanted the elections postponed, because he quite reasonably had no confidence that an incoming government would abide by the terms of a bailout package, but a postponement seems not to be part of the deal.  I suppose there will be an attempt, probably not in public, to get anyone who's at all likely to be important in the next government to sign up to the deal before any money is handed over.  This could break down very quickly.


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