14 may 2012, the unthinkable exit

That the crisis, greece's fault (28 april 2010), would lay that country low, was never in any doubt. The only question was the degree to which the euro would suffer collateral damage (23 july 2011). Two years ago, greece somehow leaving would have been absolutely catastrophic. Eighteen months later though, the dam was breached when the greek pm pulled his referendum rabbit out of a hat (5 november 2011) and merkel and co started talking openly about an exit. In doing so, they were clearly signalling their view that the threat level had been reduced from fatal. Today, floods, as even the no-break up high priests of the ecb's governing council let the greeks know that they simply can't have their cake (no austerity) and eat it (stay in the euro). Nor can they pretend they don't have a choice by not establishing a government like a naughty child hiding in the bedroom instead of facing the music. This high-stakes game of poker must have an end, and that greece will lose is inevitable. They really now must realise that they have to make a call: in or out. That is the abyss they must stare down in what is likely another election, though it may not wait for that. I must say I was very surprised to read the german line (of both merkel and schauble) that "greece would always be in the eu", as to my mind the best strategy to minimise the collateral damage includes showing clearly that the rules still operate, and in that respect things are pretty clear: the only option is for greece to leave the eu (16 january 2010). The germans though are nothing if not deliberate, and as politics is the art of the possible, this is another signal - that the plan is in place, and so just get on and push the button now if you're going to. It looks then like there's no more stake raising - it's for the greeks to see, or fold. And it's right that the people make the call, as they're the ones that will have to live with it. As for the rest, well the picture should be clear by the irish referendum of 31 may. Never a dull moment.