Europe playing Russian Roulette
The EU should have long ago isolated the fiscal crisis to Greece, Ireland and Portugal, says Colm McCarthy
Published 26/06/2011 | 05:00
A convenient narrative for European political leaders is that Greece has brought the current crisis on itself, through failing to deliver on the programme agreed with the troika in May 2010.
While there has certainly been foot-dragging in Greece over the last 12 months, the Greek government has made a reasonable effort, in dreadful circumstances, to stick to the programme. The budget deficit has been cut sharply and a further austerity package is likely to be accepted.
The true source of Greece's latest crisis cannot be acknowledged, namely the inadequacy of the May 2010 deal framed by the troika and accepted by a Greek government which had no alternative. The European political leadership decided, in May 2010, not to face the music and continues to deny the inevitability of a Greek sovereign default, which can be deferred, but not avoided, through the extension of additional funds.