Sunday, June 28, 2015

Greece and the Eurozone

My opinion of the Greek turmoil was sought, and, rashly, I gave it to The Washington Post.

Greek banks will not open tomorrow. France's exposure to Greek debt amounts to about 3% of French GDP. Greek default and eventual Eurozone exit would be more costly to France than granting additional writedowns of the Greek debt. A rational compromise should therefore be possible, but both sides are torn among contradictory forces and subject to ideological blind spots. There is plenty of blame to be shared among the parties. I do not choose sides, but my sympathies are with the unfortunate pensioners, hospital patients, and civil servants in Greece who will be--and have been--the first to pay the costs of this five-year crisis.