Greek crisis is biggest test yet
Published 02/11/2011 | 05:00
For anyone wondering about the reasons behind Greek Prime Minister George Papandreou's shock decision to call a referendum on that country's most recent EU/IMF bailout, the sudden replacement of the entire armed forces high command, the chief of the defence staff as well as the commanders of the individual armed services, almost certainly provides the answer.
It has been blindingly obvious since at least the original May 2010 bailout that Greek public opinion is bitterly opposed to the austerity measures being dictated by the EU and the IMF. With the Greek economy continuing to shrink, the country's debts would still stand at 120pc of national output in 2020 even after the 50pc debt write-down agreed last week.
This means that even if they had dutifully swallowed the medicine being prescribed for them in Brussels and Frankfurt, the Greeks had nothing to look forward to only years, perhaps decades, of grinding depression. While they might have been prepared to endure a few years of austerity, expecting the Greek population to spend a decade or more mired in a deep depression with no hope of an upturn any time soon was never going to be a runner.