Could Greece leave the EU without collapsing? Greece has one of the most radical of the still-existing Marxist movements (although I’ve never understood why) and I think the only thing holding the country in place is that it has to look “respectable” for the EU.
That said, even if the New Democracy party has won, I’m not sure that’s enough. They will have to form a coalition to govern. What I have read is that a lot of the young people who were the last-minute voters voted for New Dawn (think Ron Paul), which is wrongly considered neo-Nazi, but in any case wouldn’t be very cooperative with the more mainstream conservative party.
Another poster on another site said that the collapse is inevitable regardless of which party wins this election.
Greece will collapse.
Right now Greeks are taking all their money out of Greek banks. Because of the way the ECB functions all of these withdraws are AUTOMATICALLY replaced with ECB funds (same for all EU countries).
What’s going to happen very soon is that Either Greek government imposes capital controls (won’t happen) or the ECB stops replenishing the Greek banks. This will be the zero hour or tipping point of the crisis.
Greek citizens are trying to lock in the value of their Euros now before Greece exits the Euro and capital is immediately frozen and converted to Drachmas becoming substantially devalued in the process.
If it becomes clear that this is a wholesale bank run (it is by the way), and not just a momentary panic that will subside, someone has to act. Either the Greek government imposes capital controls and freezes the movement of depositors cash out of Greece so the banks can continue to pay their debts. Or the ECB stops the automatic replenishment of withdrawn Euros to Greek banks and thus ensures the Complete collapse of the country.
This is such a precarious unprecedented situation because by imposing these capital controls the Greek government would be accepting a loss of sovereignty on the scale of losing a war and if the ECB stops this replenishment they will be taking responsibility for potentially knocking over the first domino in a sequence that no one knows the extent of. The leaders of the ECB are of the opinion that they don’t have the political authority to make that kind of decision. I woud agree.
But in the meantime Europe continues to pay for the Greek collapse by essentially funding a bank run.
The whole story is that the ECB can afford to do this. But the same account patterns in Greece that began the current money migration out of the country’s banks can be seen in data from Spain and Italy. That, the ECB obviously cannot afford.
I read a few comments like those. Many in the Greece government have a great affinity towards Marxism. Coalitions will have to be formed -- and that is the problem.
True solutions cannot be realized with coalition building. The far-left party will likely come in 2nd or 3rd. They will not be willing to support reforms needed to get Greece back onto a strong economic footing. They are against strong cost-cutting measures.
With Greece, and likely Spain/Italy next, we are witnessing the last gasps of Socialism's death grip. True reform will not come from a governing coalition.
True reform will come when the inevitable collapse happens and sweeps aside the economic controls and policies that have made Greece a basket case.
A good sign that he collapse is sooner than later is the fact that bartering is sprouting up all over Greece. People are voting with their dollars and that is a good sign. This will bring needed benefits to the participants and put more pressure on the government.
This will help the Greeks get back to understanding the benefits of individual effort and the rewards that follow. That will help hopefully install some added distrust of government (which many already have)