Saturday, January 24, 2015

Is Greece about to implode?

Is Greece about to implode with the expected election on Sunday of a far-left anti-austerity party that has nominally promised to cancel out the commitment to the EU deal to bail Greece out of its financial debt crisis?

In a word: No. As in yes, I am quite optimistic that Greece will not implode as a result of Sunday's election.

Mr. Tsipras and his Syriza party have indeed nominally made such as promise, but he has also made repeated public statements indicating that he has no intention of committing economic suicide.

My expectation is that he will indeed seek to renegotiate the EU debt bailout deal to make its terms at least somewhat less onerous, but I strongly suspect that the overall debt deal will remain largely intact even if the terms are indeed a bit less austere than the Germans would prefer.

I predict that Greece will remain in the EU and the euro.

I predict that Mr.  Syriza will be at least somewhat more generous with government services and aid for the unemployed, not so much as to make the EU bailout deal unworkable, but also not quite as much as the Greek citizenry might prefer. I think that will work out. I think most Greeks know that they need to suffer some amount of pain to get out of their predicament, so long as they can feel that the government is being more responsive to their needs than the demands of current corrupt officials.

As far as whether Syriza gets a sufficient majority or is able to form a successful coalition and what that coalition might be, all bets are off, but I think that will all work out as well.

Sure, there will be a lot of anxiety until this all plays out, but I predict that Mr. Tsipras and Syriza will be just the kind of breath of fresh air that Greeks - and Europeans in general - need to come together and start to really come to terms with cleaning up their own mess.

I am optimistic for Mr. Tsipras and Syriza and wish them well.

-- Jack Krupansky

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