We are invited to believe that the Greek election is between a couple of old parties, the political establishment, who “wisely” wish Greece to stay in the Euro, and some wild new parties who wish to be “irresponsible” and leave the currency.
The problem with this view is that all parties in Greece, and most Greek people, want to stay in the Euro. The argument is not, unfortunately, about an orderly withdrawal. The argument is over the terms of staying in.
The old parties have shifted their position. They moved from saying Greece has to stick to the deal, to saying they want to make some improvements for Greece. The EU spinners obligingly let it be know that these reliable parties would probably be offered a sweetener on victory. The new parties, full of anger and strong rhetoric, have also during the campaign moved their position. Syriza has toned it down a bit, and conceded that Greece does need some austerity, and needs to negotiate a new settlement.
The week-end press was briefed to warn of a firestorm if the challenger parties won. Mrs Merkel, meanwhile, has indicated there will be no renegotiation even for the “reliable” establishment, let alone for the tearaways.
The future of the Euro and the future of Greece in the Euro remains poised, as always. It all depends on the whether the Euro area digs in and allows no change to the deal or not. They are discussing when they bow to the inevitable, not how to keep Greece in as a happy and compliant member. That latter is not an option from any Greek government. Greece. after all, recently reneged on on a lot of her debt. That was under the old “reliable” parties who said they were delivering the loan agreement which was said to save Greece.
The inconclusive nature of the election result is not surprising. If the old parties do in the end have a majority, this will be spun as a victory for the Euro, but it solves none of the outstanding problems. It still leaves Greece struggling to hit any of the targets for the loans. The people cannot see a sensible choice to back with a firm mandate. The political parties all want to stay in the Euro, so that means they all end up offering a variant of the same policy! The Euro is destroying democracy, as some of us predicted. No serious party in Greece has told the electors the truth, that the Euro is not right for them. They are all trying to stay in a scheme which does not work. The only differences are the severity of the rhetoric about possible easing of the immediate pain of the loan terms that the Euro has forced upon them.