The Return of the Euro-Crisis

A coalition of radical leftist parties seem poised to take power in Greece. Could the troubled country really leave the euro zone?

SYRIZA has promised to cancel the austerity measures Greece adopted as part of the bailout package and renegotiate its debt obligations. This could trigger a confrontation with Athens’ lenders in Europe and the IMF, potentially resulting in a Greek exit (or “Grexit”) from the eurozone. Prime Minister Samaras is playing up this risk. “We shed blood to take the word ‘Grexit’ away from the mouths of foreigners, and SYRIZA is bringing this word back to their mouths,” he said in a speech late last year.

It seems Samaras is getting help in this campaign from Berlin. By 2012, Merkel had decided Greece must be kept in the eurozone to mitigate the risk of a “contagion” effect that could hasten the departure of other members and threaten the common European currency. This position implied Greece had some leverage, because its exit would hurt Germany and other eurozone members, as well. Now, according to the German news magazine Der Spiegel, Merkel appears willing to accept a Greek exit, and her government is preparing for that possibility. Officially, of course, Berlin’s policy hasn’t changed: It wants to keep the eurozone intact. But it’s hard to read the unnamed “German officials” who spoke to Der Spiegel and not conclude that Germany wanted to send a message to SYRIZA that Berlin will call its bluff if Athens demands onerous concessions or scuttles austerity.

Tsipras publicly scoffs at the possibility that Greece will be forced to leave the eurozone. “We are through with the possibility of a Grexit, and there is only a Samaras-exit,” he has said—a nifty bit of sloganeering that has failed to soothe the nerves of Greeks who worry a SYRIZA victory will result in tumult between Greece and its creditors. Tsipras has tried to lessen those fears. The closer he gets to power, the softer his rhetoric has become. Only six months ago, says Economides, it looked like a SYRIZA victory would result in a Grexit. “Now they’ve talked their way out of that corner, and they’re leaving it open that they’ll do their utmost to stay in the eurozone,” he says.

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