News / Europe

Doubts Grow Over Austerity for Greece

Luxembourg's Prime Minister and Eurogroup chairman, Jean-Claude Juncker (L) talks with Greece's Finance Minister Evangelos Venizelos at the start of a Eurogroup meeting at the European Union council headquarters in Brussels, February 9, 2012.
Luxembourg's Prime Minister and Eurogroup chairman, Jean-Claude Juncker (L) talks with Greece's Finance Minister Evangelos Venizelos at the start of a Eurogroup meeting at the European Union council headquarters in Brussels, February 9, 2012.
Lisa Bryant

With the European Union demanding more spending cuts from Greece in return for billions of dollars in bailout funds, doubts are growing over whether more austerity is the right solution for Athens. Some analysts and politicians suggest that a once worst-case scenario, Greece leaving the eurozone, may not be so bad.

Even as he promised that Greece would meet European Union requirements for another installment of rescue funds, Greek Finance Minister Evangelos Venizelos said Wednesday that his country was on a "knife's edge." He said Some EU members want Greece to leave the eurozone, which he called  "playing with fire."

The EU has set tough conditions for Greece to get a $173 billion bailout. It needs the money by March 20, otherwise it risks defaulting on its massive debt. Despite angry public protests and riots last weekend, the Greek parliament voted in favor of more austerity measures. The move drew praise from EU officials like European Economic and Monetary Commissioner Olli Rehn.

"I'm confident that the other conditions, including for instance, the identification of the concrete measures over 325 million euros [more than $424 million in spending cuts] will be completed by the next meeting of the eurogroup," said Reihn.

But Greece did not meet the other conditions by Wednesday, when EU finance ministers were expected to decide on the bailout money. So instead, the meeting was downgraded to a conference call.

Philip Whyte, senior research fellow at the London-based Center for European Reform, describes the standoff between Greece and its creditors - which also includes the International Monetary Fund and the European Central Bank - as a bluffing game.

"The social strains in Greece are increasing by the day," he said. "At the same time, there's a complete loss of trust amongst the troika [EU, IMF and ECB] in Greece's willingness and ability to push through the sort of reforms that everyone expects the Greeks to push through."

Europe's two largest economies, France and Germany, have led the push for further Greek cuts. In a radio interview, French Foreign Minister Alain Juppe was optimistic that Athens would meet Europe's terms.

Juppe said a deal must reached. If Greece defaults on its debts and leaves the eurozone, the chaos would be even more terrible for the Greek population than it is today, and bad news for the eurozone.

Whyte also believes Greece will meet the conditions. But critics say that with the Greek economy shrinking, making it even tougher to repay its debts, further austerity measures aren't the answer.

"There is a growing view among certain countries in northern Europe that this game can't go on," said Whyte. "And that letting Greece go [i.e. leave the eurozone] may actually, in the end, be a better option."

This view - that both Greece and Europe would be better off if Athens left the eurozone - was echoed Wednesday by the European Parliament's conservative leader Martin Callahan. Callahan told fellow lawmakers that a so-called "orderly" Greek withdrawal from the monetary union, along with a devaluation of its currency, would save a generation of Greeks from a miserable economic inheritance.

You May Like

Captured IS Militants Explain Why They Fought

Fighters from Turkey, Syria tell VOA Kurdish Service what drew them to extremism, jihad More

Security Experts Split on Kenyan Barrier Wall

Experts divided on whether initiative aiming to keep out al-Shabab militants is long-awaited solution or misguided effort More

Video Philippines Wants Tourists Spending Money at New Casinos

Officials say they hope to turn Manila into the next Macau, which has long been Asia’s gambling hub More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Liberia's Almost Last Ebola Patient Grateful but Still Grievingi
X
Benno Muchler
March 26, 2015 3:41 PM
Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video US, South Korea Conduct Joint Military Exercises

The Eighth U.S. Army Division and the Eighth Republic of Korea Mechanized Infantry Division put on a well orchestrated show of force for the media this week during their joint military training exercises in South Korea. VOA’s Seoul correspondent Brian Padden was there and reports the soldiers were well disciplined both in conducting a complex live fire exercise and in staying on message with the press.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.
Video

Video Young Filmmakers Shine Spotlight on Giving Back

A group of student filmmakers from across the United States joined President Barack Obama at the White House this month for the second annual White House Student Film Festival. Fifteen short films were officially selected from more than 1,500 entries by students aged 6 through 18. The filmmakers and their families then joined the president and a group of celebrities for a screening of their films. VOA’s Julie Taboh reports.
Video

Video VOA Exclusive: Interview with Afghan President Ashraf Ghani

Afghan President Ashraf Ghani, during his first visit as president to Washington, gave a one-on-one interview with VOA Afghan Service reporter Said Suleiman Ashna, about his request for a change in U.S. troop levels, the threat from the Islamic State, and repairing relations with the United States and Pakistan. The interview was held at Blair House, late Sunday, in Pashto.
Video

Video California Science Center Tells Story of Dead Sea Scrolls

The ancient manuscripts were uncovered in the mid-20th century, and they are still yielding clues about life and religious beliefs in ancient Israel. As VOA's Mike O'Sullivan reports, an exhibit in Los Angeles shows how modern science is bringing the history of these ancient documents to life.
Video

Video Angelina Jolie Takes Another Bold Step

Hollywood actress and filmmaker Angelina Jolie has revealed she had her ovaries and fallopian tubes removed to lower her odds of getting cancer. Doctors say the huge publicity over her decision will help raise awareness about the importance of cancer screening. VOA’s George Putic has more

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More