A resounding Greek ‘No’ vote in Sunday’s referendum on financial bailout sent global stock markets and oil in a tailspin and Europe into a deep crisis mode yesterday. Hours after the referendum, Greek finance minister Yanis Varoufakis resigned in a bid to remove a major obstacle to any last-minute deal to keep Athens in the Eurozone.
“Kicking the can down the road has been the cliche of choice over a slow euro crisis that has steadily strangled the life out of the Greek economy. But at some point Europe was bound to run out of road. That happened on Sunday night, when it emerged that the Greek people had said ‘no’ to continuing to engage with their creditors on the same suffocating terms,” said the Guardian in an editorial.
Analysing the crisis from the declaration of the referendum by Greek Prime Minister Alexis Tsipras, the newspaper noted that “mixing talk of ‘terror’ from their partners with haze about what would happen after a no, Tsipras and his finance minister aimed squarely for the heart rather than the head”.
Predicting on the road ahead following the vote, the paper said: “The messy fallout from the referendum will need to be much more adroitly managed than the campaign. Athens needs to cool the rhetoric, and negotiate with steely calm. It may be economically weak, but the logic of the negotiation could be on its side. If Greece is forced out of the euro, contracts will be disrupted and supplies may dry up for a while, but in principle a carefully managed devaluation could provide a path away from penury. For the broader Eurozone, by contrast, forcing Greece out will produce no upside. Instead of a negotiated debt settlement, official creditors could lose everything.”
On the lessons learnt for Europe and the global community from the Greek crisis, the paper observed: “European leaders who have been used to getting their way in the past cannot presume that they will do so in future. They must show some humility and listen to a Greek people who have been driven to this leap in the dark. They must come up with reforms to fix a rickety single currency from its foundations.”
The Daily Telegraph, by contrast, called for a new beginning in Greece and said that the Greek people have been misled. “They have been repeatedly deceived over many years. Their politicians told them that they could have it all: short hours, early retirement, a generous welfare state and taxation so lax that it bordered on optional. Later they were told, with the connivance of Brussels, that they could enjoy all the benefits of the EU and its single currency, but without submitting to the economic rigour that euro membership was supposed to require,” the paper said in an editorial.
“Most recently, they have been misled by the Syriza government, which attempted to blame others for its own failings and increasingly childish antics. While the conduct of Greece’s creditors has been far from spotless, it is Prime Minister Alexis Tsipras’s mishandling of his country’s fiscal crisis that has led Greeks to the brink,” it said, adding that Tsipras “was also irresponsible in telling voters that the risks of a ‘No’ vote leading to an exit from the Eurozone were negligible”.
This, the paper commented, was despite the Greek prime minister knowing “as well as anyone that German patience with Greece has worn perilously thin, and he should have been more candid with voters about the potential consequences of the referendum he called”.
However, the newspaper conceded that the bigger European picture “should be considered when reflecting on the number of Greeks who said ‘Oxi’, choosing to reject the European devil in favour of the deep blue sea, with all the turbulence and uncertainty that would entail. That choice may appear irrational, but it is also understandable... The ‘No’ vote leaves the European Central Bank with a dilemma: it must either inject huge sums into the Greek banking system, or see the economy collapse and Greece tumble out of the euro. To limit the turmoil in markets elsewhere, EU and ECB leaders must clarify their plans quickly.”
The German daily Der Spiegel, meanwhile, focused firmly on what it called was the failure of the European leadership in handling the crisis and questioned how “the rest of the Eurozone members, Germany above all, could have allowed a situation to develop in which the erratic leaders of an economically insignificant country with a population of just 11 million people could bring the currency union to the verge of collapse?”
In a strongly-worded editorial, the newspaper said: “For the past five years, politicians within the Eurozone, under German Chancellor Angela Merkel’s unofficial leadership, have shirked painful decisions that might have helped to solve the debt crisis in Greece. The consequence has been that the problems have been protracted rather than solved.”
According to the paper, the trend first started with the Greek bailout programme in 2010, where, in order to prevent a Greek default, the Eurozone states provided their first credit guarantees to Athens at the time. It also highlighted the refusal of European politicians “to even negotiate a debt hair cut that Athens had insisted upon,” because, it said, “The reason is clear: They are afraid of their own voters, to whom they would have to admit that the billions that have flowed into Greece have now vanished.”
Commenting on the impact of the vote on the US, the Boston Globe said: “Greece’s financial crisis, and its long-running disputes with the rest of Europe over how to solve it, were not America’s problem. [President Barack] Obama largely deferred to European leaders, even as the impasse deepened over the last six months... Over the past week, though, some of those European politicians turned the crisis into a more profound question about Greece’s future in Europe. It’s an unhelpful escalation in rhetoric, which the United States shouldn’t endorse.”
With the referendum verdict now out, the newspaper said in an editorial, Obama should make clear that the United States will respect the outcome and continue to support Greece. “The Eurozone is not the European Union, and the European Union is not Europe. Greece is still a democracy and a Nato ally, and the United States should publicly distance itself from the rhetoric that was aimed at scaring Greek voters. It would be better for the United States if Greece remained in the euro, but it’s not vital,” the paper said.
