The election of Greece Prime Minister Alexis Tsipras last week, who came to power largely thanks to his anti-austerity campaign, couldn’t have come at a worse time for Europe.
But a Greek backlash against its creditors was inevitable, given the five years it has been forced to live in austere financial conditions since its bailout by the International Monetary Fund (IMF), the European Central Bank (ECB) and the European Union. That the bailout plan would unravel before it was completed was considered likely even at the time of its signing.
But Europe must realise that no country will happily accept living in a forced recession. As much as the Greece population must accept responsibility for the massive deficit spending that resulted from its democratically-elected government, Europe must accept the democratically-mandated demands for renegotiation that Tsipras has been given; if for no other reason than for the fact that the Eurozone was created so all member states would share the benefits and the inherent risks. That risk was to be shared has all but been abandoned by a my-country-first mentality.
Such a mentality will not help anyone, especially now. The Eurozone is striving desperately to bring itself out of a deflationary cycle, but according to figures released on Friday, the ECB’s stimulus packages were late in arriving. A conflagration of tensions between Greece and the Eurozone only threatens to further weaken the euro and throw fuel on a likely on-coming recession.
It’s time to end the Greek debt problem by implementing a reasonable repayment plan. Europe needs to not let its pride get in the way of an economic recovery.
