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Financial Times: A Grexit Is Starting to Look More Feasible for Athens

Author: Wolfgang Münchau
July 21, 2013

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"A country may decide to stay inside the eurozone for political or security reasons. But surely we are at a different stage of debate when an exit becomes economically viable."

I would like to ask all of you not to continue at this time this discussion on a new haircut ... It is not in your interest."

So said Wolfgang Schauble in Athens last week. I do not blame Germany's finance minister for refusing to discuss a Greek debt write-off at this time. His country's federal election is only two months away. Given Berlin's approach to crisis resolution, I struggle to think of a more certain way to lose the vote than to say: "All right, then, let's start to be realistic right now."

But Mr Schäuble went a step further in his remarks by raising the Greek national interest. It is, of course, for the Greeks themselves to define their own interest.

The most one could do as an outsider would be to try to speculate about a narrower version of this question: would it be economically rational for Athens to follow the path outlined by Mr Schäuble? Alternatively, should it get ready to leave the eurozone? Or try to default inside the eurozone?

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